I think if there is a meltdown, particularly if it spreads to UniCredit, then other banks in Europe will also face problems. I think Deutsche Bank has potential to have problems. The nature of their business is such that the very low interest rates and the fact that there isn’t much difference between long-term rates and short-term rates is problematic for them because of their business model. So, there is likely to be some contagion. Once it starts, it’s very difficult to stop because I don’t think people understand what’s going on, and they are going to be quite surprised by these new bail-in rules. That in itself will cause significant problems both for small retail investors and, potentially, institutional investors.
Why Italy’s Banks Are a ‘Doom-Loop’ Risk that Could Bury the Eurozone - Knowledge@Wharton
The International Monetary Fund’s top staff misled their own board, made a series of calamitous misjudgments in Greece, became euphoric cheerleaders for the euro project, ignored warning signs of impending crisis, and collectively failed to grasp an elemental concept of currency theory.
IMF admits disastrous love affair with the euro and apologises for the immolation of Greece