So.  Spain got a bailout (and continues to negotiating their banking bailout).

And, Greece got repeated bailouts. (I still consider Greece’s non-timely payments of less than the amount owed to be a default — and I expect them, to leave the euro zone before 2013 is over).

Who is next in the banking handout parade?

Why its Italy!

Italy’s banks don’t have as much debt relative to some other nations (Spain) but their government does relative to GDP. Bravissimo!

Ciao, Italia!


click for larger graphic
Will Italy be the next in line for a bailout?



As world economic growth ebbs, talk of new stimulus surges
Howard Schneider
Washington Post, June 12, 2012

Category: Bailouts, Digital Media

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

8 Responses to “Up Next in the Bailout Line: Italy?”

  1. amboycharlie says:

    I am wondering to what extent interest rate swaps and other derivatives have undermined the European banks and government institutions. I also wonder to what extent the U.S. treasury has been involved in undermining the Euro in order to preserve the dollar as the reserve currency as long as possible. The Euro, had it been more viable, would seem to have offered the only alternative for those who did want to trade in dollars. And some even claim the war in Iraq was done to prevent Saddam from selling his oil in Euros. Paul Craig Roberts has a great article on his blog about how the United States is a bit like Wily E. Coyote, spinning its wheels to preserve the dollar when its already off the cliff.

  2. 5imon says:

    Hmm..this is a pretty flimsy opinion piece.

    So the measurement you’re using to judge who will be next to ask for IMF/ECB/EFSF/ESM assistance is debt/gdp ratio, correct? Willfully disregarding that Italy is neither insolvent (like Greece) nor has a banking capitalisation problem (like Spain)? With a budget surplus a country can run up debt. Look at the US.

    Granted Italy’s debt needs political will to resolve, but are we really saying that the bond markets will doubt Italy’s ability to pay back debt? With a technocratic government, no less?

    Flimsy. Very flimsy.


    BR: Read the WaPo article

  3. super_trooper says:

    Would Italy be the last one standing?
    Are both Portugal and Ireland safe for now?

  4. b_thunder says:

    “…and I expect them [Greece], to leave the euro zone before 2013 is over”

    Before the end of2013? BR, always an optimist

  5. tagyoureit says:

    The breadline for the 21st century.

  6. louiswi says:

    Gee, I wonder why Spain didn’t just go to the Vatican and say “remember all those trillions we stole for you from the South American natives back in the day? We could use a hand now”. That seems like a logical solution, doesn’t it?

  7. WFTA says:

    He keeps talking about “massive fiscal stimulus.” Well, tax cuts are fiscal, but stimulating? What we’ve spent trillions on is keeping insolvent, mismanaged, too-big-to-fail financial institutions afloat. Business as usual.

  8. Marc P says:

    I read these articles about Italy and wondered whether this is the high-water mark for Italy’s debt load. I did a little checking. In the early 1990s Italy’s debt load was higher than it is now relative to GDP. This was largely because they were paying 12% interest on government bonds. Before you think of that as proof of a wasteful and irresponsible government, remember that the U.S. was paying over 8% at that time. Italy managed to get its rates down to 5% by 1998, roughly the same as the U.S. rate.

    Think about this each time you read some article claiming that the sky is falling in Italy, or that 7% bond interest is the “tipping point.” Think about who profits each time there is a “crisis” and bond CDS rates skyrocket. Think about exactly who is issuing all those press releases with bank analysts offering sober warnings about the sky falling.