Investors Not Pleased With Italian Politicians
The extreme conflict between the establishment and the new natonal populist majority in Parliament has spooked investors. The difference between the Italian and German 10 year treasury rates just jumped up about 100 basis points.
This isn’t a crisis yet. I recall back when Italia caught a bit of Greek contagion (before ECB president Mario Draghi said “whatever it takes”) that the experts at the tesoro said they could handle interest rate spreads up to 7% (it got close back then)
The 9:41 comment was not by me. Someone is posing here.
BTW – the spread jumped from 2% to 3%. Not Greece yet.
Good–hopefully they lose every dime.
Too early to think this is significant. While a Euro bailout could cost $3T, nothing is going to happen until a hedge fund closes or some other failure to perform occurs, at which point the dominoes will start to fall, slowly at first, and then with greater force.
Perhaps China’s debt burdened HNA fund will be the first domino. It bears watching.