Invisible Eurozone liabilities require action by global financial regulators

TARGET2: scale of invisible Eurozone liabilities demands action by global financial regulators

We recently had a blog published by Politeia about the lack of transparency in the accounting for the debts of EU/Eurozone member states. The member states’ contingent liability to backstop the debts of the EU is an example. Member states also have a contingent […]

Rising Debt, Greater Risk – The EU’s invisible accounting system

The Eurosystem’s balance sheet now shows that its assets of €12 trillion exceed the Eurozone’s 2020 GDP of €11.4 trillion. This is attributable to the emergency response to Covid by the European Central Bank (ECB), who both created the Pandemic Emergency Purchase Programme (the PEPP), extended the programme of unsecured loans to banks called Targeted […]

Technical blog on the Eurozone’s Hidden Debt: A Dangerous legacy of EU governance – Politeia

You can DOWNLOAD HERE the technical blog that accompanies the Politeia article on extrapolating lessons for the Eurozone, UK and global banking systems from the proposed merger of UniCredit and Monta dei Paschi di Siena.

The case raises difficult questions about whether any meaningful re-capitalization of banking systems has occurred since the Global Financial Crisis or […]

The Eurozone’s Hidden Debt: A Dangerous legacy of EU governance – Politeia

As Italy’s oldest bank is poised to merge with its second largest, Bob Lyddon considers the failure of Eurozone governance and its potential consequences –   from which the UK is not immune

The UK-EU Withdrawal Agreement (2019) with its Northern Ireland Protocol remains one problematic matter of unfinished Brexit business.  Less widely known is the matter […]

Unicredit capital position before merger with Monte dei Paschi di Siena

It looks likely that Unicredit will be entering into a shotgun wedding with Mone dei Paschi di Siena (MPS). Unicredit will be compelled by the Italian political and monetary authorities to act as a White Knight.

MPS just failed its European Banking Authority Stress Tests but then it has been flat broke for years.

For a putative […]

No-one can know the size of the Brexit divorce bill, and it won’t be finalised until 2028, or for decades after that

Two of the key patagraphs in the Withdrawal Treaty itself

What are HM Treasury and the EU playing at? Their dispute rumbles on over whether the Brexit divorce bill is the EU’s estimate of £41bn or HM Treasury’s (or rather the Office for Budget Responsibility’s) of £35-39bn.

The discussion feels phoney. The quoted amounts cannot include all […]

How worried should we still be about the Brexit divorce bill?

This is the actual agreement…

Below is the text of an article we had published on CapX last week about the bunfight between HM Treasury and Brussels on the supposed size of the Brexit divorce bill: in short, neither of them can know for sure what it is because of the loopholes in the agreement on […]

The ECB and the PEPP: why are the credit ratings of EU/Eurozone public sector issuers inflated by as many as four notches?

The discussions and calls following the launch of my Bruges Group paper “The ECB’s Pandemic Emergency Purchase Programme” surfaced two areas for further examination.

One was the “pot calling the kettle black” issue: why is the UK structurally and materially in a superior position (even if we have the wrong direction-of-travel and share some of the […]

ECB and its PEPP programme: why are we doing a better job in the UK?

I have been in a lot of calls since the launch of my Bruges Group paper “The ECB’s Pandemic Emergency Purchase Programme”.

Two issues keep coming up and so I have decided to write two notes on them.

This first one comes down to the pot not calling the kettle black. Or, put more elegantly, […]

Video – ECB Pandemic Emergency Purchase Programme

Walk-through of newly-issued Bruges Group paper on the ECB PEPP programme – the epitome of the failure of the euro.

PLEASE CLICK THIS LINK TO PLAY…