Saturday, July 09, 2011

Watch Italy this Summer

For a solution read this, for the latest symptom of the terminal disease read the following:

Looking at the research from the site Zero Hedge there seems to be no surprise that Berlusconi has decide not to run for office in the next election.

 Much of the research apparently comes from Bloomberg and the Italian Treasury:

What the market is most confused by is that Spain, which everyone thought would be the next to fall after Portugal, yet which in the Cajas has the same GSE-type structure that provides a natural buffer to a housing system that is getting destroyed by its own Option ARM implosion (unlike the US' Liebor, Euribor is at 1.593% and making adjustable mortgages quite painful), the bond vigilantes decided to go straight to the gateway to Europe's core. Italy. So ignore whatever the PBoC is doing with the EURUSD, and Brian Sack is telegraphing with his ES ramp into the close: the truth is Italy is on the verge, and with all communicating vessels, the pain is only just beginning as Europe will find out very soon: as the chart below shows, there is a doozy of Treasury issuance about to be unleashed by the Italian Treasury.

Are we about to get to the heart of the PIIGS?

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