Conflicts don’t cease in the European harem
In Forex, everything is like in life: they meet, get married, divorce...Only, they are not individuals, but whole nations. After all, it’s a bad luck to marry. You’ll run out of money. Those, who realized it, like the UK, for example, initiate a divorce. Finally, Brussels's marriages are starting to come apart the seams. So, is a harem really better than a single wife?
Proud women are those, who bargain a lot. Rome insists that it hasn’t got any alternative plan, but it is willing to explain Brussels the general truth. For example, it knows how to reduce its debt share of the GDP by means of driving up its economy growth. Pure arithmetic: if the denominator increases faster than the numerator, the quotient is decreasing. What’s the matter? You just need to speed the economy expansion up to 2% or more, so that the deficit of 2.4% will seem a trifle. And it doesn’t matter that the former government left the Italy’s GDP rate at 0.8%. Italians must give up living in a fairy tale. It is like when the father leaves you a cat.
Rome is likely to be inspired by Donald Trump, who has managed to drive the US economic expansion up to 4.2% in the second quarter, and to more than 3% in the third one, by means of the mass fiscal stimulus. Italy is also willing to offer a lot to its citizens. Including the tax reduction as well. Another matter is that the U.S. economy looked quite strong before the tax reform, and the U.S. creative president shows no sign of letting up, promising 10-percent tax cut for the middle class. He tossed a bone to the voters and instantly attacked the Fed. But, if the central bank stops hiking the interest rate, then the huge fiscal and monetary stimuli will result in the economy overheating, followed by recession. Everybody seems to understand it, but for ...the US president. There is only one question to ask the Americans:
- What political system do you have now?
- We don’t know; may be, it is clowncracy?
Unlike the USA, Italy has a supervisor. Eunuch. Or a few of them. The first one, the European Commission, rejected the draft budget, saying it brazenly broke EU rules on public spending. The second one, Mario Draghi, suggested Rome restrain its rhetoric. After all, Italy is better be more compliant. If it doesn’t want its banks to face real problems. The matter is that Italy is not like obedient, well-behaved Portugal, Ireland or Greece, following the Brussels’s orders. Its banking system has so many ties with the European banks that the dinner can start with candles and finish with a fire extinguisher. Anyway, the EC wouldn’t suggest a dialog if Italy weren’t important for the Old Europe. After all, will you bother about a person, whose blood can’t be used for your transfusion?
Italians can be only sympathized. The feeling that you are underpaid never fails. Even if Brussels has many times won in battles with the countries, disagreeing with its policy; Rome is a special case. At least, because of its size. It can well say to the EU, "don’t tell me how to swim and I won’t tell you how to dive".
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The content of this article reflects the author’s opinion and does not necessarily reflect the official position of LiteForex. The material published on this page is provided for informational purposes only and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC.