Thread: Domino Number Three...

Wobble.....

Concerns grew on Monday that Italy could be the next victim of Europe’s financial infection, leading nervous investors to sell Italian stocks and bonds and damping euphoria over a weekend deal to bail out Spain’s banks.

Italian officials privately expressed concern that the 100 billion euros, or $125 billion, that Europe pledged to Spanish banks might not stop the troubles from spreading...

The main fear is that Italy cannot grow its way out of a recession fast enough to pay a mountainous national debt. Other concerns include the fact that Italy, with the third-largest euro zone economy after those of Germany and France, will have to shoulder a large portion of the bailout bill even as it grapples with its own sharp economic downturn.


Because Italy does not have enough economic growth to generate the money itself, the government will probably have to borrow it at high interest rates, adding to an already heavy debt load...


Italian 10-year government bonds dropped in value for a fourth consecutive trading session. The yield — a measure of the government’s borrowing costs and of investors’ perception of risk — climbed 0.26 of a percentage point Monday to just over 6 percent. That is the highest level since January and a level that Italy could not afford for long.

The Spanish government’s 10-year bond yield also rose, closing up 0.30 of a percentage point, to 6.466 percent. There’s no doubt contagion will come to Italy,” Daniele Sottile, a managing partner at the financial advisers Vitale & Associati in Milan, said at the same conference, which was convened by the Council for the United States and Italy on an island near Venice. “It’s proof that the European mechanisms designed to stop the crisis are not working.”

Sergio Marchionne, the chief executive of both Fiat and Chrysler, was more blunt at the conference. “Somebody better do something before we get to the point of no return,” he said...

Originally Posted by cpwill

Wobble.....

May well be beaten by Cyprus Cyprus next for bailout as eurozone crisis deepens | This is Money

Is Cyprus big enough to provide systemic loss that would drag down other Eurozone members?

Originally Posted by cpwill

Concerns grew on Monday that Italy could be the next victim of Europe’s financial infection, leading nervous investors to sell Italian stocks and bonds and damping euphoria over a weekend deal to bail out Spain’s banks.

**** the investors, let them bite the dust. Nobody made them buy bonds anyway.

Originally Posted by cpwill

Wobble.....

are you hoping for an economic collapse?

Originally Posted by randel

are you hoping for an economic collapse?

Hope doesn't change anything... either it's going to happen or not. Perhaps it NEEDS to happen in order to clean up the system.

Originally Posted by randel

are you hoping for an economic collapse?

Nope. I'd prefer to have a job and a well-paying one at that. But "Hope" is irrelevant (someone might have told the President it's also not a strategy). I think that the Eurozone is looking to lose several of it's members who will go through economic hard times, because the social-democracy big-welfare-state model that they have put into place is unsustainable.

I hope that we learn that lesson from their pain. I don't know if we will.





Anywho, I see Spain's 10 year borrowing cost has spiked up to 6.8% today.

Italy's one-year borrowing costs shot up from a month earlier at auction on Wednesday, marking a six-month high at 3.972 percent due to concerns about the country's ability to continue to sustain its debt mountain.

Parabolic....

Italy's borrowing costs will rise sharply at a bond auction on Thursday in a sign of mounting pressures on the euro zone's third-largest economy after a Spanish aid deal failed to convince investors the bloc's crisis can be contained...

The Treasury is expected to pay more than 5 percent to sell up to 3 billion euros of a three-year bond it last issued in May at an average 3.9 percent rate...

On Wednesday, Italy paid 3.97 percent on one-year paper, the highest yield in six months, as the worsening crisis fuels concerns about its 1.9 trillion euro debt pile, the world's fourth-largest.

Yields on the country's benchmark ten-year debt have risen as high as 6.3 percent in recent days, uncomfortably close to the 7 percent level that has triggered an upward spiral in other countries' borrowing costs...

think that the Eurozone is looking to lose several of it's members who will go through economic hard times, because the social-democracy big-welfare-state model that they have put into place is unsustainable.

Funny that the most social-democratic states are the ones that are doing the best.

Whats unsustainable is Capitalism in any form.

When the system collapses, the smaller economies, the weaker economies are the ones that take the hit, remember Capitalism is a global system.