Organized crime in Italy thrives because access to credit has become more difficult

[ASusilovic]

July 21 (Bloomberg) -- The mafia has cranked up money laundering activities in Italy after the credit crunch prompted banks to stop lending, leaving a funding gap that criminal capital has filled, according to the Bank of Italy.

“The crisis has given organized crime room to thrive because access to credit has become more difficult,” said Anna Maria Tarantola, the central bank’s deputy general director, in a July 12 interview in her Rome office. “Whoever holds large amounts of cash, like crime groups, can make investments that aren’t possible for others. They can now invest in fully legal businesses.”

The central bank’s financial intelligence unit tracked 15,000 suspicious transactions in the first half of 2010, up 52 percent from a year earlier, and exceeding the total for all of 2008, said Tarantola, who’s in charge of banking oversight.

http://noir.bloomberg.com/apps/news?pid=20601087&sid=a7mgNadT7PDU&pos=7

There is only one difference between banksters and criminals : net interest rates margins....

 

[orange_trad]

That's excellent news for Italians: the banks can't effectively gang up and 'teach them a lesson' by starving the economy of capital/credit if they don't approve of sg. (new legislation, bank-tax, etc.) And I'm only half kidding.

 

[zdreg]

Quote from ASusilovic:

July 21 (Bloomberg) -- The mafia has cranked up money laundering activities in Italy after the credit crunch prompted banks to stop lending, leaving a funding gap that criminal capital has filled, according to the Bank of Italy.

“The crisis has given organized crime room to thrive because access to credit has become more difficult,” said Anna Maria Tarantola, the central bank’s deputy general director, in a July 12 interview in her Rome office. “Whoever holds large amounts of cash, like crime groups, can make investments that aren’t possible for others. They can now invest in fully legal businesses.”

The central bank’s financial intelligence unit tracked 15,000 suspicious transactions in the first half of 2010, up 52 percent from a year earlier, and exceeding the total for all of 2008, said Tarantola, who’s in charge of banking oversight.

http://noir.bloomberg.com/apps/news?pid=20601087&sid=a7mgNadT7PDU&pos=7

There is only one difference between banksters and criminals : net interest rates margins....

where are the rate higher?
penalties on credit card accounts may give you a different answer than originally assumed.

the US is next with increased financial regulations and foolish economic policies.

 

[Petsamo]

Quote from ASusilovic:

There is only one difference between banksters and criminals : net interest rates margins ...

The Mafia cuts your nuts off if you default, the bankers don't.

 

[dandxg]

I don't buy it sorry. I was just talking about this very moment. I have many Europeans friends and family. In the Czech Republic anything over a 5 year mortgage is uncommon. The fact that they have Russian mafia has nothing to do with credit. On the other hand the US was built on credit and what did we get massive inflation which is still being worked off for some time to come. Until recently, credit was very easy yet we have always had many gangs and mafia so that logic doesn't hold up at all.

Do you really believe homes would still cost as much as they without 30 year mortgages?

 

[tiddlywinks]

Quote from dandxg:

I don't buy it sorry. I was just talking about this very moment. I have many Europeans friends and family. In the Czech Republic anything over a 5 year mortgage is uncommon. The fact that they have Russian mafia has nothing to do with credit. On the other hand the US was built on credit and what did we get massive inflation which is still being worked off for some time to come. Until recently, credit was very easy yet we have always had many gangs and mafia so that logic doesn't hold up at all.

Do you really believe homes would still cost as much as they without 30 year mortgages?

It is a tough 6-degrees to get the credit/mafia connection to ring true. But there is relationship with something called the black market. I'm not referring to Rolex and Hermes. I'm referring to currency exchange. Currency being, of course, determined by something with a perceived or an actual value. Here in the states there really is no black market, yet. Therein lies a nugget to take note of from the Italians.

 

[nutmeg]

Quote from dandxg:



Do you really believe homes would still cost as much as they without 30 year mortgages?

This is a very good point. I was reading an article about homebuilding and no matter what the innovations, a builder cannot reduce the price of a home to equal the savings of the price of an auto.

The point being is the credit needed to purchase a home pushes the buyer out of the market because of the car loan.

Which brings me back to your quote from a different perspective. I highly doubt a car would cost as much today if we couldn't get a 7 year loan.

I think we are seeing a pattern here to keep us broke.

This law/regulation will add this cost/?benefit and soon we are at an affordability issue, voila - more debt.