The week that begins today will certainly be remembered for a long time, because in a few days the near future of the financial markets but also of the euro and Europe will be played out. Three appointments could change the course of 2015: in finance but also in the economy and in European politics.
The first appointment, which is already for today, is represented by the counter-test of the Swiss tsunami on the markets. The surprise move by the Swiss National Bank to decouple the franc from the euro was disruptive, with the exploit of the Swiss currency appreciating by more than 20% in just a few hours, with the Zurich stock exchange losing 14%, with the contagion effect on the countries (Slovenia and Croatia) most exposed to mortgages in francs, with the crack of the first brokers and with the heavy losses on the franc of large international banks. But – here's the thing – after the initial effect, where will the exchange rate between the Swiss franc and the euro settle down? And will investors return to betting on Zurich's blue chips by buying shares at bargain prices or is the loss of competitiveness of the Swiss watch, pharmaceutical, mechanical and food multinationals destined to weigh on the stock market for a long time? These are questions that will take time to receive an exhaustive answer, but since last Thursday there has been more unknown on the markets. Which concerns us very closely and which for now is all to our advantage, of our cross-border commuters and of the Italian companies and traders in the border areas, whose future however remains shrouded in mists because no one really knows how long the current situation will last.
However, the most eagerly awaited appointment of the week is Thursday 22 January when the Governing Council of the ECB will meet in which President Mario Draghi will most likely launch European-style Quantitative Easing, i.e. a substantial program of purchases of State, including the Italian and Spanish ones, which will flood the financial system with new liquidity. Naturally it is not enough to say Qe and the eyes of the markets will be turned to the details: how much will the ECB invest, in what time horizon, who will take charge of the bonds, which securities will be purchased? It's the details that make the difference. But there is no doubt that QE marks a turning point with planetary effects that will certainly boost the financial markets, even if the move has already been partially taken for granted, and that its beneficial effects can also be felt on the economy. At least indirectly. Economists from all over the world have long studied the relationship between the Fed's Qe and the revival of American growth, but without arriving at unequivocal conclusions. It is said that the copious liquidity poured into the market by the Fed was one of the main causes of American growth. And this doubt is even more true for Europe, but one thing is certain: Draghi's Qe certainly generates confidence among investors and this precious asset, which in Italy as in Europe has so far been lacking, can somehow give a boost to investment and consumption. In any case, it's an asset.
Then arriving - and it is the third crucial appointment of the week - there are the Greek elections, scheduled for next Sunday. All the polls on the eve of the day agree in indicating the leader of the radical left, Tsipras, as the probable winner of Athens but also in highlighting that Syriza will not take the absolute majority and will therefore have to ally itself with other pro-European oriented political forces. What will be the position of the new Greek government with respect to the euro and with respect to the commitments undertaken with the Troika to support the public debt? It is probable that Athens will be able to extract some concessions on interest rates and on the extension of the repayment of its debts, but on condition that it does not completely cancel the policy of financial rigor previously agreed with Europe. In short, a nice rebus that can get out of hand for everyone and frighten the markets. The flight of capital, the rush of the Greeks to the bank branches to withdraw their deposits and the consequent liquidity crisis of two of the major Greek banks are not a good sign and dramatically photograph the uncertainty of the situation.
From the solution of the three cases of the week (Switzerland, the ECB and Greece) we will understand what the future awaits us. Without forgetting that from 29 January, i.e. next week, we will start voting for the election of our new President of the Republic, on whom the future of the legislature, the future of the Government and the future of the reforms will depend. There is enough to conclude that January 2015 will leave its mark and cannot be easily forgotten. Hot days await us.
