Government Letta to herald new era in politics Italy?

Letta is in for some hard work Italy formed a new government on April 27 after two months of political deadlock. Center-left leader Enrico Letta will be the new prime minister, presiding over a coalition cabinet of former Italian Prime Minister Silvio Berlusconi’s forces (People of Freedom party), center-left politicians and technocrats like formerly deputy governor of Italy’s central...

Will Hungary destroy the EU?

Orban defies courts Hungarian lawmakers on Monday overwhelmingly (265-11) approved a long amendment to the constitution which threatens democratic checks and balances. The biggest opposition party, the Socialists, boycotted the vote. The bill enshrines in the constitution policies that were previously struck down as unconstitutional by Hungary’s highest court. Among other things, it curtails...

Now what for deadlocked Italy and a vulnerable Eurozone?

A very unwelcome election outcome Last Friday we wrote in a preview on the Italian elections that the markets would welcome a “Prime Minister Bersani” with open arms. They would also be glad if the solid Mr. Monti would figure prominently in the post-electoral landscape. But we also warned about the byzantine electoral system fostering instability and insecurity. And that is precisely...

Europe demands attention from the markets again

Europe has caught the attention of the world again after a couple of months in which the continent didn’t spook the financial markets with ridiculous infighting, jaw dropping  scandals and financial sector mayhem. The markets have made excellent use of the period of respite: stock indices have reached multiyear highs and EUR/USD has climbed to 1.37. But last week political-economic...

Cameron’s EU speech: Brixit or Britin?

Big surprises? In a long-awaited speech, British Prime Minister David Cameron set out his vision on the EU and the relationship of Britain with the EU. He pledged to hold an in-or-out referendum during the early part of the next parliament – by the end of 2017 at the latest – if the Conservatives win the next general election. Cameron said he would campaign for the country to stay in...

$1000bn Coin needed to avoid next fiscal cliff?

The next fiscal crisis is set for February or March. Paul Krugman is pleading for minting a $1 trillion platinum coin to avert gloom and doom. Ideas like these help put a smile on your face in difficult times, but how will the fiscal saga really evolve? Will President Obama, House Speaker Boehner and Senate Majority Leader Harry Reid strike a deal on time? A 31 December deadline for the so-called...