ITAKLinus
Posts: 630
Joined: 2/22/2018
From: Italy
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quote:
ORIGINAL: RFalvo69
quote:
ORIGINAL: Cap Mandrake
Are the banks running out of cash? Are they just protecting their employees? Are electronic banking systems failing? That doesn't sound good.
My understanding is: all of three. My daughter’s bank in Milan now requires an appointment for any kind of operation - including money withdrawing. I called on Thursday morning and I got my appointment for Monday at 12PM.
What I guess is happening is that money in the ATMs is running out, so you can't withdraw money with a credit or debit card - and there is a cap anyway (about 250 Euro, even if it depends from the bank and the kind of card you have). Since the bank is closed for the best part of the week, no one refills the ATM, and that's it.
Of course you can pay with your card, but some services (home delivery, for example) need cash. Portable devices are still not common enough in the South.
And then maybe you are going broke because your income is frozen (as I said, savings in the South are smaller) and need even a small loan (4-5000 Euro) giving as collateral the promise to repay once the economy is running again (or, more probably, your home - if you own it). If so, you meet two problems: first, the bank can just say "no"; second, the bank is closed anyway. As a result the liquidity available to you and your family is basically zero (this is what is happening to the people screaming at the bank in the video I posted). I shudder just thinking about it.
Then there is the ENORMOUS segment of the Italian population who works illegally - an endemic problem in Italy. These people are paid in cash, so they are not registered as workers and have no social security net. Once they finish the money they, almost literally, keep in their pockets, they are out of luck. They cannot even ask for loans, because, formally, they have no income. And there are A LOT of people in this situation, right now.
Here is where the criminality rides to the rescue. Going to an usurer is the classic way (I guess however that even he will ask for some collateral), but there is a simpler one: selling your gold. When the shockwave of the 2008 crack hit Italy, shops called "Compro Oro" ("We Buy Gold") appeared everywhere - and never really disappeared. Selling gold "the official way" in Italy is a long and tedious process. With the "Compro Oro" shops you bring to them maybe your wedding ring, or a small gold chain your parents gave you when you turned eighteen, or your grandma jewellery. The gold is valued, weighted and the shop pays you about half of its current value, in cash, at once, no question asked.
Most of these shops, of course, are run by some sort of criminal gang. However, what the "Compro Oro" shops do was never declared illegal (the only regulation is that cannot buy stolen gold - even unknowingly), and they are a source of cash in desperate times.
The examples I made are only a sample of the economic problems our South is facing right now - and why the government should act quickly: force the banks to stay open, allow low-interest loans and inject liquidity into the southern regions. While the rest of Italy could see these moves as "a privilege we didn't had", well, amen to that. The situation is already devolving. I wouldn't be surprised if guns come out during these assaults to the supermarkets (there are already rumbles that the trucks bringing groceries could be assaulted). The next move, if this happens, would be deploying the Army. And then?
Yes, I'm worried.
The problems seems to be that they're not refilling ATMs.
Also, that's the main element, Italy is one of the countries with the highes private wealth in the world. Therefore, it looks quite bizarre that people have no money and, in some cases, sharkloans are going to "offer their services" to them.
However, most of the wealth owned by italians is in assets, especially houses, which are by definition not liquid/cash. To this problem, we have to add few, relevant factors:
A) those who own houses are generally over-35 (if not 40) with stable jobs. It implies that they are part of the security net given by the State. They have basically to pay for the food and that's it.
B) those who don't own houses are younger, horribly under-paid people. They have basically no savings and they have to pay rents. Also, many of them are out of the safety net provided by the State because they have precarious jobs.
C) Southern-Italy is a whole different topic. Over there, the amount of people working illegaly is huge and Cov-19 emergency topped over a chronic economical fragility. Many survive through "small jobs" out of regular/stable contracts and they have little to none savings. Basically: if the cannot do some kind of little work and earn few hundred euro per-month, they have no way to survive. And the State cannot (doesn't want to...) help them.
I think the social stability of the country is in a very narrow road. Even in my relatively wealthy region, Tuscany, you can see that people are struggling. More importantly, the future is the big topic: I do believe that most of the people can make some efforts to go through this period, but, after that, we will be f@cked, economically speaking. And it doesn't help to keep the population calm. Everybody knows that now we are in the middle of the sanitary emergency but later we'll be in a huge economical tragedy.
Even if we imagine that we go back to normal at the end of April (and that's quite a wild assumption), there is still one month to that date. It's not gonna work. We cannot afford one more month, simply and plain as that.
_____________________________
Francesco
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