European think tank puts EU on a path to collapse much greater than the 2008 financial crisis
Despite the unprecedented amount of money spent by both sovereign governments and central banks to bailout financial institutions over the past eight years, a new report from a European think tank has determined that the state of Europe’s financial system right now is worse than in 2008, and on the path to a much greater collapse than what nearly occurred during the crisis of that year.
Measuring the years of 2008-2015, the Transnational Institute out of Belgium deduced that taxpayers forked out a whoppingÂ â‚¬747 billion ($792 billion) in bailing out EU financial institutions in that time period, and that these bailouts only delayed the inevitable crash that will occur sometime in the future.
In a recent report, experts of the Amsterdam-based Transnational Institute think-tank revealed that in 2008-2015, European Union member states spent â‚¬747 billion ($792 billion) on different bailout packages for banks.
Moreover, as for October 2016, some â‚¬213 billion ($226 billion) of taxpayersâ€™ money â€” “equivalent to the GDP of Finland and Luxembourg” â€” was lost as a result of such rescue packages.
The authors of the reports also pointed out that the Big Four audit companies (EY, Deloitte, KPMG and PWC) engaged in designing the most important bailout packages were responsible for losses.
Moreover, Transnational Institute experts that in addition â‚¬747 billion in bailouts, another â‚¬1.2 billion ($1.27 billion) has been allocated to the European banking sector in guarantees and liabilities. Despite the failures of this program, the EUâ€™s financial authorities believe that there is no alternative to such measures.
According to Friedrich, European political elites are driven by their own interests in the matter.
Friedrich also warned that the financial crisis is not over yet and all those bailout programs and packages only delay it.
“This ticking time bomb will explode. We can see that currently many Italian and Spanish banks are in a difficult situation. De facto they are bankrupt. Deutsche Bank also has problems. A new collapse is likely in the banking sector, and it will be worse than the 2008 financial crisis. If this happens the European Central Bank and European governments will not be able to handle it,” the expert concluded. – Sputnik News
For the second half of 2016 both Italian and German banks were continuously in crisis, with the situation in Italy leading to the resignation of Prime Minister Mateo Renzi. Â And now a bailout crisis in Greece has once again re-emerged, with the IMF and ECB so far without answers on how to deal with it.
More and more economists analyzing the state of the Euro and Eurozone place 2017 as a dire year for the solvency of their monetary and financial systems. Â And with interest rates already well into negative territory, and quantitative easing programs having reached the point of diminishing returns, any misstep in the banking system could lead to catastrophic results at a time when there is little money to come to their aid.
Kenneth Schortgen JrÂ isÂ a writer for The Daily Economist, Secretsofthefed.com,Â Roguemoney.net, and Viral Liberty, and hostsÂ the popular youtube podcast on Mondays, Wednesdays and Fridays.Â Ken can alsoÂ be heard Wednesday afternoons giving an weekly economic report on theÂ Angel Clark radio show.