French election could spark ARMAGEDDON for EU’s bank if eurosceptics win, economist warns

Saturday, April 22, 2017
By Paul Martin

THE European Central Bank (ECB) will not be able to save the euro from a potential run on banks if eurosceptics turn out in force at the French elections, according to one of the world’s leading economists.

By SIOBHAN MCFADYEN
Express.co.uk
Sat, Apr 22, 2017

Joseph Stiglitz warned under-fire ECB chief Mario Draghi will not be able to do “whatever it takes” to correct the currency.

The French elections have raised the spectre of a potential Frexit thanks to the popularity of anti-EU campaigners Marine Le Pen and Jean Luc Melenchon.

Analysts say putting France’s euro membership to a popular vote is proving to be a main driver for voters but it is spooking markets.

Front National candidate Mrs Le Pen and left-wing Unsubmissive France candidate Jean Luc Melenchon are going head-to-head as the only two candidates to favour giving voters a say on the EU.

The country is currently on a knife edge as the electorate prepares to come out in force in tomorrow’s elections.

Now Mr Stiglitz says the outcome of the vote is likely to encourage Hedge Funds to dump the currency.

The Nobel Prize-winning economist said: “There is a lot of liquidity in the system and that makes it easier to launch a run on the banking system.

“The attack would be so relentless that even Mario Draghi’s commitment to do ‘everything it takes’ might not be enough.

“The country could wind up facing a situation of no choice and would have to impose capital controls.”

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