Notizie

Financial Times - Investor confidence in Italy collapses . Bond yields soar to euro-era highs amid political uncertainty .--------- Bloomberg - Schaeuble said that he is not worried by Italy’s bond spreads right now because they are similar to spreads in the days before the introduction of the euro, the people said on condition of anonymity because the committee meeting was held in private. The bond spreads will narrow once political uncertainty over the leadership question in Italy is resolved, Schaeuble said, according to the two people.--------- Reuters - Italy's debt crisis reaches a breaking point .------- Reuters - Berlusconi resignation vow fails to calm markets: The 75-year-old media magnate's insistence that the only way out was elections early next year, and deep political disagreement about the next move only worsened the uncertainty. An election would put Italy in limbo for several months and there was no sign of agreement on the urgent formation of a transitional government that would likely calm markets. ---------- MarketWatch - However, in general, Italy is better off. And in a note Wednesday, he (Marc Chandler, global head of currency strategy at Brown Brothers Harriman) laid out five reasons why: 1. Italy’s average debt maturity is much longer, meaning any rise in yields is not an immediate problem and “will take some time to filter through into Italy’s debt burden.” 2. Italy collects many more taxes than its debt service costs, even if it hypothetically had to pay 7% on all its debt. 3. Its overall debt burden – combining private and public debt – is relatively low compared to developed countries. 4. More than half of Italy’s debt is held domestically, which gives the government a little more say. For example, “bond swaps can be foisted on domestic institutions. Domestic institutions can be required to hold more government bonds in, say, pension portfolios.” 5. Finally, Italy “has other sources of wealth.” The country has a whole lot of gold – the fourth highest reserve in the world. ---------