For the first time, the head of the European Central Bank, Mario Draghi, has conceded the possibility that the EU may fall apart. Draghi came out and said that any member leaving the Eurozone would need to settle its claims or debts with the bloc’s payments system before severing ties. This statement reveals the heated discussion at Davos and the rift that is beginning to spread. This statement, released on Friday, was made in a letter to two Italian lawmakers in the European Parliament.

Sentiment in Italy is turning very anti-euro and this view is beginning to emerge in other Eurozone states. While they are blaming Britain, the real issue is the insane management of austerity and negative interest rates. This has created a massive depression in Europe and the unending Quantitative Easing has destroyed the European bond market. Whenever the ECB has to give up, interest rates will soar, for private buyers will not be willing to risk it all when the EU is clearly doomed.

Based on data to end-November, Draghi is saying that Italy would have to pay €358.6 billion euro to leave — an exit tax. What Draghi fails to comprehend is that such demands will not keep the Eurozone together, and are more likely to cause it to disintegrate and just default on the ECB. Up until now, the very threat of defaults on cross-border debts has tended to keep the Eurozone together throughout the financial crisis. But pushing this too far will lead to default.

Southern Europe, which are the weaker economies including Italy, Spain, and Greece, have accumulated huge liabilities to keep the euro afloat while Germany stands out as the biggest creditor with net claims of €754.1 billion euros. This alone may set off the massive capital flight to the dollar. We are looking at the complete collapse of the Quantitative Easing carried out by the ECB since 2008 without any success. This will cause Trump problems with trade and currency, which he is not likely to understand.