Ex-ECB Banker Stokes Europe’s Banking Panic: “People Are Starting To Withdraw From The Market”
by Tyler Durden
ZeroHedge.com
Jul 6, 2016
The latest red flag about the solvency and viability of the European banking sector came this morning from none other than the chairman of Societe General and former ECB executive board member, Lorenzo Bini Smaghi who warned today that Italy’s banking crisis could spread to the rest of Europe.
“The whole banking market is under pressure,” the former European Central Bank executive board member said in an interview with Bloomberg Television on Wednesday. “We adopted rules on public money; these rules must be assessed in a market that has a potential crisis to decide whether some suspension needs to be applied.”
But what is most concerning is that one can make the argument that the former central banker was almost doing all he can to stoke panic: “There is no rationality in the market, it’s all very emotional. People are starting to withdraw from the market and to go to very liquid and safe assets.”
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