ERM ^10

30.06.2016 • Gold and Natural Resources

From London Investment Alert (Great Britain)-

Brexit – what’s happening in its wake and what does it mean? One of the biggest changes has been a drop in the pound to new lows against the dollar. But maybe the pound should be dropping, regardless of Brexit. After the “ERM crisis” of 1992, when the Bank of England tried – and failed – to maintain a high value for the pound, the economy actually boomed.

A lot of market instability has been attributed to Brexit. But many of the trends were underway before the vote. For instance, European banks are suffering as investors question their solvency. Intelligence bulletins

Germany blocks Italy’s bailout plan

Italian banks are caught in a rough spot. European banking rules set by the EU require them to shore up their balance sheets, requiring them to raise capital. But they won’t be able to get new investors in the door without forcing losses on their existing shareholders. That’s why the Italian government wants to intervene, injecting around €40 billion into its banks, without causing any losses to shareholders. But that goes explicitly against EU rules. And Germany just restated that it wouldn’t waive them in order to help out Italy. More fuel for the eurosceptic “Five Star Movement” currently sweeping Italian elections…

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