End Times and Current Events

http://news.yahoo.com/pressure-mounts-italys-berlusconi-quit-144350508.html

11/7/11

Pressure mounts on Italy's Berlusconi to quit

ROME (AP) — Italy became the latest target in Europe's financial crisis Monday, as soaring borrowing rates intensified pressure on Premier Silvio Berlusconi to resign and let a new government reform the country's spendthrift ways.

Berlusconi batted away reports that he was considering stepping down in favor of early elections, saying they were "without foundation."

But the prospect of financial disaster was real because of Italy's huge debts and slow growth. Unlike Greece, Ireland and Portugal — the three countries that Europe has already bailed out — Italy's economy could be too large to rescue.

Investors want the government to quickly pass measures to boost growth and cut debt. But defections from Berlusconi's coalition government mean he no longer commands enough loyalty to pass the reforms.

Increasingly, Berlusconi is himself being seen as the problem.

If Berlusconi should resign or lose a confidence vote, President Giorgio Napolitano would decide whether to call early elections, or name a government of technocrats rather than politicians. The most widely discussed name to lead a technical government is Mario Monti, the former EU competition commissioner who once blocked General Electric's takeover of Honeywell.

The opposition center-left has long demanded the resignation of Berlusconi, citing sex scandals, criminal prosecutions and legislative priorities it says are aimed at protecting his own business interests rather than those of the country. However, it has failed to come up with a leader who can energize the base and create a credible program, leaving the opposition divided and rudderless.

The ultimate fear is that Italy cannot pay for its euro1.9 trillion ($2.6 trillion) debt and need international help. Europe would struggle with a bailout that large, meaning a default that could break up the 17-nation eurozone and drag down the global economy.

During a G-20 summit last week, Berlusconi had to ask the International Monetary Fund to monitor the country's reform efforts, a humiliating step for the eurozone's third-largest economy.

The yield on Italy's 10-year bonds jumped another 0.42 of a percentage point Monday to 6.67 percent, its highest level since the euro was established in 1999. That is drawing uncomfortably near the 7 percent threshold that forced both Ireland and Portugal to accept bailouts. As yields rise, governments must devote more of their national budgets simply to paying interest costs, creating a vicious circle of debt.

When traders thought early Monday that Berlusconi might resign, those borrowing rates eased. But later in the day, when it was clear the 75-year-old would not leave willingly, rates shot up again, reflecting market fears that he is not the leader who can turn Italy around.

"The leader and his country are in danger of taking the rest of Europe, if not the world, into economic hell," said Louise Cooper, markets analyst at BGC Partners.

Stocks worldwide recovered from big losses as investors responded to the latest twists in Europe's efforts to control its debt crisis, including speculation over Berlusconi's future.

In New York, U.S. indexes were down much of the day on worries over Italy, but a late rally pushed the Dow Jones industrial average back above 12,000 on news that Greece could receive the latest installment of emergency aid as long as its two main parties commit to implementing reforms agreed as part of a European debt package.

The European Central Bank said Monday that it stepped up its program to buy government bonds last week, spending euro9.5 billion ($13 billion). It has been buying bonds for weeks to keep a lid on borrowing costs to help prevent Italy and Spain from succumbing to the debt crisis.

Berlusconi had lunch Monday with his children and friends at his villa near Milan, sparking Italian news media to speculate he was devising an exit strategy. But the lunch is a long family tradition and his Facebook page said "the reports of my resignation are without foundation."

Public administration minister Renato Brunetta, a Berlusconi loyalist, acknowledged Monday that the government has a "numbers problem" in parliament and if a majority is lacking then "everybody goes home." Interior Minister Roberto Maroni agreed, adding "it is useless to persist."

James Walston, professor of political science at the American University of Rome, said Berlusconi's time is quickly running out, even though elections are not due until 2013.

"He could go tomorrow. He could go next week. The sort of pressure that he is under, coming from his own people, will make it sooner than later," he said.

But Berlusconi has remained defiant, insisting he still commands enough support in Parliament.

"I don't understand how rumors of my resignation are circulating," Berlusconi was quoted as saying Monday by Libero newspaper.

Only the loss of a confidence vote can force a government to resign. Opposition leader Pierluigi Bersani said lawmakers are planning exactly that. Political analysts say a vote could come as early as Tuesday, when parliament is expected to approve the state's balance sheets — a routine measure that failed by one vote last month.

Other analysts say should Berlusconi step down, he would seek to have his right-hand man, Gianni Letta, named to succeed him as premier until early elections can be organized. It is not known whether the Italian president, Napolitano, would agree to that.

If the opposition doesn't call a vote of confidence this week in an effort to unseat him, Berlusconi has pledged to call one himself to prove his majority stands, possibly next week, on reforms and other stopgap measures to lower Italy's debt — now near 120 percent of GDP — and revive the dormant economy.

The reform measures include a plan to sell government assets — expected to raise euro5 billion ($6.9 billion) a year for three years — and tax breaks to reduce youth unemployment of 29 percent and to get women back into the work force in a country where just 48 percent of women have jobs. The legislation would also allow stores to stay open on Sundays and open up closed professions.

Berlusconi has also pledged to raise the retirement age to 67 for all to match European trends, despite the fierce resistance of his allies in the Northern League, on whom Berlusconi relies to govern. They have proven at times difficult allies, exerting a strong independent streak and challenging Berlusconi on key policies. The leader, Umberto Bossi, also has on several occasions expressed doubts about Berlusconi's ability to complete the current mandate.

The leader of Italy's largest labor confederation, meanwhile, predicted 2012 will be a "terrifying" year for the economy even if Berlusconi leaves power. CGIL leader Susanna Camusso also slammed Berlusconi's anti-crisis plan as containing virtually nothing to spark economic growth.

"I hope there will be (early elections), and that they will be soon for the good of the country," she told The Associated Press on Monday.

Mario Draghi, an Italian who just took over as European Central Bank president, said last week that since joining the euro, Italy has enjoyed unnaturally low interest rates for years because its monetary policy has been linked to that of stronger economies like Germany.

"For a long time spreads between sovereign bonds in the euro area were very narrow," he said. "They did not reflect the different realities of different countries."

In contrast, German borrowing costs hit a record low Monday, as investors fled to their bonds as a safe haven in Europe.

Is 7% the tipping point for Italy?
7 November 2011, by Jonathan Burton (MarketWatch - Blogs)
http://blogs.marketwatch.com/thetell/2011/11/07/is-7-the-tipping-point-for-italy/

Phil Barach, co-manager with Jeffrey Gundlach of DoubleLine Total Return Bond Fund, which has no European exposure, says:

“ 7% is the crucial number” for the 10-year Italian government bond.

If rates get above 7%, “the markets will perceive that the story for Italy will become like the story for Greece.

There has to be some change there and the problem is that unlike Greece, Italy is huge. There’s no real fix for Italy .”

Barach continued: “ Greece is to the EU like Chicago is to the United States. Italy is probably like California and New York combined.

The EU has to stop dithering and take some decisive action, but it looks like they just can’t get their act together.

By the time they decide to make a decision it might be too late to put out the fire.”

Thousands demonstrate against Berlusconi

11/5/11

ROME (AP) — Tens of thousands of opposition activists demonstrated in central Rome on Saturday for the ouster of Premier Silvio Berlusconi.

Democratic Party leader Pierluigi Bersani told the crowd that his party is prepared to work with other opposition groups to lead a new government.

"If there is discontinuity and change, we are ready with the other opposition to create a new government," Bersani told the crowd in Piazza San Giovani.

Berlusconi's grip on power has been weakened by the ongoing sovereign debt crisis and infighting in his coalition that has prevented clear measures. Six members of his party this week urged him to step aside to allow the formation of a broader coalition with a centrist opposition party.

The protesters, who arrived on buses and trains from throughout Italy, were joined by center-left politicians from France and Germany, as well as a group of **** female demonstrators from Ukraine known as Femen.

"We are not credible. I am ashamed of how other European countries see us. It is pitiful. This man (Berlusconi), this marionette, must go away," said Mario Puddu, a retiree.

Berlusconi has promised a confidence vote on new legislation sought by the European Union to shore up Italy's economy. The measures include a plan to sell government assets, tax breaks to encourage employment for the young, and getting women back into the work force. The legislation would also liberalize store opening hours and open closed professions.

Italy also agreed at a summit in Cannes to have the International Monetary Fund monitor the reform efforts, a humbling step for one of the world's seventh largest economies with the second largest public debt in Europe.

Italy's borrowing costs to service its enormous public debt at 120 percent of GDP have been rising since the summer, raising concerns of a default if Italy. While Europe has bailed out Ireland, Greece and Portugal, euro zone leaders say Italy is too big to bail out.

http://news.yahoo.com/thousands-demonstrate-against-berlusconi-181257982.html

Berlusconi to resign after parliament OKs reforms

http://news.yahoo.com/berlusconi-resign-parliament-oks-reforms-190121172.html

11/8/11

..ROME (AP) — Premier Silvio Berlusconi promised Tuesday to resign after parliament passes economic reforms demanded by the European Union, capping a two-decade political career that has ended with Italy on the brink of being swept into Europe's debt crisis.

Italian President Giorgio Napolitano met for about an hour with Berlusconi after the premier lost his parliamentary majority during a routine vote earlier Tuesday. In a statement, Napolitano's office said Berlusconi had promised during the meeting to resign once the economic reforms have passed parliament.

A vote on the measures is planned for next week.

..

Italy is bust; it’s just a question of when – Italy has a lot of debt, and a lifeless economy8 November 2011, by Matthew Lynn - London (MarketWatch)
http://www.marketwatch.com/story/italy-is-bust-its-just-a-question-of-when-2011-11-08

When a man has survived as many corruption, financial and sex scandals as Silvio Berlusconi has over his two decades in Italian politics, it would be a mistake to assume that a small matter like the imminent bankruptcy of his country will be anything other than a minor setback to his career.

Zero Hedge November 8, 2011

Barclays Says Italy Is Finished: "Mathematically Beyond Point Of No Return" http://www.zerohedge.com/news/barclays-says-italy-finished-mathematically-beyond-point-no-return

BTPs Breach 87 Support, 86.955 Last, ECB Makes A Political Statement By Not Intervening http://www.zerohedge.com/news/btps-breach-87-support-86955-last-ecb-makes-political-statement-not-intervening

L'orrore, L'orrore... In Three Quick Charts http://www.zerohedge.com/news/lorrore-lorrore-three-quick-charts

ECB ‘Inaction’ Succeeds In Doing What Nobody Has Achieved In Decades! Sending Risk Soaring http://www.zerohedge.com/news/ecb-inaction-succeeds-doing-what-nobody-has-achieved-decades-sends-risk-soaring


Zero Hedge November 9, 2011

Market Stalls As LCH Announces Margin Hikes On Italian Debt http://www.zerohedge.com/news/market-stalls-lch-announces-margin-hikes-italian-debt

Italy 10-year yield rises above critical 7% level
9 November 2011, by William L. Watts - Frankfurt (MarketWatch)
http://www.marketwatch.com/story/italy-10-year-yield-rises-above-critical-7-level-2011-11-09

The yield on benchmark Italian 10-year government bonds moved above the critical 7% level widely viewed as unsustainable on Wednesday morning after clearing firm LCH.Clearnet raised margin requirements for trading Italian debt.

The yield IT:10YR_ITA -0.98% was seen at 7.09% in recent action, up 51 basis points from Tuesday, according to FactSet Research.

Sustained yields above the 7% level would translate into borrowing costs that would make it difficult for Italy to maintain funding needs, strategists say.

Worldwide Markets Collapse Following Italian Bond Margin Hike9 November 2011, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/worldwide-markets-collapse-following-italian-bond-margin-hike

Excerpt:

The much dreaded LCH margin hike came and went and while initially the market participants thought it was just a joke as nothing bad is ever allowed to happen anymore in these neverneverland markets, a few hours later the realization that this is all too real has finally dawned.

The result is an epic bloodbath everywhere, but nowhere more so than in Europe, where one can kiss Italian bonds goodbye, and shortly French too, as the bond vigilantes demand that the ECB print now or else.

Visually this is presented as follows: a 30 point drop in the ES, an unseen collapse in Italian bonds, and an explosion in the French-Bund spread.

And since nobody can demonize CDS any more, we expect Europe to make selling sovereign bonds illegal next.

And Now: France
9 November 2011, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/and-now-france

Excerpt:

French Bund spreads have just crossed 147 bps as the "cash bond long yet unable to hedge with CDS" crowd realizes that the Italian contagion is about to hit Paris.

And unable to hedge using creative modern financial instruments, said crowd has reverted to the good old fashioned version thereof.

We call it selling. Expect the spread to hit 150 bps momentarily. 

 

“There Is No Solution for Europe”: Stocks Tumble as Italian Yields Surge
http://finance.yahoo.com/blogs/daily-ticker/no-solution-europe-stocks-tumble-italian-yields-surge-191241349.html

Dow Jones Industrial Average(DJI: ^DJI )
Index Value: 11,780.94
Trade Time: 4:04PM EST
Change:  389.24 (3.20%)
Prev Close: 12,170.18
Open: 12,166.40
Day's Range: 11,736.93 - 12,170.18
52wk Range: 10,362.30 - 12,928.50

http://finance.yahoo.com/q?s=^DJI

http://www.cnbc.com/id/45228690

11/9/11

Market Selloff: 'Contagion Spreading; They've Got to Stop This'

Fears that Italy, the world's third-largest debtor nation, cannot afford its obligations shook world markets, sending investors into the relative safety of the U.S. dollar and Treasurys.

The measure for pain in this latest market drama has been the yield on Italian bonds, which traded above 7 percent for the first time Wednesday, a level viewed as unsustainable by the markets and the level at which Greece, Ireland and Portugal  sought help. The warning signs were also flashing when the yield curve inverted, and 2-year yields rose above the 10-year, which was at 7.25 percent.

Italian Prime Minister Silvio Berlusconi said Tuesday that he would resign after the 2012 budget is approved, which sent risk markets rallying. However, the lack of clarity around Berlusconi's exit concerned markets and Italian bonds continued to feel pressure.

"This is getting to be a game changer, will we have a euro one day? The market is forcing that issue much faster than any time in the past. It was one thing when it was about Greece. If you let Italy go off the cliff, you're questioning why do you have a euro in the first place," said Nomura Americas Treasury strategist George Goncalves.

"You cannot allow the Italian bond market, the third largest market, the biggest in Europe, to trade like a high-yield market," he said of the $2.2 trillion Italian debt market.

Stocks fell sharply in Europe and the U.S., with banks in the lead. German and French equity markets were both down 2.2 percent.

In the U.S., the Dow had its worst day since Sept. 22, losing 3.2 percent to 11,780. The S&P 500 fell 3.7 percent to 1229, just below a key support level, and the S&P financial sector was the worst-performing major sector, down more than 5 percent.

The U.S. bond market was the beneficiary of the fear trade, with 10-year U.S. Treasury yields sliding to 1.95 percent, in an inverse move to bond prices. The dollar index leapt 1.26 points to 77.85, a 1.7 percent increase, as the euro fell towards 1.35.

Meanwhile, Greece, the market's chief source of worry before Italy took center stage, has been moving to restructure its government. But a meeting of political leaders with the country's president was pushed back to Thursday after a deal on a new unity government collapsed. Earlier Wednesday, Greece party leaders were leaning towards house speaker Filippos Petsalnikos to head the country's new coalition government.

Art Cashin, UBS Financial director of floor trading, said the market got even more jittery when the Greek efforts unraveled. "It was more that Greece can't seem to get its act together, and people realizing this thing Italy is going to vote on isn't even written yet," he said.

Rumors swirled through the morning that the European Central Bank  was holding an emergency meeting. The ECB declined comment, but there was also talk it was in the market buying bonds.

"I think the view has been the 'big bazooka' has been the ECB's balance sheet which can buy an unlimited amount of Italian paper. It will not happen without strings attached which means the ECB will only do that if it is effectively in control of the Italian government," said Amitabh Arora, head of asset allocation research at Citigroup.

"I would make a further prediction if Italian yields stay here, we'll see a further deterioration in risk assets," he said. Arora said ECB bond purchases of $10 to $15 billion a week could stem the rise, but it is not a likely outcome.

ECB official Juergen Stark added to the tension Wednesday afternoon, when he warned European governments not to ask for support from the ECB, making it the lender of last resort.

"It's not just Italy. The contagion is spreading. They've got to stop this," said Marc Chandler, Brown Brothers Harriman chief currency strategist. "The French bond spread to the German bund is at a new high. Three month Libor is at its highest level in more than a year... All of this is showing rising tensions."

"As soon as Italy announces a new government, Greece announces a new government it will help ease the political tension," said Chandler, adding the markets may then shift focus to the next country in line, Spain.

Chandler said the euro could see more selling and easily get to 1.34.

"Maybe the Treasury market rallies a little more but bonds for the most part have priced in this negativity, but what happens to oil and stocks?" said Goncalves.

"The Fed will be the grown up in the room. If this thing gets worse, then the Fed will step up and do intra meeting easing," he said.


"The authorities should understand the gravity of the situation. If they don't, then they are admitting defeat and the euro will be called into question."

George Goncalves
Treasury Strategist, Nomura Americas
Berlusconi won a budget vote Tuesday but lost his majority, signaling a lack of confidence in his leadership.

Last week, Berlusconi agreed to have the IMF monitor the country's economic reform efforts, as investors became increasingly wary of his government's efforts to rein in costs.

"The authorities should understand the gravity of the situation. If they don't, then they are admitting defeat and the euro will be called into question," said Goncalves.

The rising Italian yields triggered a move by two key clearing houses to raise margin requirements. This would raise the cost for banks that use Italian bonds as collateral to borrow in the secured lending market.

http://news.yahoo.com/italys-debt-crisis-why-everyone-panicking-113700719.html

11/10/11

Italy's debt crisis: Why everyone is panicking

Fears that Italy will not be able to pay its creditors raises fears of another global economic meltdown

World financial markets erupted in turmoil this week, as fears mounted that Italy could default on its massive government debt. The crisis has already cost Italy's controversial prime minister, Silvio Berlusconi, his job. But why is it scaring people across Europe, and even here in the U.S.? Here, a brief guide:

Is Italy really in such bad shape?
In a word, yes. The country has financed years of lavish social benefits by borrowing and borrowing, piling up $2.6 trillion in sovereign debt. That's 130 percent of the country's gross domestic product of $2 trillion — way beyond what economists say any country can manage for long. As investors lose faith that Italy's leaders will ever get their finances in order, Italy is having to offer a higher and higher interest rate on its bonds just to borrow enough money to get by. On Wednesday, that rate spiked above 7 percent, the tipping point at which economists say a country's debt becomes unsustainable. Shortly after Greece, Portugal, and the Irish Republic hit that level, they had to be bailed out.

Why don't European leaders just rescue Italy, too?
It's too big to bail out. It's basically "Greece on steroids," says Kevin Drum at Mother Jones. Italy's economy is the eighth largest in the world, more than six times larger than Greece's. And Italy owes its creditors more than Greece, Ireland, Portugal, and Spain combined owe. It would take nearly $1 trillion to rescue Italy, Capital Economics' John Higgins tells Forbes, but the European Financial Stability Facility — the EU's bailout fund — has as little as $340 billion left in it.

Can Italian leaders clean up their own act?
Maybe, but it might be too late. Berlusconi's final act was putting together an austerity plan that would slash the country's budget deficit from 3.6 percent of GDP to 2 percent, which is quite low. Take out the interest on its debt, and Italy already runs a surplus. But Italy has let its total debt grow so large that it will have to borrow 300 billion euros — "a massive 19 percent of GDP" — in private capital markets just to pay off bonds that mature in 2012. "No one wants to lend to a country when that country would use the loan to pay the interest on previous loans," says Robert Peston at BBC News, "That's throwing good money after bad."

What happens if Italy defaults?
Many people fear that Italy's collapse could send borrowing costs spiralling higher across Europe, spreading the crisis to other big economies, such as France. To pay off its debts, Italy might even abandon the euro and pay its creditors with a new domestic currency, at a one-to-one exchange. "The currency would then 'float' (i.e., sink)," says The Economist, and the magnitude of its drop in value would determine how much Italy's default would cost the banks and other investors that lent it euros. The losses could cripple Europe's financial system and spark runs on banks in Italy, then in other debt-burdened countries. Businesses would go under. The chaos could "send shockwaves around the world," says Michael Schumann at TIME, "that would rival, even possibly exceed, the ones we saw extend from Wall Street in 2008."

Italy Senate approves 2012 budget law: reports
11 November 2011, by William L. Watts - Frankfurt (MarketWatch)
http://www.marketwatch.com/story/italy-senate-approves-2012-budget-law-reports-2011-11-11

Italy's Senate on Friday approved a budget law that includes new austerity measures, clearing the way for the parliament's lower chamber to pass the legislation on Saturday, news reports said.

The bill is widely expected to win final approval Saturday, clearing the way for embattled Prime Minister Silvio Berlusconi to resign, analysts said.

Financial markets have rebounded from a rout earlier in the week on expectations a technocratic government led by economist and former European Union commissioner Mario Monti will replace the outgoing government

and will move to implement the austerity plan and measures aimed at freeing up the nation's labor markets and other aspects of the economy.
 
 
 
 

http://news.yahoo.com/italys-berlusconi-resign-end-scandal-hit-era-025519711.html

Italy vote clears way for Berlusconi resignation

ROME (Reuters) - The Italian parliament cleared the way for the resignation of Prime Minister Silvio Berlusconi with the approval of a budget law on Saturday, drawing a crowd of revelers to the streets of Rome celebrating his departure.

Once Berlusconi steps down, former European Commissioner Mario Monti is expected to be given the task of trying to form an administration to manage an escalating financial crisis.

Italy, the euro zone's third largest economy, came close to disaster this week when yields on 10-year bonds soared over 7.6 percent, the kind of level which forced Ireland, Portugal and Greece to seek an international bailout.

Berlusconi, who failed to secure a majority in a vote on Tuesday, promised to resign once parliament passed the package of economic reforms, demanded by European partners.

He is due to hand his resignation to President Giorgio Napolitano after a cabinet meeting that will mark the final act of the Berlusconi government and bring an end to one of the most scandal-plagued eras in Italy's post-war history.

Political sources said he was expected at the presidential palace at 2:30 p.m. EST.

Crowds of demonstrators waving banners mocking Berlusconi gathered outside the president's residence at the Quirinale Palace as the billionaire media entrepreneur who has been Italy's longest serving prime minister prepared to depart.

Demonstrators chanting "resign, resign, resign" and "clown, clowns, clowns" also gathered outside the prime minister's office and parliament, heckling ministers as they walked between the two buildings.

"Finally he is leaving. Finally it is over," Renato Cambursano, a deputy in the opposition Italy of Values said during the parliamentary debate that preceded the vote. "This country has lost all its international prestige and the fault is all yours!" he said.

Napolitano is expected to ask Monti to try to form an administration to tackle the financial crisis, threatening to escalate into an emergency across the whole euro zone.

Monti, named by Napolitano as a Senator for Life on Wednesday, is expected to appoint a relatively small cabinet of technocrat specialists to steer Italy through the crisis.

With the next election not due until 2013, a technocrat government could have about 18 months to pass painful economic reforms but will need to secure the backing of a majority in parliament and could fall before then.

With a public debt of more than 120 percent of gross domestic product and more than a decade of anemic economic growth behind it, Italy is at the heart of the euro zone debt crisis and would be too big for the bloc to bail out.

Financial markets have backed a Monti government and as prospects of Berlusconi going became firmer last week, yields dropped below the critical 7 percent level, although they remain close.

"We don't yet have a new government in Italy and we have to wait, but I'm sure if Mario Monti will be appointed he will do whatever is necessary in order to restore the confidence of the financial markets in Italy," Alessandro Profumo, former head of Unicredit, Italy's largest bank, told Reuters.

SIGNS OF OPPOSITION MOUNT

Berlusconi, fighting an array of scandals and facing trials on charges ranging from tax fraud to paying for sex with an under-aged prostitute, had been under pressure to resign for weeks as the market crisis threatened to spin out of control.

International leaders including President Barack Obama, French President Nicolas Sarkozy and the head of the International Monetary Fund Christine Lagarde have expressed hopes a new government can be in place quickly.

Talks with Italian political parties are expected to begin on Sunday with hopes that a new government can be in place in time for the opening of financial markets on Monday.

However, even as preparations for a transition begin, signs of opposition have appeared, with Berlusconi's PDL party split between factions ready to accept a Monti government and others deeply opposed.

Berlusconi had a working lunch with Monti before the vote, suggesting the outgoing government will not try to block a quick handover, but the attitude of the center-right as a whole remains unclear.

The PDL's main coalition ally, the regional pro-devolution Northern League, has declared it will go into opposition, underlining the risk that the new government will lack the broad parliamentary support it will need to pass deep reforms.

"The convulsions in the center-right at the prospect of a government led by Mario Monti signal a danger: that a divided coalition may be tempted to unload its divisions on the country," the daily Corriere della Sera said.

The center-left Democratic party and smaller centrist parties have pledged support to Monti. Italy's main business and banking associations and some of the moderate trade unions have also called for a government of national unity.

However, the support of the left will be tested if the new government tries to implement the kind of tough reforms to pensions and job protection measures that have drawn strong opposition from unions in the past.

In another warning of the kind of personal attacks he may soon face, the fiercely pro-Berlusconi Il Giornale daily declared Monti had joined "the caste," the tag given to Italy's deeply unpopular political elite.

"SuperMario joins the caste: 25,000 euros a month," it said in a front page article that referred to the salary Monti will receive following his appointment as senator for life by Napolitano this week.

(Additional reporting by Megan Davies in Moscow; Writing by Philip Pullella and James Mackenzie; Editing by Janet Lawrence)

Chairman of the European Branch of the Trilateral Commission and Bilderberg Member Becomes Leader of Italy
November 14th, 2011


Mario Monti, the economist who will head an emergency Italian government following the departure of Silvio Berlusconi, brings credentials earned in a decade of battles as a European Commissioner from the 1990s.

…

He is chairman of the European branch of the Trilateral Commission, a body that brings together the power elites of the United States, Europe and Japan and is also a member of the secretive Bilderberg Group of business leaders and other “leading citizens”.

http://www.reuters.com/article/2011/11/14/italy-monti-idUSL5E7MD0DO20111114

http://news.yahoo.com/monti-wind-consultations-italy-government-004014540.html

11/15/11

Monti due to present new Italian government

ROME (Reuters) - Prime Minister designate Mario Monti is expected to unveil Italy's new government on Wednesday after an intense two days of consultations aimed at staving off a major financial crisis that has pushed Italy's borrowing costs to untenable levels.

The presidential palace said Monti would meet President Giorgio Napolitano at 11 a.m. (10 GMT) to tell him formally that a government could be formed.

Monti told reporters Tuesday night the "framework is now clearly delineated" for his government but declined to give details, saying he would work them out "in the next few hours" and brief the president Wednesday before announcing them.

Italian media said he would go to the meeting with Napolitano with his cabinet list ready. It was not clear when the government would be sworn in.

The government, expected to be made up of technocrats, will have to tackle a crisis that has brought Italy to the brink of economic disaster and endangered the entire euro zone.

"I would like to confirm my absolute serenity and conviction in the capacity of our country to overcome this difficult phase," Monti said.

Before the end of the week, the new government is expected to outline its program and seek confidence votes from parliament, which will formally invest it with power.

Monti, who won the backing of all political forces except the Northern League, must push through a tough austerity program demanded by European leaders to restore shattered confidence in Italy and take market pressure off the country.

Yields on Italy's 10-year BTP bonds climbed to over 7 percent Tuesday, the level at which Greece and Ireland were forced into bailouts. [size=14]Italy is too big to be bailed out with the resources currently available[/size].

Emma Marcegaglia, head of the employers association Confindustria, told reporters after meeting Monti: "We said we will support his government very strongly. We think this government is the last chance for Italy to exit from this situation of emergency."

Crucial to Monti's success was the backing of the PDL party of outgoing prime minister Silvio Berlusconi, who was forced to step down Saturday by the fast-worsening crisis.

Napolitano, who has engineered the extremely rapid government transition in response to the collapse of confidence in Italy, nominated Monti for the premiership Sunday night.

The president has called for an extraordinary national effort to win back the confidence of markets, noting that Italy has to refinance some 200 billion euros ($273 billion) of bonds by the end of April.

Monti said his government should last until the next scheduled elections in 2013, despite widespread predictions that politicians intend to give him only enough time to implement reforms before precipitating early polls.

Monti Forms New Italian Government

ROME — Mario Monti, Italy’s prime minister-designate, unveiled his cabinet on Wednesday and named himself as finance minister, underscoring the urgency to repair the country’s teetering economy at a moment of Europe-wide economic instability.

Mr. Monti said he hoped the new government could restore market confidence and soothe a tense political climate. “We worked seriously and paid close attention to the quality of the choices,” he said at a news conference. He added that he had been encouraged by Italy’s European partners and the international community and that the rapid formation of the government would relieve the pressure of markets on Italy.

The ministers are drawn mostly from Italy’s academic world, some with strong ties to the Catholic Church, but also banking and the upper echelons of civil service.  

rest: http://www.nytimes.com/2011/11/17/world/europe/monti-forms-new-italian-government.html

Italy yield edges up, Spain down; ECB seen buying
18 November 2011, by William L. Watts - Frankfurt (MarketWatch)
http://www.marketwatch.com/story/italy-yield-edges-up-spain-down-ecb-seen-buying-2011-11-18

Italy's 10-year government bond yield erased an earlier decline, while Spain's yield remained lower Friday morning.

Strategists had reported a further round of purchases by the European Central Bank.

Yields fall as bond prices rise.

The yield on 10-year Italian government bonds edged up 1 basis point to 6.72%, while Spain's 10-year yield fell 9 basis points to 6.35%, according to FactSet Research.

The extra yield demanded by investors to hold Italian 10-year bonds over German bunds rose slightly to 4.8 percentage points, while the spread between Spanish and German 10-year yields narrowed by around 10 basis points to 4.46 percentage points.

France's 10-year yield fell by around 10 basis points to 3.53%, narrowing the spread over the German 10-year yield to 1.65 percentage points after hitting a euro-era record at 2 percentage points earlier this week.

A basis point is one-hundredth of a percentage point.

Is 16-Times-The-Charm For ECB BTP Interventions?
18 November 2011, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/16-times-charm-ecb-btp-interventions

Excerpt:

While the disquieting calm (before the storm) of the last hour in European markets suggests traders sitting on their hands into a bazooka-ridden weekend, we thought a look at what happens when the ECB stops playing may help.

Based on the velocity of price-jump, the last two weeks have seen at least 16 interventions by the ECB into the BTP market and still the price is down significantly.

Most importantly, on the two occasions when the ECB has deemed to let free markets reign, we have seen BTP prices free-fall.

Have a great weekend, Europe.

http://www.telegraph.co.uk/news/worldnews/europe/italy/8895003/New-Italian-government-does-not-include-a-single-elected-politician.html

New Italian government does not include a single elected politician

Mario Monti, Italy's new prime minister, appointed a government without a single politician on Wednesday, forming a technical administration which faces the daunting challenge of preventing the country from being dragged deeper into the euro zone debt crisis.

The emergency administration, which is meant to govern Italy until elections are due in 2013, is made up of bankers, lawyers and university professors but not a single elected official – an extraordinary development for a Western democracy.

But it is a deal that much of the electorate and nearly all the mainstream parties have signed up to, in order to save Italy from the economic abyss by trimming the country's bloated bureaucracy, slashing its 1.9 trillion euro debt and unleashing its economic potential after years of stagnation.

Almost none of the new appointees was familiar to the average man or woman in the street – a fact that some Italians hailed as the new administration's chief strength, saying it was above party politics and untainted by any links to the discredited centre-Right government of Silvio Berlusconi or the weak and divided centre-Left opposition. Italy has a track record of appointing 'technical' governments during periods of political paralysis and party deadlock.

------------------------------------------------------------------------------------

They have complained vociferously that he was forced to stand down not by a democratic process but by a "coup d'etat" engineered by Brussels, bankers and the financial markets.

Mr Berlusconi has said that he was not constitutionally obliged to resign, because the vote he lost in parliament last week was not a confidence vote, and that his decision to step down was an act of self-sacrifice and "responsibility".

Read More

ITALIAN DEBT FUNDING COSTS SOAR


Via: Reuters:

Italy paid a record 6.5 percent to borrow money over six months on Friday and its longer-term funding costs soared far above levels seen as sustainable for public finances, raising the pressure on Rome’s new emergency government.

The auction yield on the six-month paper almost doubled compared to a month earlier, capping a week in which a German bond auction came close to failing and the leaders of Germany, France and Italy failed to make progress on crisis resolution measures.

