MILAN (Reuters Breakingviews) - Leonardo Del Vecchio’s late swoop on a key nexus of Italian finance is adding a thrilling chapter to his long career. After becoming the largest investor in Mediobanca last year, the restless 85-year-old Ray-Ban mogul now wants to double his 10% shareholding. That could unlock the door to controlling 22 billion euro insurer Assicurazioni Generali. Yet Del Vecchio’s goals remain a riddle.
MILAN (Reuters Breakingviews) - The coronavirus may have done what euro zone crisis could not: persuade the European Union to shrug off its bond taboo. European Commission President Ursula von der Leyen on Wednesday unveiled a plan to jointly borrow 750 billion euros to help EU states recover from Covid-19. There are obstacles. But the pandemic may help the 27-member union lose its aversion to joint borrowing.
MILAN (Reuters Breakingviews) - Cash was already unhygienic before Covid-19. Now in addition to being icky, it’s also irrelevant for many. Quarantined shoppers around the world have ditched grubby bills for more practical contactless purchases. Central banks won’t want to see traditional cash walk the plank altogether, but this may accelerate their consideration of a digital alternative.
MILAN (Reuters Breakingviews) - The race to save the summer holiday is on. Quarantines and travel curbs to contain the pandemic will constrain holidaymakers and hurt the $1.6 trillion tourism industry. With some creative thinking, however, the season could be partly saved.
MILAN (Reuters Breakingviews) - A mergers and acquisitions upset is deflating the Agnelli’s ambitions. With a planned $9 billion cash windfall from selling insurer PartnerRe and expected fat dividends from merging carmaker Fiat Chrysler Automobiles, with Peugeot, the Italian billionaire family was set just months ago for a global, diversification shopping spree. Their investment vehicle Exor has become a case study in how quickly the pandemic shifts fortunes.
MILAN (Reuters Breakingviews) - Wealth managers’ lending appetite should survive the pandemic. Collapsing markets triggered a raft of margin calls on loans to rich clients in the first quarter. Yet Credit Suisse’s relatively modest first-quarter bad debt provisions suggest the pain for big wealth managers will be manageable. And the promise of quick credit should ensure the wealthy keep borrowing.
LONDON/MILAN (Reuters Breakingviews) - The coronavirus pandemic may be the euro zone’s best opportunity to break its common debt taboo. The health emergency is stretching sovereign finances across the single currency area. That’s a problem for countries like Italy, which has the highest Covid-19 death toll and whose government debt is already at 135% of gross domestic product.
MILAN (Reuters Breakingviews) - Super Mario has a role to play in Italy’s healing process. As European Central Bank chief, Mario Draghi saved the euro in 2012 with monetary policy magic and prevented an Italian default. As the country risks crumbling under the costs of the spiralling coronavirus epidemic, Draghi’s name has emerged as either the next premier or president. He shouldn’t rush into the job just yet.
MILAN (Reuters Breakingviews) - The European Union is in danger of turning a health crisis into a prolonged economic disaster. EU leaders on Thursday failed to agree on a joint fiscal response to the Covid-19 pandemic ravaging the continent. Despite bolder European Central Bank support, inaction by European governments will make it harder for Italy and other indebted euro zone nations to ramp up spending to support their stricken economies.
MILAN (Reuters Breakingviews) - The European Union is poorly positioned to fight the economic shock caused by the coronavirus crisis. But it’s not powerless. Though the 27-nation bloc lacks central spending power to support Italy and other stricken member states, there are three things it can do quickly to help.