Spanish politicians trying to cushion the blows of austerity plan to seize foreclosed homes to house the needy, discouraging foreign investment and threatening to violate terms of the European bailout of the country’s banks.
On the same day Cyprus’s parliament rejected a European Union bailout involving a tax on deposits, political leaders in the region reached a deal bringing the euro zone one step closer to a banking union.
The Fondazione Monte dei Paschi di Siena has its headquarters in the baroque Palazzo Sansedoni overlooking the Italian city’s main square. It was there, one day in November, that Chairman Gabriello Mancini delivered the bad news: The foundation, which for 15 years had supported the districts that compete in the renowned Palio horse races, could no longer pay for the spectacle’s colorful medieval costumes.
An accelerating flight of deposits from banks in four European countries is jeopardizing the renewal of economic growth and undermining a main tenet of the common currency: an integrated financial system.
Italy’s inconclusive election triggered renewed market convulsions over Europe’s debt crisis as recession-scarred voters repudiated budget rigor and established former comedian Beppe Grillo as a political force.