Though Italy managed to raise the full planned amount of 10 billion euros, weakening demand and the highest borrowing costs since it joined the euro frightened investors, pushing Italian stocks lower and bond yields to record highs on the secondary market.

http://www.reuters.com/article/2011/11/25/us-italy-bonds-auction-idUSTRE7AO0EL20111125

http://www.zerohedge.com/news/uncle-sam-rescue-after-all-latest-rumor-sees-%E2%82%AC600-billion-bailout-italy-us-pardon-imf

11/27/11

Uncle Sam To The Rescue After All: Latest Rumor Sees €600 Billion Bailout Of Italy From US, Pardon IMF

The European desperation is palpable ahead of the EURUSD open in a few hours, which has to deal with the aftermath of the Friday afternoon downgrade of Belgium, the junking of Portugal and Hungary, and the prospect of an imminent downgrade of AAA-stalwarts Austria and France. So what does Europe do instead of actually proposing the inevitable debt repudiation that is the only and final outcome? Why more rumors of course. To wit: last night saw the preannouncement of Welt am Sonntag indicating that in order to bypass the lengthy process of treaty changes, Europe would instead proceed with bilateral agreements that would somehow enforce fiscal stability and convince the market that European states would follow the German leader. Well since that is sure to have absolutely no impact, overnight Italian La Stampa is out with a fresh new rumor which cites "IMF sources" according to which the US-headquartered and funded organization would provide a €600 billion loan to Italy at 4-5%. In other words, Uncle Sam, in his role as primary funding agent of the IMF would lose massive amount of money on the "market to fair value" arbitrage, only to bail out the latest European domino. As a reminder, the whole "under market rates" loan from the IMF was implemented in Greece and worked out just swell: at last check the 1 Year Greek bond was trading with a yield of over 300%. Oh, and La Stampa forgot to mention one thing: any changes to the IMF, which currently is massively underfunded and is why the organization was forced to create two new liquidity facilities: a Precautionary and Liquidity Credit line, since it is unable to fund its New Arrangements to Borrow, have to go through US Congress when it comes to expanding funding capacity. Yup, the most dysfunctional, corrupt and criminal thing in the world - the US House of Representatives, where unless everyone is short Italian CDS, this will never pass. In other words: this rumor is dead in the water.

read more

Italy's Monti seeks broad support for crisis measures
http://finance.yahoo.com/news/italys-monti-seeks-broad-support-163014318.html?l=1

12/3/11

ROME (Reuters) - Italian Prime Minister Mario Monti met party leaders on Saturday to drum up support for new measures aimed at shoring up public finances, helping growth and calming the debt crisis in the euro zone's third largest economy.

Italy's cabinet is set to approve the package of reforms on Monday, a step seen as vital for re-establishing Italy's shattered credibility with financial markets after a series of unfulfilled promises by the previous government.

The plan will then be outlined during two news conferences - one with foreign reporters - and presented in both houses of parliament in the afternoon.

Government sources familiar with the plan say the mix of cuts and tax rises will total about 20-25 billion euros over the next two years, about half of which will be used to reduce the budget deficit and help balance the budget by 2013 despite the economic downturn and rising borrowing costs.

The rest will free up resources to try to regenerate Italy's recession-bound economy.

read more

http://news.yahoo.com/monti-warns-greek-style-risk-italy-231112074.html

12/5/11

Monti warns of Greek-style risk to Italy

ROME (Reuters) - Italy risked a Greek-style economic collapse which could threaten the future of the euro without the austerity package approved by the government, Prime Minister Mario Monti said on Monday, calling on European partners to do their part.

Monti's announcement of the plan on Sunday kicked off one of the most crucial weeks since the launch of the euro more than a decade ago, ending with a summit of European leaders in Brussels on Thursday and Friday to seek a wider set of crisis measures.

"If Italy were not capable of reversing the negative spiral of growth in debt and restoring confidence to international markets, there would be dramatic consequences, which could go as far as putting the survival of the common currency at risk," Monti told parliament.

"Italy is ready to do what it has to do but Europe must not fail to do its part," he said.

The package, dubbed a "Save Italy" decree by Monti, aims to raise more than 10 billion euros ($13.4 billion) from a property tax, impose a new levy on luxury items like yachts, raise value added tax, crack down on tax evasion and increase the pension age.

read more

Italy leads bond yields higher after S&P warning
6 December 2011, by William L. Watts - Frankfurt (MarketWatch)
http://www.marketwatch.com/story/italy-leads-bond-yields-higher-after-sp-warning-2011-12-06

European government bonds fell, sending yields higher Tuesday, a day after Standard & Poor's Ratings Services put the credit ratings of 15 euro-zone countries on negative watch.

The move encompassed all euro members other than Cyprus, which was already on negative watch, and Greece, whose CC rating already signals a high risk of default.

The 10-year yield on Italian government bonds, which had fallen sharply on Monday, rose 20 basis points to 6.05%.

Spain saw its 10-year yield rise 4 basis points to 5.17%,

while France's 10-year yield rose 6 basis points to 3.19%.

Germany saw its 10-year yield rise 2 basis points to 2.23%.

http://news.yahoo.com/monti-sees-little-room-amend-italy-austerity-plan-213850485.html

12/6/11

Monti sees little room to amend Italy austerity plan


..ROME (Reuters) - Italian Prime Minister Mario Monti moved on Tuesday to head off any attempts by political parties to water down his 30 billion euro austerity package with amendments in parliament, saying Italy had little time at its disposal to approve the plan.

Speaking in a prime time television interview, Monti brushed off calls from lawmakers among the parties he depends on for a majority to amend measures such as a housing tax, raising the retirement age or suspending inflation indexation of pensions.

"There is little time and the margins of flexibility are minimal," he said when asked about the possibility of amending his proposals for pension reform.

Welfare Minister Elsa Fornero, speaking on another television talk-show, said she was willing to re-consider the de-indexation of pensions if parliament could come up with another way of finding the necessary savings.

The austerity plan, approved by the cabinet on Sunday, is immediately effective but must be passed by parliament within 60 days or it expires. It is expected to be approved before the end of the year.

..

http://finance.yahoo.com/news/italys-monti-faces-confidence-vote-234102912.html?l=1

12/15/11

Italy's Monti faces confidence vote on austerity

ROME (Reuters) - Italy's government faces a confidence vote in parliament on Friday, a move to speed up approval of a 33-billion euro ($43 billion) austerity package intended to restore market confidence in the euro zone's third largest economy.

Mario Monti's government of unelected technocrats has an overwhelming majority in both houses of parliament and the vote, to be held in the Chamber of Deputies in the afternoon, should pass easily.

The austerity plan will then move to the Senate, where a similar vote is expected to be held before Christmas, marking the final passage of a decree law that went into effect on December 4 but needed parliamentary approval within 60 days.

Monti's government was appointed last month to face a collapse in market confidence that put Italy at the heart of the euro zone debt crisis. He has raced to push through the package of tax hikes, spending cuts and pension reform aimed at meeting Italy's goal of balancing its budget in 2013.

read more

Italy's Senate approves emergency austerity plan
23 December 2011, by Barbara Kollmeyer - Madrid (MarketWatch)
http://www.marketwatch.com/story/italys-senate-approves-emergency-austerity-plan-2011-12-23

Italy's Prime Minister Mario Monti secured approval for his €30 billion ($39 billion) emergency austerity package, media reports said.

The package won a final confidence vote in the Senate after a lengthy debate Thursday evening.

Italy's two main parties, the center-right People of Freedom and the center-left Democratic Party, have opposed the plan, but backed it in the end "for a sense of responsibility."

Monti had called a confidence vote in both parliament chambers to try and speed up the package. The lower house of parliament passed the package last Friday.

Italian 10-year yield rises back above 7%
6 January 2012, by William L. Watts - Frankfurt (MarketWatch)
http://www.marketwatch.com/story/italian-10-year-yield-rises-back-above-7-2012-01-06

Italian and Spanish government bonds were under pressure Friday, pushing up yields as both countries prepared to auction debt next week in a key test of market confidence.

The yield on 10-year Italian government bonds rose back above the 7% level to trade at 7.11%, a rise of 16 basis points.

Borrowing costs above 7% are widely seen as unsustainable over the long run.

Spain's 10-year bond yield rose by around 5 basis points to 5.63%.

ECB buys Spanish, Italian bonds: report
6 January 2012, Frankfurt (MarketWatch)
http://www.marketwatch.com/story/ecb-buys-spanish-italian-bonds-report-2012-01-06

The European Central Bank stepped into bond markets again on Friday to buy Spanish and Italian government debt after yields jumped ahead of expected auctions by both nations next week, The Wall Street Journal reported.

The ECB has been a regular buyer of Spanish and Italian debt in the secondary market through its Securities Market Program since early August, traders say.

Italy's 10-year yield remained at 7.09%, a rise of 15 basis points from Thursday, but off an intraday high near 7.14%.

Yields rise as bond prices fall.

A yield of more than 7% is viewed as potentially unsustainable for government borrowers over the long run.

Spain's 10-year yield fell to 5.55%, down 3 basis points on the day and well off an intraday high around 5.65%.

Italy plans gradual liberalisation to boost economy
8 January 2012, Catherine Hornby - Rome (Reuters)
http://www.reuters.com/article/2012/01/08/us-italy-liberalisation-idUSTRE8070QE20120108

Excerpt:

Italian Prime Minister Mario Monti plans liberalisation steps to promote competition in several industry sectors and revive the ailing economy, he said on Sunday, ahead of meetings with European partners to discuss ways to stem the debt crisis.

The liberalizations, which will seek to reduce privileges for dominant companies, will be included in a new set of growth-enhancing reforms due to follow the €33 billion austerity plan passed last month.

ECB Resumes Buying Bonds With Gusto As Italian Yields Remain Well Wide Of 7%
9 January 2012, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/ecb-resumes-buying-bonds-gusto-italian-yields-remain-well-wide-7

Italian Bonds Surge To Early November Wides
9 January 2012, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/italian-bonds-surge-early-november-wides

Italian Banks Plunge On Capital Raise Concerns
9 January 2012, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/italian-banks-plunge-capital-raise-concerns

Monti warns of anti-EU unrest in Italy

http://www.presstv.ir/detail/220488.html

1/11/12

Italian Prime Minister Mario Monti has warned that his austerity measures might trigger anti-European protests in his country, pleading for more help from the EU to stem its debt crisis.
 

“I am demanding heavy sacrifices from Italians,” Monti said in an interview with German newspaper Die Welt published on Wednesday.
 
“I can only do this if concrete advantages become visible.” If not, “a protest against Europe will develop in Italy, including against Germany, which is seen as the ringleader of EU intolerance, and against the European Central Bank,” Monti added.
 
Monti, who has pushed through a crushing austerity plan demanded by the European Union, is in Berlin for talks with German Chancellor Angela Merkel on stemming the debt crisis. The two leaders are due to hold a news conference later today.
 
"Unfortunately, we have to say that our reform policies have not received the recognition and appreciation in Europe that they deserve," the premier added.

read more

Bank of Italy forecasts sharper recession in 2012
17 January 2012, (AFP)
http://www.france24.com/en/20120117-bank-italy-forecasts-sharper-recession-2012-0

The Bank of Italy forecast Tuesday an economic contraction of between 1.2% and 1.5% this year depending on borrowing costs, a much sharper decline than the government's estimate of 0.4%.

"The uncertainty that surrounds the medium-term perspectives of the Italian economy ... are extraordinarily high and are directly linked to the evolution of the eurozone debt crisis," the central bank said in its economic bulletin.

The bank advanced two scenarios, each based on interest Italy must offer to borrow on sovereign bond markets.

The first scenario was calculated with a rate of about 7.0% currently demanded by investors for 10-year Italian debt and widely considered to be unsustainable.

Under these circumstances, the bank said, the Italian economy would contract by 1.5% in 2012 and would remain stalled in 2013.

Italy wants EU bailout fund doubled - German magazine
21 January 2012, Berlin (Reuters)
http://uk.reuters.com/article/2012/01/21/uk-eurozone-italy-idUKTRE80K0OJ20120121

Italian Prime Minister Mario Monti wants the lending capacity of the euro zone's permanent rescue fund to be doubled to €1 trillion ($1.29 trillion), German magazine Der Spiegel wrote on Saturday, without citing sources.

"Monti argues that such a measure would create confidence in the currency union," Spiegel wrote.

"He has informed the German government of his wishes."

Spiegel said Monti's fellow countryman and European Central Bank President Mario Draghi agreed the European Stability Mechanism (ESM) should beef up its effective lending capacity beyond the €500 billion planned.

He believes the leftover funds from the European Financial Stability Facility (EFSF), the temporary €440 billion fund lending to Ireland and Portugal, should be put at the ESM's disposal in addition to the €500 billion, Spiegel wrote.

The draft treaty establishing the ESM will be discussed by euro zone finance ministers on Monday and is likely to be approved by EU leaders at a summit on January 30, euro zone officials said last week.

S&P Downgrades 34 Of 37 Italian Banks - Full Statement
10 February 2012, Tyler Durden (Zero Hedge)
www.zerohedge.com/news/sp-downgrades-34-37-italian-banks-full-statement

http://news.yahoo.com/euro-crisis-cash-strapped-italy-sells-off-iconic-170445200.html

2/22/12

The Italian island of Sardinia is leasing several formerly state-owned, out-of-use lighthouses to private developers who plan to capitalize on their pristine coastal surroundings.

They command stunning coastal views of one of the Mediterranean’s least spoiled islands, but now, as Italy’s new government attempts to chip away at the country’s €1.9 trillion ($2.5 trillion) debt, a clutch of abandoned but picturesque lighthouses on the island of Sardinia will be sold off.

The sale is part of the Italian government's efforts to balance the books by capitalizing on a valuable portfolio of state-owned property, from disused Army barracks to castles, former convents, and even islands. The lighthouses, which overlook the powder-white beaches and turquoise bays that have made Sardinia such a tourist magnet, are to be leased to private businesses and converted into unusual hotels, galleries, and museums.

They are being offered for sale by the island’s autonomous government. Squeezed by the drastic cuts announced by Prime Minister Mario Monti, the sober technocrat appointed in November, the island's government can no longer afford the cost of maintaining the lighthouses, much less restoring them.

more

Yields on Italian, Spanish debt rise
6 March 2012, by Deborah Levine - New York (MarketWatch)
http://www.marketwatch.com/story/yields-on-italian-spanish-debt-rise-2012-03-06

Spain and Italy's cost of borrowing rose on Tuesday after a report said a Greek default would likely force Italy and Spain to seek aid.

However, the move took yields back to levels about a week ago, at worst - just before the European Central Bank's latest mammoth lending operation.

Spain's 10-year yields rose as high as 5.05% from 4.95% on Monday.

They topped 5.60% at the beginning of the year.

Italy's 10-year yields increased 10 basis points, or 0.1%, to 4.97%, though still near their lowest levels since last fall.

Italy's 2-year yields increased 3 basis points to 1.80% and Spain's were up 5 basis points to 2.31% -- both still down significantly from a week ago.

http://news.yahoo.com/italy-politics-tumult-northern-league-head-berlusconi-ally-120013369.html

4/6/12

Italy politics in tumult after Northern League head, Berlusconi ally quits in finance scandal

ROME - The once-charismatic head of the Northern League, the anti-immigrant party that for two decades was Silvio Berlusconi's critical ally, has called for his party to do the right thing amid a finance scandal that forced his resignation.

A chastened Umberto Bossi said Friday the League was in a "dangerous" situation, under the spotlight by Rome prosecutors investigating alleged party payments to his family members and under criticism by deceived party faithful.

Bossi was meeting Friday with Roberto Maroni, Berlusconi's onetime interior minister and one of three League officials who have been tapped to guide the party following Bossi's abrupt resignation Thursday.

Bossi blamed "thieving" Rome prosecutors for stirring the scandal, but acknowledged the need for clarity.

http://news.yahoo.com/analysis-fat-cat-italian-politicians-dodge-montis-austerity-144638131.html

Analysis: Fat cat Italian politicians dodge Monti's austerity

4/11/12

ROME (Reuters) - When Prime Minister Mario Monti called on all Italians to make sacrifices to avert a Greek-style crisis, the political class that backs him in parliament wasn't listening.
 
While most voters face higher taxes, stagnating wages and rising unemployment, Italy's army of politicians and senior officials are clinging to fat salaries that far outstrip those of their peers abroad.
 
Monti, a technocrat who relies on party politicians to get his austerity policies through parliament, recently issued a decree which will prevent public servants earning more than U.S. President Barack Obama. Many now earn considerably more.
 
Ordinary Italians are paying the price for a decade of political stalemate, profligate spending and corruption.

more

Italy to delay balanced budget by a year: report
18 April 2012, by William L. Watts - Frankfurt (MarketWatch)
http://www.marketwatch.com/story/italy-to-delay-balanced-budget-by-a-year-report-2012-04-18

The Italian government will delay its plan to reach a balanced budget in 2013 by a year due to a weaker economic outlook, Reuters reported Wednesday, citing a draft document expected to be approved by Prime Minister Mario Monti's cabinet later in the day.

The plan raises Italy's 2012 deficit target to 1.7% of GDP from 1.6%, the report said, while the 2013 goal is raised to 0.5% from 0.1%.

