Posted on 11/27/2011 2:56:37 PM PST by blam
Italy Is Closer To Collapse Than Anyone Realized, And So Is The World
Bruce Krasting, My Take On Financial Events
Nov. 27, 2011, 1:29 PM
Some stories in European press (La Stampa - Zero Hedge link) suggest that Italy is working on a very big loan package from the IMF. I have no doubt that there are ongoing discussions. There has to be. Either someone puts a finger in the dike or Italy goes tapioca.
That thought is difficult for me to fathom. How could we be so close to the brink? At this point there is zero possibility that Italy can refinance any portion of its $300b of 2012 maturing debt. If there is anyone at the table who still still thinks that Italy can pull off a miracle, they are wrong. I’m certain that the finance guys at the ECB and Italian CB understand this. I repeat, there is a zero chance for a market solution for Italy. Either the ECB (aka Germany) steps in and underwrites the debt with some form of Euro bonds or the IMF (aka the USA) steps in with some very serious money.
I have acknowledged in recent articles that I misread the Italian story. I didn't see this coming at the pace that it has. Italian bond yields more than doubled in a month. I was not alone in this very big misread. I believe it has caught everyone flatfooted. Central bankers and finance officials all over the globe are crapping in their pants.
I think the Italian story is make or break. Either this gets fixed or Italy defaults in less than six months. The default option is not really an option that policy makers would consider. If Italy can’t make it...
(snip)
(Excerpt) Read more at businessinsider.com ...
The free market system is just as it always was. Go barter something.
Have Italians been messing with the FR site?
The US steps in with some serious money?
The only money we have is fiat and we’re printing it as fast as we can in a keyesnian nightmare....
My gut is telling me this won’t stall off until after Christmas....
Swell. Where exactly is that money coming from?
I read that Black Friday sales were up 7%
Surely Happy Days are here again? /s
Barney Frank and Chris Dodd destroyed the global economy. One flipping regulation is all it took.
The IMF... I mean the USA... is also broke. I guess that doesn’t matter any more?
They want to keep propping up failed socialist countries until we all fall down together??
I'm not sure that 7% even keeps up with the real rate of inflation.
>>Swell. Where exactly is that money coming from?
The same place as all of our money: from the imagination of the Federal Reserve System. They’ll conjure it up out of thin air, and then loan it to the US government at a “fair” interest rate so the government can give it away.
See my tag line.
And the housing bubble began, then went POP.
Grabbing the popcorn, while the house looses value,
unthought of.
Socialism r US!
All the dominos are in a circle.
And yet Obama continues to drag us in that direction.
Italians off!
Up next, student loans.
Would pay real money to see the student was loaned pop my popcorn. Dang student sleeps all day. Them student loans are worthless. May have to hire a grandchild. Cannot afford a maid.
How will this affect the unions at Chrysler? Will we have another round with the auto industry?
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