Posted on 11/09/2011 4:16:54 PM PST by bruinbirdman
Italy on Wednesday became the first major economy to require an international bail-out as its debts hit “totally unsustainable levels”.
The country's escalating crisis prompted questions about whether European leaders had sufficient will or financial firepower to rescue it.
The interest rate at which the Italian government borrows on the international bond markets hit seven per cent – the point at which the smaller eurozone economies of Ireland, Portugal and Greece had to be rescued.
Italy, the world’s eighth largest economy, has more than £1.5 trillion worth of debt, which has prompted speculation from some world leaders that it is too big to rescue.
Silvio Berlusconi’s pledge to resign as prime minister failed to stem the financial turmoil, and mixed messages on how the eurozone would respond to the crisis added to uncertainty in the markets.
Angela Merkel, the German chancellor, called for deeper European integration and a new “breakthrough” treaty that would give the EU greater fiscal powers to stop member states from slipping into dangerous levels of debt.
However, there were also reports that German and French officials were privately looking at ways to make it possible for European nations to leave the eurozone, causing US shares to slump by three per cent last night.
The turmoil dramatically increased the risk of a “double dip” recession in Britain, with most economists predicting that the economy will grind to a halt before the end of the year.
Senior Government sources believed that a full-scale Italian financial collapse could knock “several percentage points” off the size of the British economy. British banks have more than £42 billion of outstanding loans to Italy, including almost £10 billion to the government.
David Cameron described the state of the Italian economy as “tragic” and urged European leaders to intervene quickly in the situation
(Excerpt) Read more at telegraph.co.uk ...
And so does America.
Only Germany could possibly bail out Italy.
However, that's the limit of their resources. Even that would cause political revolution in Germany and eventually cause a wholesale change of government.
France has their OWN debt problems emerging and can only save themselves, if that.
Seems we're still tracking toward deflation and widespread sovereign default eh?
The Fed will NOT buy Euro bonds on a widespread basis. It would be PERSONAL suicide for them...and every member of Congress that failed to vote for a dissolution of the Fed as a result.
This train is going to crash. Slow motion crash.
Man, betting on deflation was the best bet ever!
Glad I got out of debt!
Why can’t a government declare bankruptcy? I assume it’s because of the dominos that would start falling. But what happens when the money runs out, to all the people depending on government checks?
Yup. Slow motion. (No way back from here)
Gold, $1,200.00 by the end of the year, eh?
They come to live with you and the people who stole their money.
(Try to look like you don't have anything.)
Italy just looking for a “ Hair Cut:” like Greece. Want the people to forgive 50% of their debt.
That will be easy.
Part of the deal with Greece was that Italy won’t be bailed out with free money, not that it would be possible. Maybe northern Europeans should consider building some fences.
Aside from the distractions, our own US debt situation is probably terminal, too. There will be repudiations.
Nothing a decade of double digit inflation won't solve.
yitbos
Italy on Wednesday became the first major economy to require an international bail-out as its debts hit "totally unsustainable levels",
Yes, or repudiation and rebuilding.
Little off-topic but maybe of interest.
German Air Force In Training for Iran Strike
http://www.freerepublic.com/focus/news/2805083/posts
Not a chance. It would be nice, but there’s no way.
The next big thing for NATO will be in Syria — or will be calisthenics, or a big card game tourney in their barracks.
Thanks. Your guess may be better than mine. If that’s true, we’re footing nearly the whole bill. Hopefully, we’ll cut back on funds to Europe and other imbalances, if that’s the case.
Don’t expect logic and reason to rule the day.I think the plan is to burn out this country’s finances ASAP.All part of Obama and friends vision of a new world.
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