The plan calls for a nearly balanced budget, with a deficit of 0.1% of GDP, in 2014.

Italy has one of the smallest deficits in the euro zone but is struggling to convince investors it can rein in the size of its overall debt pile, which at around 120% of GDP is second only to Greece in the euro zone.

French Bonds Drop Before Election as Italian Debt Slides
21 April 2012, by Anchalee Worrachate (Bloomberg)
http://www.bloomberg.com/news/2012-04-21/french-bonds-drop-before-election-as-italian-debt-slides.html

French bonds declined, sending 10- year yields to the highest in almost three months, as investors braced for tomorrow’s election amid concern that European policy makers are failing to contain the region’s debt crisis.

Italian 10-year bond yields rose for a sixth week, the longest run since November, as Prime Minister Mario Monti pushed back his balanced-budget goal.

France will hold the first of two rounds of votes to choose a president, with Socialist Francois Hollande seeking to replace Nicolas Sarkozy.

The rise in France’s yields reflects investor concern that Hollande may relax the nation’s deficit-tackling policy if he takes office, according to Charles Diebel, head of market strategy at Lloyds Banking Group Plc.

“The French election is going to keep people nervous, particularly with comments Hollande is making,” London-based Diebel said.

“With a number of risk events ahead of us, the market is going to re-challenge policy makers.”

French 10-year yields advanced 13 basis points, or 0.13 percentage point, from last week to 3.08% at 4:06 p.m. London time yesterday.

That’s the biggest increase since the five days ended Jan. 6.

The extra yield investors get for holding the securities instead of German bunds rose to as much as 149 basis points, the most since January.

The price of the 3% securities due in April 2022 fell to 99.33 from 100.43.

Italian 10-year bond yields rose 13 basis points to 5.65%.

The rate on benchmark 10-year German bunds slipped two basis points to 1.72%.

more

http://news.yahoo.com/italy-borrowing-costs-rise-eurozone-woes-grow-111157843--finance.html

Italy borrowing costs rise as eurozone woes grow

4/24/12

ROME (AP) — Italy has seen its borrowing costs rise as it raised some €2.5 billion ($3.3 billion) in bonds in a market jittery over the French elections and political instability in the Netherlands.

Italy had to pay an interest rate of 3.3 percent in the auction of two-year bonds on Tuesday, up from 2.3 percent at the last such auction, but below the 4.8 percent paid as recently as January.

Analysts had expected borrowing costs would reflect political developments in the wider eurozone as well as Italy's decision to delay its target for a balanced budget from 2013 to 2015.

Rising Italy-to-Spain Yields Keep Banks on Life Support
25 April 2012, by Liam Vaughan and Gavin Finch (Bloomberg)
http://www.bloomberg.com/news/2012-04-24/rising-italy-to-spain-yields-keep-banks-on-life-support.html

Excerpt:

European lenders, more reliant than ever on emergency aid after borrowing $1.3 trillion from their central bank, may need additional cash infusions until policy makers stem the crisis engulfing Spain and Italy.

After more than 30 bond sales in the first quarter, no bank has sold unsecured debt this month, and the cost of insuring against default has soared to levels last seen in January.

Financial stocks, which rallied 20% following the European Central Bank’s December decision to provide unlimited three-year loans, are now 2% lower since then.

Investors are balking after some lenders used the ECB cash to boost holdings of sovereign debt and governments struggled to rein in deficits.

Because banks post collateral in exchange for the ECB loans, the amount unsecured bondholders would get back in a default has shrunk.

That has raised funding costs for what Morgan Stanley estimates is about €700 billion ($924 billion) of debt lenders must refinance by the end of 2013.

“There is a very compelling case for further intervention from the ECB,” said Barbara Ridpath, chief executive officer of the International Centre for Financial Regulation, a London- based research group funded by banks and the U.K. government.

“Many of these banks simply cannot refinance their maturing debt in the bond market.”

Italian Business Confidence Drops to Lowest in Two Years
26 April 2012, by Lorenzo Totaro and Chiara Vasarri (Bloomberg)
http://www.bloomberg.com/news/2012-04-26/italian-business-confidence-drops-to-lowest-in-xx-months.html

Excerpt:

Italian business confidence unexpectedly fell to the lowest level in more than two years in April amid concerns that the country’s fourth recession in a decade may deepen.

The manufacturing-sentiment index dropped to 89.5 from a revised 91.1 in March, Rome-based national statistics institute Istat said today. Economists had predicted a reading of 92.1, according to the median of 11 estimates in a Bloomberg News survey.

“It is premature to say whether today’s decline in business sentiment might be a temporary blip or a signal of a more protracted phase of very weak economic activity,” Unicredit economists Chiara Corsa and Loredana Federico wrote in a note today.

“Still, taken at face value the April figure is consistent with a GDP contraction at the beginning of the second quarter.”

Prime Minister Mario Monti’s Cabinet, which is implementing a €20 billion ($26.4 billion) austerity plan to eliminate the deficit, lowered its forecasts for the euro-region’s third- biggest economy on April 18, saying it will contract 1.2% this year.

The Treasury also forecast that unemployment, at an 11-year high of 9.3%, won’t start declining until 2013.

Italy Unemployment Rises to 12-Year High as Slump Worsens
2 May 2012, by Lorenzo Totaro (Bloomberg)
http://www.bloomberg.com/news/2012-05-02/italy-unemployment-rises-to-x-year-high-as-slump-worsens.html

Italy’s unemployment rate rose more than economists forecast in March to the highest since 2000 as companies failed to hire amid signs of a deepening recession in the euro region’s third-largest economy.

Joblessness increased to a seasonally-adjusted 9.8% from a revised 9.6% in February, Rome-based national statistics office Istat said in a preliminary report today.

The reading, the highest since the third quarter of 2000, compared with a 9.4% median estimate by nine economists surveyed by Bloomberg News.

After slipping into its fourth recession since 2001 in the final three months of last year, the Italian economy probably shrank again in the first quarter as rising joblessness undermined domestic demand, employers’ lobby Confindustria said on April 18.

Prime Minister Mario Monti’s Cabinet last month forecast the economy will contract 1.2% this year.

The Rome-based Treasury also predicted that unemployment won’t start declining until 2013.

“Unemployment will keep soaring sharply as the conditions that caused it will remain,” Confindustria said last month.

“There will be more job cuts and an increase in people looking for employment amid a decline in real income.”

The Italian parliament will debate this month an overhaul of the labor code that the government says will spur employment.

The plan gives employers more leeway to fire staff and creates a new system of unemployment benefits.

The initiative is Monti’s fourth major legislative effort to revamp the economy after measures in December aimed at reducing Italy’s deficit and two packages earlier this year to make the country more competitive and to simplify bureaucracy.

Istat originally reported a jobless rate of 9.3% in February.

European Spreadwatch Alert As Italian Bank Borrowings From ECB Rise To New Record
8 May 2012, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/european-spreadwatch-alert-italian-bank-borrowings-ecb-rise-new-record

Excerpt:

It may not be a big rise, but the €1 billion increase in Italian bank borrowings from the ECB, from €270 billion to €271 billion in Apirl as just reported by the Bank of Italy, is still a record, and not one Italy should be proud of.

The Spanish bank update is pending and will be out in a few days, although if the recent about face by Rajoy, admitting the Spanish banks are about to be nationalized, which today is no longer sending the markets higher, is an indication, it won't be a vast improvement.

Sure enough, the fact that the market's attention is once again drawn to an indicator of the PIIGS financial sector insolvency is not good for sovereign spreads and at last check everyone was wider, core and periphery together, as

Spain was+5.3 bps,

Italy +3.8 bps,

Netherlands +0.3 bps, and

France 1.8 bps.

Even the futures are shocking not green on more bad news.

Italian Economic Deterioration Accelerates: Q2 GDP Forecast To Drop More Than 1%
10 May 2012, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/italian-economic-deterioration-accelerates-q2-gdp-forecast-drop-more-1

Overnight we got some good news on Italian industrial production.

Well, get ready to scrap them as according to Italian Trade Union Confindustria, and validating the collapse as predicted by PMI indicators,

Italy's Q2 GDP is now expected to shrink more than 1% in Q2: the worst print since 2009, cementing the country's "double dip", and that real-time industrial output in April, now that LTRO has fizzled, is expected to fall 0.6%.

None of this should come as a surprise to anyone: after all the only way the periphery can rise is if it crashes hard enough to force the ECB to intervene again.

Finally, the country that is next in line after Spain to nationalize its banks, need some pretext after all.

Complete economic collapse will surely make stockholders, of other countries' banks at least, happy, as their Italian counterparty risk will soon be footed by the Italian taxpayers themselves.

This is what Italian GDP has been recently. A -1.0%+ print will not make anyone happy.

http://globaleconomicanalysis.blogspot.com/

Tax Collection Violence in Italy: Mail Bombs in Rome, Police Clashes in Naples, Molotov Cocktails in Livorno


Violent protests against the hated Equitalia, the Italian tax collection agency, are making headlines in several cities in the past few days. In Rome mail bombings have been ongoing since December. Via Google Translate, this time in Italian, please consider a trio of articles.

Equitalia, six months of mail bombs
 MILAN - Equitalia once again in the crosshairs. After the envelope with gunpowder delivered Friday to the see of Rome, in Via Giuseppe Grezar, last night, two Molotov cocktails were thrown against the door of the agency's headquarters in Livorno. This is the latest in a long series of parcel bombs and suspicious envelopes arrived in recent months in various offices of the Italian society of recovery.

THE FIRST PACKS-BOMB - The first package bomb delivered to Equitalia comes in via Millevoi, in Rome, December 9 last year. The bomb explodes in the hands of the director general, Mark Cockaigne, that is wounded in the hand and eye. On 12 December a large firecracker exploded outside the headquarters of the agency Equitalia in Naples. The explosion causes damage of the lower part of the gate valve iron input current Southern.

On 15 December an envelope, containing gunpowder and a primer, is caught in the seat of Equitalia Flaminio in Rome on the Tiber. On 20 December an envelope containing white powder with no sender is delivered to the site via Equitalia Millevoi. On 22 December, two envelopes containing suspicious powder is delivered to the Stock Exchange in the square in Milan and the Business of Equitalia in Via San Gregorio. On 4 January an anonymous caller warns of a bomb the headquarters of Perugia Equitalia. After the appropriate checks reveals a false alarm.

January 5 at Leghorn a threatening letter and a 7.65 caliber bullet is sent to the Director of the office of Equitalia of Livorno. The same day at Caserta a parcel containing gunpowder and intended to Equitalia of Caserta is intercepted by the Post Office, insospettitesi the lack of sender. Inside is also found a threatening letter. On January 9, an envelope containing suspicious powder and addressed to Equitalia is intercepted in the post office of Ischia and a second envelope with gunpowder and a piece of rope as a wick reaches the site of the Tiber Equitalia Flaminio in Rome.

Moody's cuts ratings on 26 Italian banks
14 May 2012, by Drew FitzGerald (MarketWatch)
http://www.marketwatch.com/story/moodys-cuts-ratings-on-26-italian-banks-2012-05-14

Moody's Investors Service on Monday downgraded 26 Italian banks to reflect the reduced level of support they might receive from the national government should they run into trouble.

Moody's cut 10 banks by one notch and lowered another eight by two notches.

Six banks received three-notch downgrades and two were cut by four notches.

Five of the banks downgraded Monday are part of larger financial groups.

Moody's has warned in recent months it could lower its credit ratings on number of European financial institutions due to ongoing fiscal woes in their home countries.

The changes often reflect the countries' decreased ability to bail out potentially troubled banks more than any change in the individual institutions' credit metrics.

Downgrade increases Italian banks' woes

http://www.youtube.com/watch?v=98bMmzEWJ6A

15 May 2012 by Euronews

Italian banks have suffered another blow with a mass downgrade by rating agency Moody's.

They were already struggling with shrinking demand and soaring bad loans in austerity-hit Italy.

The 26 large and medium-sized Italian banks that have had their ratings cut will find it more difficult to borrow money.

The downgrades came as new figures show Italy's economy slid further into recession in the first three months of this year.

The Italian economy contracted by a larger-than-expected 0.8% quarter-on-quarter in the first three months of 2012.

Moody's action makes the ratings of Italian banks among the lowest of comparable European countries, with Banca Monte dei Paschi di Siena just above "junk" or non-investment grade status.

The move adds to funding difficulties stemming from the eurozone sovereign debt crisis and is expected to make it more costly for already hard-pressed Italian banks to finance their needs, increasing their reliance on European Central Bank funds.

*Sharp reaction*

The European Central Bank should disregard Moody's decision to downgrade 26 Italian banks in its own relations with local lenders, the head of the Italian banking association ABI said.

"We forcefully ask that the ECB and European institutions disregard these judgements, otherwise it will create a short circuit we will never be able to get out of," ABI head Giuseppe Mussari told a conference in southern Italy

The move was criticised as part of a "never-ending attack" on Italy by the head of Italian employers lobby Confindustria.

"These judgements should be made with more care, the situation is delicate and there is a never-ending attack that worries us," Confindustria president Emma Marcegaglia said.

Italian authorities increase security at 14,000 sites, assign body guards

Italy increased security Thursday at 14,000 sites, and assigned bodyguards to protect 550 individuals after a nuclear energy company official was shot and letter bombs directed to the tax collection agency.

Under the enhanced measures, Interior Minister Anna Maria Cancellieri deployed 20,000 law enforcement officers to protect individuals and sensitive sites. In addition, 4,200 military personnel already assigned throughout Italy will be redeployed according to new priorities.

“Based on a thorough analysis of the situation, Interior Cancellieri has confirmed the need to maintain a high level of vigilance, strengthen the security measures against sensitive targets and those exposed to specific risks,” the Interior Ministry said in a statement.

http://thedailyattack.com/2012/05/17/italy-authorities-increase-security-at-14000-sites-assigned-body-guards/

http://finance.yahoo.com/news/spain-region-greek-exit-warnings-114218247.html?l=1

Spain region, Greek exit warnings rattle euro zone

5/26/12

(Reuters) - Central banks and companies risk making a grave error if they do not brace for a possible Greek exit from the euro zone, Belgium's foreign minister said on Friday, rattling markets already alarmed by Spain's deteriorating finances.

Greek elections are scheduled for June 17 and could hasten the country's departure from the currency club should a government intent on ripping up the country's bailout program result.

Contrasting findings of opinion polls on Friday showed the outcome is too tight to call.

Greece accounts for little more than 2 percent of the euro zone economy but could pose a profound contagion threat if it quit the currency area, throwing the spotlight on Portugal, Spain and even Italy.

more

Italian yields rise in 5- and 10-year auctions
30 May 2012, by Sara Sjolin - London (MarketWatch)
http://www.marketwatch.com/story/italian-yields-rise-in-5-and-10-year-auctions-2012-05-30

The Italian government on Wednesday sold a total of €5.732 billion of medium and long term Treasury bonds, at higher borrowing costs than at previous auctions with same maturities, Dow Jones Newswires reported.

The Italian Treasury sold €3.391 billion in 5-year bonds, just below its target range, at a yield of 5.66%.

The government also sold €2.341 billion in 10-year bonds at a yield of 6.03%, higher than the 5.84% produced at the previous auction with same maturity.

For the 10-year bond, the government had aimed at selling between €2 billion and €2.75 billion, according to DJ. In the secondary market,

yields on 10-year Italian government bonds surged 21.6 basis points to 6.111%, according to electronic trading platform Tradeweb.
 
 

Italy earthquakes will hit economy hard: business lobby

5/30/12

ROME (Reuters) - The strong earthquakes that hit the northern Italian region of Emilia Romagna in the past days will have prolonged economic effects that will worsen an already difficult situation, Italy's main business association said on Wednesday.
 
"The earthquakes in May, which had very serious effects on people's lives, will also have prolonged consequences for some of the most important industrial regions in Italy and for an area with strong manufacturing activity," business lobby Confindustria said in an economic report.
 
"This can only worsen an already very difficult situation," it said.
 
Emilia Romagna, one of Italy' richest and most productive regions, was hit by a deadly magnitude 5.8 earthquake and a series of aftershocks on Tuesday, just over a week after a force 6.0 tremor in the same region.
 
More than 20 people were killed in the two earthquakes which caused a swathe of destruction across the region.
 
