Europe: Political anxiety has increased - BBH

European politic anxiety has increased, not lessened as expected, since the German election, according to analysts at BBH.  

Key Quotes

“Spain's largest constitutional crisis in a generation is winding down.  Puigdemont's secessionist play failed.  There was no international support.  The elite (political, economic, and royal) showed a common front.  Nor was Puigdemont successful in helping topple Rajoy's minority government.”  

“Instead, Puigdemont danced around:  declaring and suspending independence.  Madrid is not the only one calling for a clear, unambiguous statement.  The far-left party in his regional government alliance has threatened to withdraw support from Puigdemont, which would likely trigger a new regional election unless he declares independence.”  

“Italy approved a new electoral reform bill, which appears to have few bells and whistles and does not include a bonus number of seats for a party with the most votes.  It rewards pre-election coalitions.  This is to the detriment of the populist-nationalist Five-Star Movement, which rules out such coalitions.  It seems to be a small step toward addressing the fragmentation of Italy's politics.  It may still be short of creating majority parties, but the coalitions may consist of large blocs.”  

“Ideas of an election this year, or even in Q1 next year, may be exaggerated.  The electoral law needs to be debated and approved by the Senate.  More pressing is the 2018 budget.  That will take the next several weeks.  Then there is Berlusconi, who has challenged being barred from running for office.  It is not immediately clear if Berlusconi indeed wants to run for office again.  Still, it would make sense that Berlusconi and his allies seek to delay an election until the European judicial decision is handed down, and that may not be until next year.”