Markets reacted euphorically after the US job numbers and the installation of a new Italian government. We think they are misplaced on both counts, more especially on the Italian government. It’s really difficult to see anything positive coming from Italy embarking on reflating its way out of its debt trap. Source: A Misplaced Rally | […]
Entries Tagged as 'Italy'
June 16th, 2018 · Comments Off on A Misplaced Rally
May 30th, 2018 · Comments Off on Italy’s Coming Stealth Eviction From The Eurozone
The fiscal plans of the incoming Italian government will trigger a bond crash, capital flight, a bank run and a clash with the EU. They are simply not compatible with staying in the euro. Since an Italian debt crisis is already a matter of time anyway, minds have to concentrate on orderly ways out of […]
May 29th, 2018 · Comments Off on 3 Vicious Cycles Threatening To Blow Up Financial Markets
Despite economic tailwinds and a massive bond buying program by the ECB, Italy hasn’t been able to even dent its debt/GDP ratio. When the ECB ends its bond buying program and/or economic tailwinds turn and the new government embarks on fiscal largess, things will turn pretty rapidly. The eurozone framework makes the situation that much […]
March 30th, 2017 · Comments Off on The Coming Italian Bond Explosion
We think there are many reasons why Italian bond yields are likely to go higher, like eurozone tensions, a rising yield global environment, ECB tapering, political uncertainty, etc. Unfortunately, for US-based investors, the pickings are basically very slim. One has to have access to European markets, where there is only one ETF listed. There are […]
March 3rd, 2017 · Comments Off on Will Italy’s Lost Decades End With A Bang?
Italy’s economy isn’t expected to return to its 2007 output level until the mid 2020s. While Italy would benefit from an Italian Margaret Thatcher, there are few good options left to save its economy. Not even leaving the euro, now openly discussed, is without problems. Meanwhile, debt and banking problems persist and the risks abound. […]
December 15th, 2016 · Comments Off on All Quiet On The Southern Front?