(Reporting by James Mackenzie)

http://news.yahoo.com/italy-earthquakes-hit-economy-hard-business-lobby-091445830--business.html;_ylt=AoGZqERR3rZSQmF3uxtxWmSw73QA;_ylu=X3oDMTRvbWI0dDNmBGNjb2RlA2dtcHRvcDEwMDBwb29sd2lraXVwcmVzdARtaXQDTmV3cyBmb3IgeW91BHBrZwNiNWRhOWY3Ni0yNGY1LTNjNjMtYTQ3Zi0xZmI3Y2M4MTY1ZmUEcG9zAzgEc2VjA25ld3NfZm9yX3lvdQR2ZXIDMThjOGY4NjAtYWEzOC0xMWUxLThmN2YtMjIzMzJjYjNkZThm;_ylg=X3oDMTN1aGdwczk3BGludGwDdXMEbGFuZwNlbi11cwRwc3RhaWQDNzI2OGNlMjgtODI2Yi0zNjBlLTgzMzctYjUxNDdkNjJkMDYyBHBzdGNhdANidXNpbmVzc3xidXNpbmVzcyUyRlRvZGF5JTI1MjdzJTI1MjBNYXJrZXRzBHB0A3N0b3J5cGFnZQ--;_ylv=3

Italy, Spain default insurance costs hit record
1 June 2012. by William L. Watts - Frankfurt (MarketWatch)
http://www.marketwatch.com/story/italy-spain-default-insurance-costs-hit-record-2012-06-01

The cost of insuring Spanish and Italian government debt against default via instruments known as credit default swaps, or CDS, hit new records on Friday, according to data provider Markit.

The spread on five-year Spanish CDS widened to 610 basis points from 596 basis points on Thursday.

That means it would now cost $610,000 annually to insure $10 million of Spanish debt against default for five years, up $14,000 from the previous day.

The spread on Italian CDS widened by 22 basis points to 579.

Core euro-zone countries also saw a rise, with the French CDS spread widening by 8 basis points to 225 and Germany widening by 4 basis points to 106, Markit said.

Italian Jobless Rate Rose to 10.2% in April Amid Slump
1 June 2012, by Lorenzo Totaro (Bloomberg)
http://www.bloomberg.com/news/2012-06-01/italian-jobless-rate-rose-to-10-2-in-april-amid-slump.html

Excerpt:

Italy’s joblessness rose more than economists forecast in April to the highest in 12 years amid a deepening slump in Europe’s fourth-biggest economy.

The unemployment rate increased to a seasonally-adjusted 10.2%, the highest since the first quarter of 2000, from a revised 10.1% in March, Rome-based national statistics office Istat said in a preliminary report today.

Economists forecast an increase to 9.9%, the median of 10 estimates in a Bloomberg News survey showed.

The jobless rate rose to 9.8% in the first quarter from 9.1% in the previous three months, Istat said.

The economy, in its fourth recession since 2001, will contract 1.5% this year before expanding 0.5% in 2013, Istat forecast in its annual report May 22.

Industrial output probably declined 0.6% last month as two earthquakes in the north weigh on Italy’s outlook with “lasting” consequences on production, Rome-based employers lobby Confindustria said in a May 30 note.

more

ECB Must Print Euros or Italy May Say ‘Ciao:’ Berlusconi
1 June 2012, by Lorenzo Totaro and Jeffrey Donovan (Bloomberg)
http://www.bloomberg.com/news/2012-06-01/berlusconi-says-ecb-must-print-euros-or-italy-may-say-ciao-1-.html

Excerpt:

Former Premier Silvio Berlusconi said Italy should say “ciao, euro” if the European Central Bank doesn’t start printing money to tackle the debt crisis and Germany should quit the single currency if it won’t back a bolder role for ECB.

“The economic crisis can’t be solved” in Italy, Berlusconi said in comments posted on his party’s website today. He called on Prime Minister Mario Monti to “change his political line” and lobby European leaders to back a money- printing campaign by the Frankfurt-based ECB.

If the central bank doesn’t become a “lender of last resort,” Italy should say “ciao, euro,” the former premier said.

The media tycoon-turned-politician became the latest European leaders to step up pressure on German Chancellor Angela Merkel and the ECB to permit a more aggressive response to the region’s debt crisis.

Monti yesterday called on Merkel to drop her opposition to allowing the euro region’s rescue mechanism to lend directly to banks.

more

http://news.yahoo.com/berlusconi-says-idea-italy-dump-euro-joke-143540480--business.html;_ylt=Ak7tyfxxlIqaUP5N1cD8u7Ww73QA;_ylu=X3oDMTRvaWFia2ExBGNjb2RlA2dtcHRvcDEwMDBwb29sd2lraXVwcmVzdARtaXQDTmV3cyBmb3IgeW91BHBrZwNhNjY1ZGFlNS1jZTY3LTM0YTUtOTI3Zi1lN2Q4Yjg5MTE2NjkEcG9zAzIEc2VjA25ld3NfZm9yX3lvdQR2ZXIDYjVmNWFhZTAtYWNjMC0xMWUxLWFmZmYtMjViZTA2ZTEwOGI3;_ylg=X3oDMTJyaG5rN3ZlBGludGwDdXMEbGFuZwNlbi11cwRwc3RhaWQDN2RlMjFmZjgtZGNmMy0zNzhhLWIxNjItYjU0NTQzMzZlMDgyBHBzdGNhdANidXNpbmVzcwRwdANzdG9yeXBhZ2U-;_ylv=3

Berlusconi says idea Italy should dump euro was "joke"
By Steve Scherer | Reuters – 9 hrs ago.

ROME (Reuters) - Former Premier Silvio Berlusconi said on Saturday he was only joking when he suggested that Italy should dump the euro unless the European Central Bank agreed to inject more cash into the economy.
 
"We have to go to Europe and say forcefully that the ECB should start printing money. If it doesn't, we should have the strength to say 'ciao, ciao' and leave the euro," Berlusconi said on Friday in an entry on his Facebook page.
 
Less than 24 hours later, the former leader reversed his position, which clashed with that of Prime Minister Mario Monti and threatened to undermine the government almost a year ahead of the next national vote.
 
"That a joke ... could be mistaken for a proposal is certainly a serious mistake for whoever claims to provide political news," Berlusconi wrote on Saturday on his Facebook page.
 
He said the press had taken seriously what he had said "with a smile and irony".
 
Berlusconi's People of Liberty (PDL) party is one of the two main blocs supporting Monti's government of technocrats, which was brought to power in November precisely to prevent Italy from defaulting on its debt and destroying the single currency.
 
The Italian media underscored on Saturday that it would be impossible for the PDL to continue supporting Monti if it openly campaigned against the euro.
 
The 75-year-old Berlusconi, having given up leadership of the party amid an ongoing trial on charges of paying for sex with an underage prostitute, appears to be hankering for a comeback as next year's elections approach.
 
The PDL, blamed for failing to reform the economy, took a drubbing in local elections last month, when Italians embraced the Five-Star Movement, an anti-euro protest bloc led by comedian Beppe Grillo.
 
Berlusconi has a long track record of saying provocative things and backtracking later.
 
Less than a month after the collapse of Lehman Brothers Holdings in September 2008, then-Prime Minister Berlusconi said world leaders were considering closing international markets to "rewrite the rules of international finance".
 
With an hour, he denied the comments, which had sent the Dow Jones Industrial Average tumbling more than 8 percent, saying no leader was thinking of shutting the markets and that it was a rumour he had "heard on the radio".

http://news.yahoo.com/could-italy-next-fears-spain-bank-rescue-134350996.html

Could Italy be next? Fears after Spain bank rescue

6/10/12

Even as the global economic community hailed an agreement to rescue Spain's stricken banks, there was concern in Rome on Sunday that investors could now begin treating Italy as the next weak link in the eurozone.
 
Those fears have been fueled by a report from Moody's ratings agency warning that Spain's banking troubles could be "a major source of contagion" for Italy where lenders are also highly reliant on European Central Bank funding.
 
"Italy is now the only country in difficulty that has not had to ask for a bailout," said Federico Fubini, a columnist for the top-selling Corriere della Sera daily, after aid packages for Greece, Ireland, Portugal and now Spain.
 
Without a stabilisation in borrowing costs on the debt markets for Italy and Spain and a Europe-wide agreement on the banking system, Fubini said that "the uncertainty will be very high and scrutiny of Italy will grow ever higher."
 
Italy's borrowing costs are lower than Spain's -- indicating greater investor confidence -- but they have been moving in line with Spanish ones.

more

Bank Holiday in Italy(BNI)

via Drudge:
http://translate.google.com/translate?hl=en&sl=auto&tl=en&u=http%3A%2F%2Fwww.adiconsum.it%2FPages%2FNews.aspx%3Fn%3D1675%26AspxAutoDetectCookieSupport%3D1


BNI depositors unable to make withdrawals / payments, payments of utility bills, mortgage payments, taxes
Peter Giordano, Adiconsum: "Grave of the Bank of Italy's attitude that takes action without considering the impact on depositors, and especially on single-income families and pensioners"

Adiconsum Bank of Italy asks for an urgent meeting and the lifting of the

The Bank of Italy authorized the suspension of payments by Bank Network Investments SpA (BNI) without communicating anything to the depositors.

Very serious and unacceptable - says Peter Jordan, Secretary General Adiconsum - the attitude of the Bank of Italy SpA in each BNI, because highly prejudicial to the interests of customers.

Bank of Italy, in fact, after extending the receivership of the bank, thus giving the impression of an imminent rescue, then gave the green light for compulsory winding up, without giving any prior notice to the depositors, leaving them in no condition to perform any type of operation, even basic ones for daily survival, such as withdrawals / payments, utilities payments, rates, taxes.

We must unfortunately note that offensive measures as those adopted to customers BNI - Giordano complaint - not an isolated case. Decisions without taking into account the heavy impact, particularly on savers in possession of a single bank account on which accrediting salary or pension, are not new to Bank of Italy, and also affected depositors of Banca MB.

The attitude of the Bank of Italy - Jordan continues - is bureaucratic and deed and as Adiconsum we asked in a letter sent to the Bank of Italy and the lifting of the BNI and an urgent meeting to define the way in which customers, especially Fixed-income families and pensioners, can perform normal daily operations.

http://www.telegraph.co.uk/finance/financialcrisis/9323070/Italy-in-focus-amid-fears-of-contagion.html

Italy in focus amid fears of contagion

 Italy must make more progress with its financial reforms to avoid being targeted by traders looking for the “next in line” for an international rescue after Spain’s request for help.


Economists and analysts warned that Italy could face a turbulent few days amid concerns about contagion from Spain.

Daniel Gros, head of the Centre for European Policy Studies in Brussels, said: “After Spain, there will not be the margins to help Italy. It will be defenceless and forced to help itself if the situation deteriorates.”
 
The Italian business newspaper Il Sole 24 Ore said the €100bn (£80bn) deal to prop up Spain’s banks “represents the removal of the filter that separates our country from the group of other countries in difficulty”. Another paper, Corriere della Sera, said: “Italy is now the only country in difficulty that has not had to ask for a bail-out.”
 
Compared to Spain, Italy’s banks are stronger and its borrowing lower. But last week Moody’s said Spain’s banking troubles could be “a major source of contagion” for Italy. The rating agency downgraded 26 Italian banks last month, including UniCredit and Intesa Sanpaolo.
 
The Spanish rescue was designed to calm markets ahead of the crucial elections in Greece next Sunday. However, this weekend the anti-austerity leftist party, Syriza, was main­taining its lead in the polls. Evangelos Venizelos, head of the mainstream Pasok party, today said that he had written to the other political leaders warning them of a “bogus impasse” that threatens to return another hung parliament.
 
more

http://www.bloomberg.com/news/2012-06-10/italy-moves-into-debt-crisis-crosshairs-after-spain-bank-rescue.html

6/10/12

Italy Moves Into Debt-Crisis Crosshairs After Spain

The 100 billion-euro ($125 billion) rescue for Spain’s banks moves Italy to the frontline of Europe’s debt crisis, putting pressure on Mario Monti’s unelected government to avoid succumbing to a market rout.

“The scrutiny of Italy is high and certainly will not dissipate after the deal with Spain,” Nicola Marinelli, who oversees $153 million at Glendevon King Asset Management in London, said in an interview. “This bailout does not mean that Italy will be under attack, but it means that investors will pay attention to every bit of information before deciding to buy or to sell Italian bonds.”

Italy has more than 2 trillion euros of debt, more as a share of its economy than any advanced economy after Greece and Japan. The Treasury has to sell more than 35 billion of bonds and bills per month -- more than the annual GDP of each of the three smallest euro members, Cyprus, Estonia and Malta.

Spanish Economy Minister Luis de Guindos said on June 9 that he would request as much as 100 billion euros in emergency loans from the euro area to shore up a banking system hobbled by more than 180 billion euros of bad assets. Mounting concern about the state of Spain’s banks and public finances drove the country’s borrowing costs to near euro-era records last month, dragging up Italian rates in the process.

“The problem for Italy is that where Spain goes, there’s always the perception that Italy could follow,” Nicholas Spiro, managing director at Spiro Sovereign Strategy in London said in an interview. ’’There is insufficient differentiation within the financial markets. It is clear as the light of day and has been that Spain’s fundamentals are a lot direr than Italy’s. That hasn’t stopped Italy suffering from Spanish contagion.’’

more

Italian BNI Bank Declares Bank Holiday Until July 1st, People in Panic:
http://sgtreport.com/2012/06/italian-bni-bank-declares-bank-holiday-until-july-1st-people-in-panic/
http://the2012scenario.com/2012/06/more-on-closure-of-bni-italy/

Yields for Spanish, Italian bonds spike higher
12 June 2012, by Barbara Kollmeyer - Madrid (MarketWatch)
http://www.marketwatch.com/story/yields-for-spanish-italian-bonds-spike-higher-2012-06-12

The yield on Spain's 10-year bond yield spiked above 6.7% on Tuesday, taking out highs reached last November.

The yield shot up 28 basis points in late afternoon trading, to 6.81%, according to Tradeweb.

That is the highest level on record according to Tradeweb charts, which go back to 2008.

The yield on Italy's 10-year government bond jumped 23 basis points to 6.27%.

As bond yields spiked, European stocks turned lower across the board.

Yields for Spain have been under fresh pressure this week due to disappointment over the bailout plan for the nation's banks.

Italian yields have been moving in lockstep, with concerns as well that that government may need a bailout at some point.

Italy borrowing costs rise on Spain concern
13 June 2012, (MarketWatch)
http://www.marketwatch.com/story/italy-borrowing-costs-rise-on-spain-concern-2012-06-13

-- Spanish and Italian yields stay close to highs on fears Spain will need a bailout

-- German bunds under pressure on contagion fears, but auction reassures

-- Italian borrowing costs climb at bill sale

http://ca.news.yahoo.com/austrian-minister-says-italy-too-may-bailout-103617019--sector.html

Austrian minister says Italy too may need bailout

6/12/12

VIENNA/ROME (Reuters) - Raising the stakes in Europe's debt crisis, Austria's finance minister said Italy may need a financial rescue because of its high borrowing costs, drawing a sharp denial on Tuesday from the Italian prime minister.
 
Maria Fekter's assessment of the euro zone's third largest economy stoked investors' fears that Europe is far from ending 2-1/2 years of turmoil - a feeling reinforced by Dutch Finance Minister Jan Kees de Jager, who said the euro zone was "still far from stable".
 
A deal by euro zone finance ministers on Saturday to lend Spain up to 100 billion euros ($125 billion) to recapitalize its banks was seen by many in the markets as yet another sticking plaster. Spanish 10-year bond government yields soared to 6.81 percent, their highest level since the euro's launch in 1999.
 
Euro zone rescue funds, already stretched by supporting Greece, Portugal, Ireland and soon Spain, might be insufficient to cope with Italy as well, Fekter said in a television interview on Monday night.

more

Italy Pays More For 6 Month Debt Than America Pays For 30 Year, As LTRO Claims Its First Bank Insolvency
27 June 2012, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/italy-pays-more-6-month-debt-america-pays-30-year-ltro-claims-its-first-bank-insolvency

Today Italy had a rather critical Bill auction in which it sold €9 billion in debt due six months from today.

Obviously, since the maturity is well inside of the LTRO, the auction itself was rather meaningless from a risk standpoint.

Still, the good news is that Italy managed to place the entire maximum amount targeted.

The bad news: it cost Italy more to raise 6 months of debt, or 2.957%, than it costs the US to borrow for 30 years (2.70%).

more

Moody’s Downgrades Italy’s To Baa2 From A3, Negative Outlook – Full Text
12 July 2012, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/moodys-downgrades-italys-baa2-a3-negative-outlook-full-text

Sicily close to the default: salaries and pensions are at risk
16 July 2012, (Wall Street Italia)
(google trans fom Italian) http://tinyurl.com/7g9x4tw

Org: http://www.wallstreetitalia.com/article/1410721/sicilia-vicina-al-default-a-rischio-stipendi-e-pensioni.aspx

The Region and the 'brink of failure. Sounding the Alarm 'Ivan Lo Bello, Vice President of Confindustria: "It should be rethought and the autonomy necessary to initiate a truth.'"

And 'Greece of Italy: €5 billion hole.

