It has been several weeks since the name Monte Paschi, likely the most bailed out Italian bank in history, not to mention the oldest bank in the world, graced these pages: with the Italian elections now over and BMPS' political utility as leverage against Italy's Democratic Party finished, we expected that the next time we would read, and write, about it would be the next time it would need a bailout (its fourth in the past four years) sometime in the next 3 to 6 months. Sadly, Monte Paschi is squarely back on the front page following news moments ago that David Rossi, the head of communications at the bank, committed suicide by jumping off the building.
David Rossi, head of communication of Banca Monte dei Paschi di Siena, was killed this evening by jumping from one office to the headquarters of the institute in Rocca Salimbeni. Rossi, 51, was the longtime collaborator of the former Number 1 at Monte Paschi, Giuseppe Mussari.Rossi had been raided ten days ago in the investigation on Monte but was not investigated. On the spot, in addition to the police, it's 118, but the relief effort was useless.
Rossi was for many years a man of representation of MPS and its former president. Among his other responsibilities were marketing and communications.
While we have no knowledge of what personal, or professional, matters may have plagued the young man shown in the picture, if this terminal act of desperation is in fact related to the ongoing inquiry against the bank, then it is very likely that things in Italy are about to get very ugly very fast once more.
Some more from the Italian press:
The association with Mussari was started since 2001, when the former president of MPS and Abi was head of the Foundation, the reference shareholder with 34.9% stake in the bank, and Rossi was responsible for the communication of the institution. No left to imagine the dramatic climax, colleagues who had also contacted in recent days for the latest news on the institution of credit had responded with the same friendliness and professionalism of all time.
Rossi, married, had two children and was well known in the city.
Its commitment to the bank manager, joined also the vice president of the International Center of Art and Culture of Palazzo Te and a member of the board of directors of paint for cultural projects.
In a basket in his office investigators have found a crumpled piece of paper. Above, according to reports, it was written: 'I made ??a bullshit'.
A bullshit big enough to take one's life over, and to deprive two children of their father?
The Spanish Prisoner: why the adjustment in Spain looks like it will eventually fail
The people of Spain are prisoners of an economic adjustment that looks like something dreamed up by Torquemada. Let me explain. I was discussing Spain with a colleague, and I mentioned the ongoing collapse in Spanish labor compensation.
He cheerfully connected the compensation decline with an improvement in Spain’s competitiveness, and offered the improvement in Spain’s trade balance as proof. A lot of the recent compensation decline had to do with public sector workers (who export nothing) and not private sector ones, but let’s assume he’s right that private sector wages are impacted as well. Is this a sustainable way to regain competitiveness? Historically, balance of payments crises brought on by competitiveness gaps were almost always addressed in part through currency devaluation, as shown in the table. Let’s go to the archives.
The 2008-2012 recovery in Spain’s trade balance didn’t happen as quickly as the other episodes, but at least the gap closed, right? Not so fast. Spain’s exports have been growing, but its recovery is the worst of the bunch, indicating that trade improvement relies heavily on an import collapse and 25%+ unemployment. The last chart is the smoking gun: the growth dynamics of the current Spanish adjustment are nothing short of terrible in an historical context.
One could also look the collapse in capital spending in Spain, down at a 28% annual rate in Q4 2012 even when excluding construction. Did inflation spike in prior episodes after devaluation? Yes, but real GDP measures improvement after taking inflation into account, which is why the last chart tells you most of what you need to know. Torquemada the Inquisitor would be impressed with the pain that Spain is inflicting on itself. The bad news for Spanish labor markets isn’t over: most measures of Spanish competitiveness show that only half the gap has been closed vs Germany. I don’t see how this can be sustained indefinitely, even with the rally in Spanish sovereign and bank spreads, and with looser fiscal policy sanctioned by the EU. Without a true fiscal transfer union in Europe, caveat emptor in its Periphery, unless prices for stocks, bank loans and real estate are sufficiently cheap.
Troika in successive talks in view of March bailout tranche release
Representatives of the troika – as officials from the European Commission, the European Central Bank and the International Monetary Fund are collectively known – were scheduled on Wednesday to participate in successive meetings held at the Finance, Development and Labor ministries in Athens.
The country's international creditors were expected to discuss pressing issues such as their demands for layoffs in the public sector with Finance Minister Yiannis Stournaras, as well as the opening of so-called closed professions, market deregulation and privatizations with Development Minister Costis Hatzidakis.
The coalition government is currently in the process of identifying civil servants who have violated the code of conduct or used false documents to obtain their position, for instance. According to Kathimerini, the Ministries of Finance and Administrative Reform expect that this monitoring will enable the selection of about 7,000 to 8,000 employees who will leave the public sector by 2014.
The measures being discussed are required for the disbursement of the March tranche of the bailout package, worth 2.8 billion euros.
Eurogroup expresses 'satisfaction' with Greece over February targets
Euro area finance ministers meeting in Brussels expressed their "satisfaction" with Greece for meeting the targets for February set out in its second bailout agreement with international creditors, but said that the disbursement of the next tranche of funding, worth 2.8 billion euros, will depend on whether Athens achieves targets set for March.
"The Eurogroup notes with satisfaction that the MoU milestone for February, agreed between Greece and the troika, has been achieved," a statement issued following Monday's meeting said. "In particular, the medium-term fiscal strategy has been updated, introducing three-year expenditure ceilings for line-ministries and the health sector.
"Moreover, the Eurogroup welcomes that, going beyond the requirements of the milestone, Greece also prepared monthly targets for the largest state-owned enterprises (SOEs) with a view to later extending them to all SOEs. This step further safeguards the delivery of fiscal commitments and represents a sign of strong program ownership."
The statement goes on to call "on the Greek authorities to keep the reform momentum and, in particular, to fully implement the agreed milestones for March, as a precondition for the disbursement of a further sub-tranche of 2.8 billion euros under the second installment" of bailout funding.
Democratic Party leaders are now discussing Bersani's plan.
Bersani ended his speech by calling on the Five Star Movement (M5S) to engage with the democratic process:
Beppe Grillo has previously said that M5S could support specific measures that fit with its own priorities.
Bersani's eight-point plan for a government of change
Important developments at the Democratic Party meeting. Pier Luigi Bersani has unveiled the eight-point plan which he hopes to base a government around.
Bersani also ruled out a grand coalition with Silvio Berlusconi's centre-right alliance.
Instead, he pledged to propose a 'government for change' based around an "essential programme".
The first challenge is to break out of the 'cage of austerity' created by Europe's policy of fiscal consolidation. The first priority must be to help the real economy - only then should Italy turn to deficit and debt reduction, he says.
The remaining points are:
2) Measures to tackle the social emergency in Italy
3) Reform of its political system;
4) New measures on equity & justice
5) New rules on conflict of interests;
6) Green economy & sustainable development
7) Working on legislation on citizenship rights for migrants & civil partnerships;
8) Improve education, and research & development
Bersani also argues that Italy could play a key role in changing Europe's economic policies.
Monti, though, wasn't the only leader who fell short in the Italian election. Bersani concedes that the result was a disappointment, and effectively a defeat
(hard to argue, given the Democratic Party entered the contest with a strong lead)
Back to Pier Luigi Bersani. He has pointed out that Mario Monti, the technocratic PM, failed to win enough support to play a significant role in the next administration.
Submitted by Tyler Durden on 03/06/2013 16:23 -0500
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