Wednesday, 9 November 2011


Italy is a strange case. As the BBC reports it has low levels of national debt (though high government debt) and tends to balance its budget sheet before interest payments are taken into account.

These interest payments are the problem. As I have been writing this post the following has happened to yields on Italian 10 year bonds:

9th November 2011, 14:52:36 GMT

9th November 2011, 14:55:42 GMT
9th November 2011, 14:57:32 GMT
9th November 2011, 15:05:52 GMT

At least Berlusconi is going, The Economist said he should go as far back as 2001. To be frank his stranglehold over Italy's media and government strikes as rather dictatorial. Silver-linings eh?

ed. Added link to 7% video. 
ed. N.B. The small number below the % change is the important value, however if this keeps getting hiked at 8% day-on-day (or even the 10% it hit at one point) things will worsen very quickly. The value hit a high of 7.48 at around 7:00ET (12:00 GMT) giving an absolute change of 0.69 on the opening price, or ~10.2% increase.

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