Rome - Sicily is "bankrupt, close to default."

The warning from the pages of the Corriere della Sera and 'Vice President of Confindustria, Ivan Lo Bello, according to which "must be rethought and also the autonomy necessary to initiate a' process-truth '.

Likely to be the Greece of Italy: in the Court of Auditors and the hole €5 billion.

But the debt consolidated, and 'much more' high, warns Lo Bello. "We must take note of the situation and figure out if and 'can move forward."

Van "completely changed the prevailing model of support and to avoid parasitic elements," Lo Bello said in a posting to RaiNews24.

The intent 'to shake the torpor of the Sicilians, from regional to retired employees of the same region that will be the first to be without salary in case of collapse.

Egan Jones Triple Hooks Italy: Boots The Boot To CCC+ From B+, Watch Negative
25 July 2012, by Tyler Durden (Zero Hedge)
http://www.zerohedge.com/news/egan-jones-triple-hooks-italy-downgrades-boot-b-ccc-watch-negative

And another country falls to the Egan Who juggernaut.

Synopsis: Italy and its regional governments need to rollover approximately EUR183B in 2012 and EUR214B next year and is likely to experience increasing yields and restricted access without external intervention. Yields on the 10 year bonds are near 6.5%; rates have been rising despite prior ECB purchases. Future intervention by the ECB and IMF will provide some liquidity but might subordinate existing creditors. Italy cannot support all of its debt if the EU economy falters. Debt/GDP will continue to rise and the country will remain pressed. We are downgrading from " B+ " to " CCC+ " , with a neg. watch

Look for the "reputable" raters such to follow suit in downgrading Italy in 2-3 months.

http://news.yahoo.com/markets-hold-breath-bold-ecb-action-041413677.html

8/2/12

Spain, Italy reject bailout; Draghi says euro 'irreversible'

Spain and Italy rejected Thursday the need for a bailout after markets fell sharply on disappointment that the European Central Bank did not announce new immediate steps to tame the eurozone debt crisis.
 
ECB head Mario Draghi insisted earlier that the embattled single currency was "irreversible," damning speculative financial market bets against the euro for pushing up government borrowing costs to unsustainable levels.
 
But in the absence of concrete measures, the markets returned to the attack, with Spanish borrowing costs spiking back to danger levels above 7.0 percent and Madrid stocks slumping more than 5.0 percent as Italy was also hit badly.
 
United in adversity, Spanish Prime Minister Mariano Rajoy told a joint news conference in Madrid with his Italian counterpart Mario Monti that their "two countries want to work together" to get through the debilitating crisis.

more

S&P downgrades Italian banks on deeper recession
3 August 2012, by Nathalie Tadena (MarketWatch)
http://www.marketwatch.com/story/sp-downgrades-italian-banks-on-deeper-recession-2012-08-03

Standard & Poor's Ratings Services raised its economic-risk score on Italy and downgraded 15 Italian banks, noting the country faces a deeper and more prolonged recession than the firm had originally anticipated.

S&P also lowered its outlook on one bank and removed ratings on four of them from negative Credit Watch.

A severe recession likely will increase Italian banks' problem assets in 2012 and 2013 to levels higher than anticipated, and higher than other banks in Europe, the ratings firm said.

At the same time, the banks' coverage of problem assets has weakened in the past few years, S&P said.

more

Italy's Latest Record Debt Load: Bigger, Faster, More
13 August 2012, by Tyler Durden  (MarketWatch)
http://www.zerohedge.com/news/italys-latest-record-debt-load-bigger-faster-more

Italy just announced its all-time record high general government debt load at €1.973 trillion.

What is perhaps most stunning, given all the talk of austerity, cutting back, reforms, and change is that the size of this debt is growing at an ever-increasing pace that is simply stunning.

Pre-Euro (1999), Italy's debt was growing at a rate of just less than €2 billion per month; in the eight years from then until the crisis in 2008,

Italy's pace of debt growth (fostered we are sure by the convergent cheapness of funding and their immutable belief in invincibility) almost perfectly doubled to €3.8bn per month.

Since 2008, and the onset of excess Keynesian ridicule we assume, Italy's debt load has grown at a stunning pace of €6.4 billion per month and perhaps most incredible; however,

the last nine-months (since the peak 'peak' of the crisis in September of last year) has seen the pace of debt-load growth surge to €9.5 billion per month.

Sustainable levels of exponential debt growth - sure!

http://www.france24.com/en/20121018-moodys-downgrades-worlds-oldest-bank-junk

18 October 2012 - 08H57   
Moody's downgrades world's oldest bank to 'junk'

AFP - Moody's credit rating agency on Thursday downgraded the world's oldest bank, Italy's Banca Monte dei Paschi di Siena, to "junk" status on worries government recapitalisation plans will prove insufficient.
 
The lowering of BMPS's rating by two notches to "Baaa3", a non-investment grade, reflects Moody's view that "there remains a material probability that the bank will need to seek further external support," the agency said.
 
Critically exposed to the eurozone debt crisis, in June BMPS was forced to accept a government bailout, borrowing roughly 1.5 billion euros ($1.87 billion) in order to pay off debt and shore up its capital.

The bank has also said it would reduce its workforce by 4,600 people by 2015.

450,000 Businesses Shut Down in Italy; Non-Performing Loans Jump 15.3%, Write-Downs 21.6%
25 November 2012, by Mike Shedlock (MISH'S Global Economic Trend Analysis)
http://globaleconomicanalysis.blogspot.nl/2012/11/450000-businesses-shut-down-in-italy.html

This is such a joke. The robbery by bankers is in full progress!

Of course the debt continues to grow exponentially. That's what a debt-based economy does. You never pay it off because that's not how it works. It's designed to keep people in debt, ever paying interest on money that isn't even the banks money to lend. This is exactly how bankers got to where they are today. It is the ultimate "love of money".

Italian debt hits record high of $3.2 trillion
14 December 2012, Milan (AP)
http://www.todayonline.com/World/EDC121214-0000144/Italian-debt-hits-record-high-of-S$3,2-trillion

Italian public debt has swelled to its highest level ever, reaching €2.014 trillion ($3.2 trillion) in October.

The Bank of Italy on Friday said that the debt pile has risen by 3.7% since January 2012, when it was €1.94 trillion.

The Italian economy, the third-largest among the 17 European Union countries that use the euro, is in recession as the government has enacted spending cuts and tax hikes to get a handle on its debts.

Italy has the second-highest debt level as a percentage of its GDP in the eurozone, behind only Greece.

Italy's borrowing costs have been kept down in recent months, thanks mainly to a European aid program it has the option to tap, despite political uncertainty raised by Silvio Berlusconi's possible return to politics.

http://news.yahoo.com/popes-resignation-could-hurt-berlusconi-italian-vote-144607951.html

Pope's resignation could hurt Berlusconi in Italian vote
2/12/13

ROME (Reuters) - Pope Benedict's resignation could limit the chances of former Italian prime minister Silvio Berlusconi closing the gap on the center-left frontrunner before this month's election, some pollsters and analysts say.
 
Berlusconi, who seemed certain to lose a few months ago, has staged an aggressive campaign based on tax-cut promises that has eroded the lead of Pier Luigi Bersani's Democratic Party (PD) and raised the prospect of an inconclusive outcome.
 
However, some pollsters say the pope's resignation could clip Berlusconi's wings by eclipsing the election campaign on television and newspapers at a time when he has just 12 days left to win over voters.
 
"This will put the campaign on ice for a while and that is bad news for Berlusconi who still needs to make up ground," said Renato Mannheimer, head of the ISPO polling agency.
 
Final polls published on Friday before a two-week blackout ahead of the February 24-25 vote gave Bersani an average lead of 5.7 points, down from above 10 percent before start of the campaign.

more

http://news.yahoo.com/insight-rome-burn-regardless-italian-election-result-185109216.html

Insight: Rome will burn, regardless of Italian election result

2/21/13

ROME (Reuters) - Regardless of who wins next weekend's parliamentary election, Italy's long economic decline is likely to continue because the next government won't be strong enough to pursue the tough reforms needed to make its economy competitive again.
 
Bankers, diplomats and industrialists in Rome and Milan despair at how Italians are shifting allegiances ahead of the February 24-25 vote to favor anti-establishment upstarts and show disgust with the established parties.
 
That makes it more likely that no bloc will have the political strength to tackle Italy's deep-rooted economic crisis, which has made it Europe's most sluggish large economy for the past two decades.
 
Final opinion polls predict that the vote will deliver a working majority in both houses for a centre-left coalition governing in alliance with technocrat former prime minister Mario Monti. Political risk consultancy Eurasia assigns this scenario a 50-60 percent probability.

more

http://news.yahoo.com/italians-head-polls-crucial-vote-euro-zone-000341355--business.html

Italians head to polls in crucial vote for euro zone

2/23/13

(http://l1.yimg.com/bt/api/res/1.2/CCOcFdIPZ5jY1Q5RQNDJ4A--/YXBwaWQ9eW5ld3M7Y2g9MzAwO2NyPTE7Y3c9NDUwO2R4PTA7ZHk9MDtmaT11bGNyb3A7aD0zMDA7cT04NTt3PTQ1MA--/http://media.zenfs.com/en_us/News/Reuters/2013-02-24T000341Z_1_CBRE91N006900_RTROPTP_2_ITALY-VOTE.JPG)

ROME (Reuters) - Italians vote on Sunday in one of the most closely watched elections in years with markets nervous about whether it will produce a strong government to pull Italy out of recession and help resolve the euro zone debt crisis.
 
A huge final rally by anti-establishment-comedian-turned-politician Beppe Grillo on Friday before a campaigning ban kicked in has highlighted public anger at traditional parties and added to uncertainty about the election outcome.
 
Polling booths will open between 02:00 am-04:00 pm EST on Sunday and 01:00 am-09:00 am EST on Monday. Exit polls will come out soon after voting ends and official results are expected by early Tuesday.
 
The election will be followed closely by financial markets with memories still fresh of the potentially catastrophic debt crisis that brought technocrat Prime Minister Mario Monti to power more than a year ago.

more

http://news.yahoo.com/early-results-point-italy-vote-193504380.html

2/25/13

Early results point to Italy vote gridlock

Early results point to gridlock in crucial Italy elections

ROME (AP) -- The prospect of political paralysis hung over Italy on Monday as partial official results in crucial elections showed an upstart protest campaign led by a comedian making stunning inroads, and mainstream forces of center-left and center-right likely splitting control of Parliament's two houses.

The story of the election in the eurozone's third largest economy was shaping up to be the astonishing vote haul of comic-turned-politician Beppe Grillo, whose 5 Star Movement has capitalized on a wave of voter disgust with the ruling political class.

Another surprise has been the return as a political force of billionaire media mogul Silvio Berlusconi, who was forced from the premiership at the end of 2011 by Italy's debt crisis, and whose forces now seemed poised to capture the Italian Senate. His main rival, the center-left Pier Luigi Bersani, was headed toward victory in Parliament's lower house.

The unfolding murky result raised the possibility of new elections in the coming months and bodes badly for the nation's efforts to pass the tough reforms it needs to snuff out its economic crisis. After surging in the wake of exit polls, Milan's main stock index slumped with first projections before closing up slightly.
 
more

This is getting interesting...

http://news.yahoo.com/big-tally-berlusconi-throws-wrench-italys-election-212011992.html

2/25/13

Big tally for Berlusconi throws wrench into Italy's election

Silvio Berlusconi's party appears to have won Italy's upper house, thereby likely preventing one-time presumptive premier Pier Luigi Bersani from forming a governing coalition.

Silvio Berlusconi pulled off a Lazarus-like rise from political oblivion on Monday by securing enough support in Italy’s general election to hobble, or block altogether, the formation of a new government.
 
Early projections were fluid and sometimes contradictory, but the billionaire businessman’s conservative coalition seemed to have won a majority in the senate, the upper house of parliament.
 
Millions of Italians appeared to have been seduced by promises he made during a fiery election campaign, including pledges to repeal and pay back an unpopular property tax and to create millions of new jobs.

His portrayal of his center-left opponents as unreconstructed Communists, and of Germany as an unfairly harsh fiscal task master imposing austerity on Italians, also struck a chord with many voters.
 
But his unexpected victory is likely to plunge Italy into protracted political paralysis, dismaying the rest of Europe and rattling market confidence in the eurozone’s third biggest economy.

more

http://online.wsj.com/article/SB20001424127887323384604578325992879185934.html?ru=yahoo?mod=yahoo_itp

2/25/13

Messy Italian Election Shakes World Markets

ROME—In a national election meant to push Italy further down a path of economic reform, voters delivered political gridlock that could once again rattle Europe's financial stability.

Markets in Europe and the U.S. gyrated even in response to early returns. The Dow Jones Industrial Average swung nearly 300 points, ending with its worst day in almost four months, as the prospects of a stable government appeared to drop.

A majority of voters endorsed parties that had promised to tone down or even reverse the financial sacrifices Italy has promised its European partners, giving surprise lifts to both the center-right coalition of former premier Silvio Berlusconi and a party of protest led by a former comedian.

Late Monday, the left-wing coalition led by the Democratic Party's Pier Luigi Bersani appeared to have gained a razor-thin victory in the lower house of parliament over the center-right coalition headed by Mr. Berlusconi—29.6% to 29.2% with 99.9% of the ballots counted. By leading the vote count in the lower house, the Democratic Party will automatically get the majority of seats and, therefore, will likely receive the mandate to form a government.

The Senate, however, appeared headed for political impasse. The Democratic Party was the leading vote-getter in the upper house as well, by less than one percentage point. But its 31.6% result fails to provide its coalition with a majority to pass legislation. If a new government isn't able to guarantee clear parliamentary support, Italians could return to the polls within months.

more

http://news.yahoo.com/italian-political-deadlock-casts-uncertainty-eurozone-recovery-175129762.html

2/26/13
Italian political deadlock casts new uncertainty on eurozone recovery

Markets tumbled and the value of the euro dropped in response to Italy's election results and their unexpectedly loud rejection of German-imposed austerity policies.

Europe’s murky path to recovery was rattled yet again Tuesday as markets and policymakers tried to digest the unexpected Italian electoral results and the consequences, especially on periphery economies.
 
A political stalemate in Rome all but condemns the country to new elections in less than a year, with all the implications for the economy. But the unexpectedly loud rejection of German-imposed austerity policies fueled market uncertainty over the already wobbly resolve of European governments to stick to fiscal conservative recipes.
 
Markets were stunned by voter rejection of Prime Minister Mario Monti’s austerity and by the triumph of the Five Star Movement, the anti-establishment party led by comedian Beppe Grillo that won the most votes of any single party.

more

http://news.yahoo.com/parties-may-struggle-form-government-050731781.html

2/27/13

Parties may struggle to form government in Italy

Challenge of forming coalition government in Italy: protest vote against austerity measures

ROME (AP) -- A center-left group of parties appears to have the best shot at forming a coalition government in Italy after an inconclusive national election, but the challenge is steep and comes amid public anger over austerity measures.

If Italian parties fail to form a governing coalition, new elections would be required, causing more uncertainty and a leadership vacuum, and that possibility rattled financial markets across Europe on Tuesday. In early Wednesday trading in Milan, the FTSE MIB rebounded 0.5 percent even though the country had to pay higher borrowing costs in a pair of bond auctions. The index has a long way to go to recoup the previous day's 4.9 percent fall though.

Pier Luigi Bersani and his center-left allies appeared on Tuesday to have won a narrow victory in the lower house of parliament, while the Senate looks split with no party in control. Silvio Berlusconi, the former Italian premier whose center-right coalition did better than expected, is a key player since his coalition is now the second-biggest bloc in the upper chamber.

Comic-turned-political leader Beppe Grillo, whose 5 Star Movement capitalized on a wave of voter disgust with the ruling political class, had a surprisingly strong showing. His bloc of seats in Parliament could prove crucial in making any coalition government viable.

The two-day election on Sunday and Monday also was a clear rejection of the previous technocratic government led by Mario Monti. That government enacted wide-ranging reforms to the budget and the economy. Though its borrowing rates have fallen in financial markets, the cost to Italians has been high, with Italy mired in recession and unemployment on the rise.

Berlusconi has already ruled out an alliance with Monti, his predecessor, whom he blamed for driving Italy deeper into recession.

On Tuesday, a few seats in Parliament based on Italians' voting abroad still remained to be decided, but their numbers won't ease the gridlock. European leaders pleaded with politicians in Italy to quickly form a government to continue to enact reforms to lower Italy's critically high debt and spare Europe another spike in its four-year financial crisis.

Bersani said he was not opening talks with any potential partners until he submits his program to Italy's president, who taps a candidate to form a government.

