Josh Sigurdson talks with author and economic analyst John Sneisen about the crumbling state of the banking system in Italy, and with that, the rest of the world.
Monte Dei Paschi Di Siena, the oldest bank in the world was looking like it would be implementing a bail-in regime where the bank would cash out depositors’ accounts in order to pay off their abundant debt. Instead, it turned into a bail-out.
We update you on the story after originally reporting on it in 2016.
As the cited Zero Hedge article reports:
According to new research by Italian investment bank Mediobanca, 114 of the close to 500 banks in Italy have “Texas Ratios” of over 100%. The Texas Ratio, or TR, is calculated by dividing the total value of a bank’s non-performing loans by its tangible book value plus reserves — or as American money manager Steve Eisman put it, “all the bad stuff divided by the money you have to pay for all the bad stuff.”
At the top of the list is Monte dei Paschi di Siena, with €169 billion in assets and a TR of 269%.
Next up is Veneto Banca, with €33 billion in assets and a TR of 239%. This is the bank that, together with Banco Popolare di Vicenza (assets: €39 billion, TR: 210%), was supposed to have been saved last year by an intervention from government-sponsored, privately funded bank bailout fund Atlante, but which now urgently requires more public funds. Their combined assets place them seventh on the list of Italy’s largest banks.
This is happening as the global banking system is crumbling under its own weight as debt is accumulated in high quantities and manipulation is rampant. Bubbles are going to burst and when it comes down, it will come down with a force of epic proportions.
Despite this, people can save themselves, insure themselves and promote the prosperity of free markets and a free monetary system following the epic crash of a system as full of intentional flaws as that which we currently face.
We will continue to keep you up to date on this crucial issue!
Stay tuned for more from WAM!
Video edited by Josh Sigurdson
John Thore Stub Sneisen
Graphics by Bryan Foerster and Josh Sigurdson
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