Stinging from a loss of some 4 million votes compared to the last election in 2008, Bersani hasn't yet identified who he could try to form alliances with. But top officials in his Democratic Left (PD) party were quick to rule out any deal with Berlusconi.

"As far as I go, absolutely not," Stefano Fassina, a PD official, said of a possible Bersani-Berlusconi alliance.

Whether Tuesday's negative market reaction extends further into the week may hinge on how quickly a solution is reached in Italy.

Berlusconi insisted that a government can be formed and called on Italians to ignore the "crazy" markets.

"Markets go their own way. They are independent and also a little crazy," Berlusconi said, adding that a government can be cobbled together, if rival politicians are willing to "make some sacrifices."

Grillo said his forces would seek to thwart any Bersani-Berlusconi deal. Raising the specter of early elections, he predicted any such coalition will "last seven, eight months. The economy won't let them escape."

Bersani himself later made subtle overture toward Grillo's forces, conceding that the center-left campaign had not gone deep enough for change. "We finished first, without winning," he conceded.

Italy is hugely important for the future of the euro, and its apparent stability over the past six months has been one of the reasons that concerns over the currency have eased. Of the 17 European Union countries that use the euro, Italy has the second-highest debt burden as a proportion of its gross domestic product, at 127 percent.

Only Greece's is higher. Italy has to spend around €80 billion a year just to service its debt.

The worry across financial markets is that Italy's appetite for reform may wane and its debt situation may deteriorate.

That was evident in a pair of bond auctions Wednesday. Though it raised €6.5 billion it had to pay higher interest rates to get investors to part with their cash. The country sold 10-year bonds at a yield of 4.83 percent, way up from 4.17 percent last month. The yield on five-year bonds rose to 3.59 percent from 2.94 percent.

Though Italy's annual borrowing — its budget deficit — is relatively small compared with other euro countries at 3 percent of its annual gross domestic product, its overall debt stands at a colossal €2 trillion.
.

http://news.yahoo.com/italy-parties-seek-way-election-stalemate-020012577.html

2/27/13 Italy's political crisis deepens, Grillo refuses to support government

ROME (Reuters) - An Italian political crisis that has rattled the euro zone deepened on Wednesday when two party leaders ruled out the most likely options to form a government and avoid a new election.
 
Populist leader Beppe Grillo slammed the door on overtures from center-left boss Pier Luigi Bersani with a stream of insults while Nichi Vendola, Bersani's junior coalition partner, ruled out a government alliance with the center-right.
 
These two options are currently seen as the only way to avoid returning to the polls in short order after the February 24-25 election, in which a huge protest vote against traditional politicians and austerity policies plunged Italy into deadlock.
 
The prospect of prolonged uncertainty in the euro zone's third-largest economy caused sharp falls on world markets immediately following the election result, but they calmed on Wednesday after solid demand for Italian government debt at an auction, with European bonds, shares and the euro all boosted. [ID:nL6N0BR4F8]
 
The center-left took the most seats in the poll but no single group has a big enough majority to rule.
 
Grillo's anti-establishment 5-Star Movement blocked center-left control of parliament after one of the biggest populist victories in recent European history.
 
Bersani put out cautious feelers to Grillo on Tuesday, suggesting there could be agreement on a short list of measures common to both sides.
 
But he said those supporting a center-left government would have to back it in a confidence vote, which would be essential before it could be installed.

more

http://news.yahoo.com/italys-berlusconi-investigated-corruption-case-123731943.html

Italy's Berlusconi investigated in new corruption case

2/28/13

ROME (Reuters) - Former Italian Prime Minister Silvio Berlusconi is under investigation on suspicion of bribing a senator to change sides in parliament, deepening the legal troubles of one of the key players in the country's post-election deadlock.
 
Berlusconi's lawyer Niccolo Ghedini said the accusation "was without foundation".
 
The allegations were detailed in a document from prosecutors posted on Thursday on the website of Italy's parliament, which must approve the court's request to search a Berlusconi security deposit box and access his phone records.
 
The fresh accusations come as parties including Berlusconi's center-right People of Freedom (PDL) struggle to form a government after this week's inconclusive election, which left no one with a majority in parliament.
 
According to the document, former Senator Sergio De Gregorio told prosecutors Berlusconi paid him 3 million euro ($3.92 million) to switch parties in 2006, a move which destabilized the center-left government and contributed to its eventual collapse.
 
"I told Berlusconi what I wanted... that the party should give me, either the party or he personally, should pay me 3 million," De Gregorio is quoted telling investigators, adding that he needed the money to get out of financial difficulties.
 
No comment was immediately available from De Gregorio's lawyer.
 
The new allegations emerged during a separate corruption probe against De Gregorio, who left the Italy of Values party in September 2006 and was re-elected as a senator, this time for Berlusconi's PDL, in 2008.
 
In a separate case, prosecutors in Reggio Emilia have opened an investigation into Berlusconi's campaign pledge to return property taxes paid last year if the center-right won the election.
 
The case was opened after two formal complaints filed by citizens, alleging that the offer constituted vote buying. PDL official Deborah Bergamini said in a statement that the investigation was "an illogical action aimed at intimidating anyone whom magistrates do not like".
 
In a statement, PDL Party Secretary Angelino Alfano said "the aggression by magistrates against Silvio Berlusconi is beginning again".
 
He said the party would organize a demonstration "to defend the sovereignty of the People of Freedom and Italian democracy".
 
In response, the head of the National Magistrates Association said: "We firmly reject the accusations, repeated periodically, that justice is used for political means."
 
Berlusconi often states that the cases against him are cooked up by "leftist judges" to damage him politically.
 
Berlusconi is on trial for tax fraud in a case centering on the purchase of broadcasting rights by his Mediaset group, for making public the taped contents of a confidential phone call, and for paying for sex with an underage girl.
 
He has faced up to 30 prosecutions for fraud and corruption over his career, but has never been definitively convicted.

http://news.yahoo.com/italy-behind-rise-eurozone-jobless-record-125636910--finance.html

3/1/13
Italy behind rise in eurozone jobless to record

LONDON (AP) — Italy's voters gave their verdict on the austerity medicine they've been forced to take when they went to the polls earlier this week. By Friday, one of the reasons behind the protest was highlighted when the country's unemployment hit its highest level in at least two decades.
 
Official figures Friday showed that unemployment in the country in January rose to 11.7 percent from the previous month's 11.3 percent. January's figure was the highest since the current way of measuring unemployment was introduced in 1992.
 
The unexpectedly large monthly spike was one of the key backdrops to the election results earlier this week that reignited concerns over Europe's dormant debt crisis. No party, or coalition of parties, emerged with enough votes to govern alone, triggering uncertainty in the markets about the future course of Italian economic policy.
 
The rise in the Italian rate, which comes as the country is stuck in an 18-month recession and after a wave of economic reforms and tight budgetary controls introduced to control the country's debt, was also the main reason why unemployment across the 17 European Union countries that use the euro rose to a record 11.9 percent during January from the previous month's 11.8 percent.

more

http://www.reuters.com/article/2013/03/01/italy-finances-idUSL6N0BT79620130301?feedType=RSS&feedName=marketsNews&rpc=43

3/1/13
UPDATE 2-Grim jobless, debt figures underscore Italy's crisis

* Jobless rate hits highest since records began
    * Data shows economy has shrunk since 2001
    * 97,000 jobs shed in January compared to previous month
    * Youth unemployment nears 40 pct


    By Gavin Jones and Naomi O'Leary
ROME, March 1 (Reuters) - Italy's unemployment rate has hit
a 21-year high and its economy is now smaller than it was in
2001, data showed on Friday, underscoring the challenges the
country faces as it struggles to form a government after a
deadlocked election.
   
Joblessness jumped to 11.7 percent in January, and
unemployment among 15-24 year-olds rose to 38.7 percent, both
the highest figures on records dating back to 1992, statistics
agency ISTAT said.
   
"Italy is in ruins," said Rahma Aden, 28, who travels into
central Rome from the suburbs to do cash-in-hand odd jobs and
cleaning work for about 7.50 euros an hour.
   
"People all around me are losing their jobs... If you have
work you hold on to it tight, and keep your mouth closed even if
they treat you badly. Otherwise you'll have your dismissal
letter in your hand in an instant."
   
The country shed 97,000 jobs in January compared with
December, while 310,000 were lost compared with the same month
last year.
   
Italy has been the most sluggish economy in the European
Union for well over a decade. In 2012, real GDP adjusted for
inflation was below the level of 2001, meaning that its economy
has shrunk overall over the last 11 years.

more

http://news.yahoo.com/prospect-italy-vote-heightens-grillo-faces-ultimatum-091130173--business.html

Bersani ultimatum may bring new Italy election closer

3/4/13
ROME (Reuters) - Italy could be inching closer towards another election within months after center-left leader Pier Luigi Bersani issued an ultimatum to anti-establishment 5-Star Movement boss Beppe Grillo to support a new government or return to the polls.
 
Last week's inconclusive election, in which Grillo won a huge protest vote, left no group with a working majority in parliament, making an alliance with a rival the only way out.
 
In an interview on RAI state television late on Sunday, Bersani underlined his opposition to two of the options currently being floated - another technocrat government like the outgoing one led by Mario Monti or a grand coalition with Silvio Berlusconi's center-right.
 
That would leave only one possibility to avoid elections - Grillo's backing for the center-left, which won the lower house in the election but does not have enough support to rule in the Senate.

more

http://www.reuters.com/article/2013/03/04/italy-berlusconi-idUSL6N0BWLK920130304?feedType=RSS&feedName=cyclicalConsumerGoodsSector&rpc=43

3/4/13
UPDATE 1-Berlusconi parties were for prostitution - prosecution

* Prosecution says "bunga bunga" parties involved prostitution

* In statement, Berlusconi says lucky enough to never have to pay

* Berlusconi and "Ruby", then a teenager, deny they had sex

* Media magnate's dental hygienist accused of prostitution (Adds Berlusconi statement)

By Sara Rossi

MILAN, March 4 (Reuters) - Parties at Silvio Berlusconi's Milan villa were arranged for prostitution and were not the elegant dinners he suggested, the prosecution in the Italian former prime minister's sex trial said on Monday.

Making closing arguments in Berlusconi's trial on charges of having sex with an underage prostitute, prosecutor Antonio Sangermano said the parties involved dinner, erotic "bunga bunga" dancing and then sex between aspiring women TV presenters and invited guests.

"I am a bit surprised and a little amused by the prosecution's closing arguments," Berlusconi said in a statement.

"I have had the double good fortune, perhaps deservedly, that I have never had to pay for intimate relations with a girl or a woman and I have always been able to give a positive response to anyone asking me for help. The prosecutor was probably not so fortunate," the media magnate said.

The scandals circling Berlusconi have increased the reluctance of other parties to cooperate with him in parliament after last week's inconclusive election, despite his remarkable performance in taking his centre-right group from close to disintegration last autumn into second place in the vote.

Berlusconi denies charges that he paid for sex with Moroccan nightclub dancer Karima El Mahroug when she was 17 and then abused his power as prime minister to get her released from Milan's police headquarters, where she was held on suspicion of theft in May 2010.

Mahroug, a teenage runaway widely known under her stage name of "Ruby the Heartstealer" also denies having sex with Berlusconi, 76, at the parties in his villa or elsewhere.

Sangermano accused former Lombardy regional councillor Nicole Minetti, once Berlusconi's dental hygienist, of taking part in acts of prostitution and inducing others to do so.

Minetti is on trial separately - with Emilio Fede, a former senior journalist in Berlusconi's media empire, and show business talent scout Lele Mora - on charges of procurement.

Berlusconi faces up to 15 years in jail if convicted although nothing will be final until two appeals allowed by Italian law, usually a lengthy process.

The verdict in the Ruby trial is expected on March 18 and Berlusconi faces judgment in two other trials this month, one for tax fraud and the other for making public the taped contents of a confidential phone call.

His legal troubles deepened last week when prosecutors revealed he was under investigation for bribing a senator to change sides in parliament in 2006.

Berlusconi's lawyer, Niccolo Ghedini, said the prosecution's summing up was "exquisitely one-sided".

http://news.yahoo.com/italian-president-mulls-technocrat-government-sources-113723497.html

3/5/13
Italian president mulls new technocrat government: sources

ROME (Reuters) - President Giorgio Napolitano is considering appointing a new technocrat government led by a non-politician as one way out of Italy's political stalemate, Italian officials said on Tuesday.
 
Such a solution would come into play if center-left leader Pier Luigi Bersani failed to form a government after receiving an initial mandate from Napolitano, as is expected, they said.
 
"Napolitano wants a government with the broadest possible support that will last as long as possible," one of the officials told Reuters.
 
Bersani won a majority in the lower house of parliament and says he has the right to be the first to try to form a government, although he has no workable majority in the Senate.
 
However, 5-Star Movement leader Beppe Grillo, who holds the whip hand after winning a huge protest vote, responded to speculation about a technocrat government in Italian media on Tuesday by saying he would not support such an administration.
 
"Technocrat governments don't exist in nature but only political governments supported by parliamentary majorities. The Monti government was the most political government since the war," he said on his blog.

more

http://ca.news.yahoo.com/italys-bersani-seeks-way-forward-vote-impasse-141334106--business.html

3/6/13
Italy's Bersani seeks way forward after vote impasse

ROME (Reuters) - Italian center-left leader Pier Luigi Bersani, under fire for falling short in last week's election, sought on Wednesday to rally his party behind a plan to form a minority government backed by populist leader Beppe Grillo.
 
Bersani, whose coalition threw away a 10-point lead in the opinion polls before the February 24-25 vote, won control of the lower house but let slip a workable parliamentary majority by failing to win the Senate.
 
The result has left no group able to form a government on its own and Italy facing weeks of uncertainty. A new election could be called within months if no accord can be reached between the divided parties.
 
In an address to officials of his Democratic Party in Rome, Bersani, a 61-year-old former industry minister, acknowledged that the result was a defeat but said the left was the only political force capable of forming a government.

more

http://abcnews.go.com/International/wireStory/berlusconi-convicted-wiretap-case-18673130

Berlusconi Convicted in Wiretap Case
3/7/13
Former Italian Premier Silvio Berlusconi was convicted Thursday over the illegal publication in a newspaper owned by his media empire of wiretapped conversations related to a bank takeover attempt.
 
A Milan court found Berlusconi guilty of breach of confidentiality and sentenced him to one year in jail, though it did not issue an order on carrying out the sentence. In Italy, it is rare for anyone to be put behind bars pending a possible appeal except in the case of very serious crimes like murder.
 
The verdict, the first of three expected for Berlusconi in the coming weeks, comes at a moment of political uncertainty for the country after February national elections failed to elect a clear winner. Berlusconi's center-right coalition finished second.
 
The conviction, however, has no bearing on Berlusconi's eligibility to participate in discussions on forming a new government, which are expected to begin March 20. Lawmakers have failed, despite several attempts, to pass a law banning candidates from Parliament after any criminal conviction.
 
While Berlusconi's party won't be tapped to form a new government, a task that is expected to fall to Pier Luigi Bersani on the center-left, President Giorgio Napolitano will be looking to secure as broad agreement as possible for legislative priorities.
 
Napolitano's role as president is to preside over coalition talks by convening the parliamentary groups for private meetings in which he seeks to gain consensus for a new government — a particularly difficult task given the three-way gridlock resulting from last month's vote.
 
The third player with influence on the discussions is comic-turned-civic leader Beppe Grillo, who has said his movement —which gained 25 percent of the vote — won't formally support any government with a vote of confidence, which must be secured by Italy's constitution. It remains to be seen how this conflict can be resolved.
 
Berlusconi, in a statement, accused the courts of judicial persecution "that continues for 20 years and is revived every time there are particularly complex moments in the political life of the country."
 
He said he expects convictions in his pending Milan trials: an appeal to his October conviction on a tax fraud charge and the sensational sex-for-hire trial that accuses him of having paid for sex with an under-age teen and using his influence to cover it up.
 
Berlusconi's brother, Paolo Berlusconi, was convicted of the same charge and sentenced to two years and three months. Paolo Berlusconi is publisher of the Milan newspaper il Giornale, which published the transcript of the conversation.
 
Silvio Berlusconi's defense team and political allies accused the court of seeking a speedy verdict for political impact.
 
"It is always more clear that there is an attempt to eliminate Silvio Berlusconi by judicial means, having failed by electoral or democratic measures," said Angelino Alfano, the head of Belursconi's People of Freedom party.
 
The charge relates to the 2005 publication of a wiretapped call that was part of an investigation into the Unipol financial services company's bid to take over the Banca Nazionale del Lavoro. The bid was later blocked by Italy's central bank, contributing to the forced resignation of then-Bank of Italy chief Antonio Fazio — and led to a series of trials that saw Fazio and others convicted.
 
Wiretapped conversations are widely published in Italian media, despite the risks of prosecution.
 
In a potentially more damaging case, the verdict is also nearing in Berlusconi's appeals trial on a conviction of tax fraud in the purchase of rights to broadcast Hollywood films on Berlusconi's Mediaset network. Prosecutors have demanded the court uphold the conviction and four-year sentence. They also are seeking a five-year ban from public office.
 
Berlusconi also is on trial in Milan for allegedly paying a Moroccan teen for sex during his now-infamous Bunga Bunga parties, with a verdict likely this month.
 
Prosecutors in Naples are investigating him for corruption for allegedly paying an opposition lawmaker €3 million ($3.9 million) to join his party, a move that significantly weakened the previous center-left government of Romano Prodi.

I was talking with my dad over the weekend(when we and my mom were out of town visiting my brother and his family) over Italy's current election, and Europe countries's elections in general.

First off, it's not like America's elections - in that it's not that simple. Pretty much the party that gets a certain majority of votes will put their leader as PM.(unlike America where the President, Senate, Congress, etc are elected separately) And b/c Italy didn't, and to make matters worse there was another party(lead by a comedian) thrown in, one of the parties didn't get that certain majority vote, and hence everything is deadlocked.

With that being said - yes, I know the game is rigged - but with all that went on...with the Italian public not happy with the current regime b/c their debt-ridden economy is really at a low point now, it gave Silvia Berlisconi(despite all of his various criminal trials going on) alot of momentum going on. And yes, this despite Berlisconi being a disgraced PM not-too-long-ago. It sure looked like Berlisconi's party was going to catch up and win, until Pope Benedict announced his resignation, hence halting Berlisconi's party's current momentum b/c Benedict was taking over Italy's news coverages from there on out. AND to top everything off, another Italy party steps in lead by some comedian that ends up getting some solid support.

As you can see, all of this has gone BY DESIGN - NOTHING's a coincidence here. No matter how rotten the current Italy leadership regime is, the citizens end up slowly but surely blindly have this mindset that some once-disgraced-not-too-long-ago former PM in Berlisconi will put on a cape and save the country, and some entertainer comedian to boot to add to the Hegelian Dialectic. But nonetheless all of this has lead to one BIG mess - and Berlisconi isn't going anywhere despite all of his criminal trials going on(from wiretapping a business company to underage sex with a minor, etc).

Isn't this rather similar to what went on here last year? A non-natural born citizen President residing over the worst economy since the Great Depression, meaning there was NO WAY he would get re-elected, right? Then his opponent just happened to be just as liberal as he is, and a Mormon to boot - but nonetheless perception was thrown out to everyone how Romney would be the "lesser of 2 evils" which would somehow mean Obamacare, Roe v Wade et al would get tossed out. At one point it sure looked like Romney was gaining alot of momentum until Hurricane Sandy happened late in October, which all but "halted" his "momentum".And throw in Ron Paul/Rand Paul that played "good cop" in all of this mess to not only give people a voice, but to do their part in tilting the election in the NWO's way.

http://www.nytimes.com/2013/03/12/business/global/12iht-euitaly12.html?partner=yahoofinance&_r=0
3/11/13
Thousands of Struggling Italian Firms Hang on Edge

GUIDONIA, ITALY — Emanuele Tedeschi wiped sawdust from his hands and gestured around the cavernous woodworking factory that has been in his family for two generations. The big machines, which used to run overtime carving custom furnishings for private homes, Roman palazzi and even the Vatican, sat idle on a shop floor nearly devoid of workers. “A year and a half ago, the noise from production was so loud that you had to shout to be heard,” said Mr. Tedeschi, walking amid pallets of cherry and other fine woods stacked up and waiting for a purpose.  Since a government austerity plan designed to shield Italy from Europe’s debt crisis took hold last year, the economy has tumbled into one of worst recessions of any euro zone country, and Mr. Tedeschi’s orders have all but dried up. His company, Temeca, is still in business. For now. But among Italy’s estimated six million companies, businesses of all sizes have been going belly up at the rate of 1,000 a day over the last year, especially among the small and midsize companies that represent the backbone of Italy’s €1.5 trillion, or $2 trillion, economy.

http://ca.news.yahoo.com/two-thirds-italians-oppose-returning-ballot-box-poll-153518688.html
3/13/13
Two-thirds of Italians oppose returning to ballot box: poll

ROME (Reuters) - Two-thirds of Italians oppose returning to the ballot boxes after last month's national election left the country in limbo with no political force holding enough seats to form a government, according to a poll published on Wednesday. The center-left coalition led by Pier Luigi Bersani won control of the lower house, but not the Senate in the February 24-25 vote. Both are needed to govern. Bersani has since made repeated overtures to the anti-establishment 5-Star Movement for support in the Senate, all of which have been rejected by the bloc's leader, comic Beppe Grillo, raising the specter of a snap vote.
 
Half of Italians said the best solution for the current gridlock would be a government led by Bersani and backed by the 5-Star Movement, an IPR Marketing poll said. A third of respondents said another technocrat government like the one that caretaker Prime Minister Mario Monti has led since November 2011 would be the best way to avoid an immediate election, the poll showed. A technocrat government would require right-left support in parliament, and would presumably exclude the 5-Star Movement.

more

Well, looks like it didn't take them long to get this dog and pony show over - we'll see the fruits of their Hegelian Dialectic they played out.

http://news.yahoo.com/italy-forms-government-2-month-stalemate-153710380.html
Italy forms new government after 2-month stalemate
4/27/13

ROME (AP) — Center-left leader Enrico Letta forged a new Italian government Saturday in a coalition with former Premier Silvio Berlusconi's conservatives, an unusual alliance of bitter rivals that broke a two-month political stalemate from inconclusive elections in the recession-mired country.

The daunting achievement was pulled off by Letta, who will be sworn in as premier along with the new Cabinet on Sunday at the presidential Quirinal Palace.

Letta, 46, is a moderate with a reputation as a political bridge-builder. He is also the nephew Berlusconi's longtime adviser, Gianni Letta, a relationship seen as smoothing over often nasty interaction between the two main coalition partners.

Serving as deputy premier and interior minister will be Berlusconi's top political aide, Angelino Alfano. He is a former justice minister who was the architect of legislation that critics say was tailor-made to help media mogul Berlusconi in his many judicial woes.

The creation of the coalition capped the latest political comeback for Berlusconi, a former three-time premier who was forced to resign in 2011 as Italy slid deeper in to the eurozone's sovereign debt crisis.

On Monday, Letta is expected to lay out his strategy to Parliament, ahead of required confidence votes from the Chamber of Deputies and the Senate.

"We negotiated for the formation of the government without throwing up any stop signs," Berlusconi to told one of his TV networks. "That's how we contributed to forming a government in short time" after Letta was tapped Wednesday.

Berlusconi, a fervent anti-Communist, views Italy's left as a personal nemesis, and Letta's Democratic Party has some of its roots in what was the West's largest Communist Party.

Letta expressed "sober satisfaction over the team we put together and its willingness" to form a coalition.

Only a few weeks earlier, the head of the Democrats, Pier Luigi Bersani, resigned from the party post in humiliation and he refused Berlusconi's offer for a "grand coalition" and futilely tried to form a government without the center-right. Letta was a Bersani loyalist.

Bersani hailed the coalition formula as a "necessary compromise" that gives the country "freshness and solidarity."

The No. 3 bloc in Parliament, the anti-establishment 5 Star Movement, is led by comic Beppe Grillo, who ruled out any alliance with the largely sullied political class that has ruled Italy for decades.

President Giorgio Napolitano, who tasked Letta with creating a government out of bitter rivals, called upon the coalition partners to work "in a spirit of absolute, indispensable cohesion" as they work for sorely needed political and economic reforms.

The 87-year-old head of state sounded almost breathless as he expressed confidence the rivals could work together "without conflict or prejudices to find the right solutions" to the country's pressing economic and political problems.

Napolitano didn't name the challenges, but they include fighting unemployment, especially for young people, and corruption sullying much of the political class.

Napolitano said: "It was and is the only possible government," and one "whose formation couldn't be delayed further, in the interest of our country and of Europe."

He reluctantly agreed to be re-elected by Parliament earlier this month for another seven-year term because of the political instability.

Italy's economy is No. 3 among eurozone members, and financial markets have been anxiously watching to see if an effective government could be formed to carry on with outgoing Premier Mario Monti's efforts to keep the country from sliding into the eurozone's sovereign debt crisis.

Some Italian political observers have predicted such a hybrid government might last only a few months of Parliament's five-year term, before collapsing in squabbling.

But the fear of elections, especially after the lightning-quick rise of comic Grillo's grassroots movement, could prove to be strong glue.

Giovanni Orsina, deputy director of LUISS university's school of government in Rome, ventured that Letta's new coalition could "last more than we expect, 18 to 24 months, more or less."

The history professor cited "lack of alternatives, and because I believe Parliament's members are not particularly eager to get back to the polling booth and face new elections."

Voters, fed up with new and higher taxes, including a despised property tax revived by Monti, rejected his severe austerity policies.

The small centrist party created in time for the election by Monti, an economist and former European Union commissioner, will participate in the coalition, although Monti won't be in the Cabinet, which is heavy on two novelties — a large presence of female ministers and Italy's first black minister.

A native of Congo, Cecile Kyenge is a doctor who will serve as minister of integration. Proposals to make it easier for Italy' growing immigrant population to become citizens have gone nowhere in Parliament amid fierce opposition from the anti-immigrant Northern League party. The party, a Berlusconi ally, isn't in the new government.

Prominent among the women in the Cabinet is Emma Bonino, a former EU commissioner and Radical Party leader who will serve as foreign minister. Olympic gold medal kayaker Josefa Idem was tapped as minister of equal opportunity and sports.

Letta comes from a moderate wing of the left-rooted Democratic Party that is close to the Vatican. Since Parliament always includes an array of lawmakers enjoying good ties to the politically influential Catholic church in Italy, this was one more qualification on Letta's bridge-building resume.

The father of three sons, he lives in Rome's working-class Testaccio neighborhood. When he was tapped by Napolitano on Wednesday, he drove his own car to the Quirinal Palace, in what was seen as a photo opportunity gesture to Italian taxpayers who widely despise the huge fleet of luxury cars that shuttles around ministers and lawmakers.

In 1998, when he was 32, Letta became the youngest minister in Italy's history when he served as minister for European policy for then-Premier Massimo D'Alema, an ex-Communist leader. Letta seemed a natural for that post. He spent his childhood in Strasbourg, home to the European Parliament, and studied international law before jumping into politics.

Very interesting...obviously, this whole charade was pre-scripted a long time ago. This whole "gridlock" became another Problem-Reaction-Solution Hegelian Dialectic pre-planned - and could lead to the final nail in the coffin of the EU.

Well, this is yet another example of the citizens running up to support the "flavor du jour" candidate, hoping he will somehow save the country. The game is rigged, but nonetheless it seems like people from across the world will fall for the "flavor du jour" every time. You saw it with the "truth" movement doing so with Ron/Rand Paul recently as well.

When Jesus was talking about Caesar, he didn't exactly say there was a "good" and a "bad" Caesar...

Matthew 22:18  But Jesus perceived their wickedness, and said, Why tempt ye me, ye hypocrites?
Mat 22:19  Shew me the tribute money. And they brought unto him a penny.
Mat 22:20  And he saith unto them, Whose is this image and superscription?
Mat 22:21  They say unto him, Caesar's. Then saith he unto them, Render therefore unto Caesar the things which are Caesar's; and unto God the things that are God's.
Mat 22:22  When they had heard these words, they marvelled, and left him, and went their way.

http://ca.news.yahoo.com/italys-fragile-coalition-bickers-over-berlusconi-conviction-165029672.html
Italy's fragile coalition bickers over Berlusconi conviction
ReutersBy Naomi O'Leary | Reuters – 1 hour 35 minutes ago.

ROME (Reuters) - Politicians in Italy's fragile coalition government traded increasingly heated barbs on Saturday over a tax conviction that threatens the political future of center-right leader Silvio Berlusconi.

The former prime minister has told his party to demand reform of the justice system - which he maintains found him guilty of tax fraud because of political bias - or withdraw from a delicate coalition with the center-left Democratic Party (PD) that has so far lasted three months.

Financial markets have shrugged off the upheaval until now, but strife in the coalition threatens efforts to revive an economy mired in its longest post-war recession.

On Friday, five ministers from Berlusconi's People of Freedom (PDL) party said they were ready to resign if needed, and senior party officials agreed to lobby President Giorgio Napolitano to issue a pardon. The party has called a Sunday demonstration in central Rome in support of Berlusconi.

more

Should we take this as meaning: we should pay attention to what's going on, but not worry as Matthew 24:6 says?

Matthew 24:6
(6)  And ye shall hear of wars and rumours of wars: see that ye be not troubled: for all these things must come to pass, but the end is not yet.

Yeah, that's how I interpreted this as well - it seems like every election year, time and time again the mainstream Churchianity community(in particular) will rally around whatever Republican candidate(yes, they did the same with Romney last year - forget W. Bush's occult connections, Romney's Mormon ties were very outward).

Right there it shows a lack of faith, instead of knowing the Lord's will be done in heaven as is on earth. Same with Italy - it was as if the citizens there acted out of fear and desperation when they rallied around a disgraced political figure who was on his way to jail to begin with.

Ultimately, yes, the Lord says let not your hearts be troubled...

http://news.yahoo.com/italian-coalition-close-breaking-point-over-berlusconi-fate-130737509.html
Italian coalition close to breaking point over Berlusconi fate
8/22/13

ROME (Reuters) - Relations between the partners in Italy's coalition government seemed close to breaking point on Thursday over whether to evict Silvio Berlusconi from parliament over a tax fraud conviction.

A row is raging between Berlusconi's center-right People of Freedom (PDL) party and the center-left Democratic Party (PD) of Prime Minister Enrico Letta following the 76-year-old media mogul's conviction by the supreme court early this month.

PDL sources said party secretary Angelino Alfano told Letta in a tense meeting on Wednesday night that the party would bring down the government if the PD voted in the Senate next month to throw Berlusconi out of parliament, something the center-left party has repeatedly said it will do.

Alfano said on Thursday he was very worried about the PD taking such a clear line before even hearing arguments in a Senate committee which begins meeting on September 9.

"We very clearly ask that the PD thinks about this, abandoning 20 years of hostility, and reflects on the wisdom of voting to remove Berlusconi," he said.

The PDL cites some legal experts as saying the anti-corruption law, under which Berlusconi would be expelled from parliament and prevented from standing as a political candidate, cannot be applied in this case.

But PD secretary Guglielmo Epifani said they wouldn't change their minds and the country could not afford a government crisis just as it starts to see the first tentative signs of recovery from its worst postwar recession.

Many PD members are up in arms over even sharing in a coalition with Berlusconi's party and any attempt to save their sworn enemy could break apart the already fractious center left.

"For us the compass is the interests of the country which come before our interests and even more so ahead of the interests of a single person," Epifani said.

Letta says the government must forge ahead to encourage economic recovery and Berlusconi's judicial problems are not an issue for his administration. "I will not accept blackmail and neither are ultimatums acceptable," he said on Wednesday night.

BERLUSCONI DESPERATE

Berlusconi is desperately trying to find a way to stay in the political game despite a four-year jail sentence, commuted to one year, for a massive tax fraud at his Mediaset broadcasting empire. He is expected to start serving the sentence, either under house arrest or doing social work, in mid-October.

Berlusconi, who has been holed up in his luxury villa near Milan since the verdict, has ordered his lieutenants to pile on the pressure in the hope of forcing the PD to at least delay any Senate judgment. His aides have unsuccessfully lobbied President Giorgio Napolitano for a pardon.

In an advance excerpts from a magazine interview published on the Internet on Thursday, Berlusconi said it would be the PD's fault if the government collapsed. "If two friends are in a boat and one throws the other overboard, whose fault is it if the boat sinks?" he told Tempi magazine.

"They cannot strip me of the right to speak on the political scene, they cannot strip me of the right to inspire and lead the political movement I founded, and they cannot take away my right to be the point of reference for millions of Italians," he said.

He added that he was sure his oldest daughter Marina, 47 and head of his $6.6 billion business empire, would not take his place at the head of the center right as has been suggested.

Despite the brinkmanship, analysts and doves in Berlusconi's party have warned that torpedoing the government could misfire, with the danger that Letta could form a new coalition with the help of PDL rebels and members of the populist 5-Star Movement of comedian Beppe Grillo.

Even if Italy went to early elections, Berlusconi would not be able to use his formidable campaigning power to the full and Letta has warned that Italians will punish anyone who causes a crisis at such a sensitive economic moment, only months after the government was formed.

(Additional reporting by Roberto Landucci and Catherine Hornby; editing by Philip Pullella and Raissa Kasolowsky)

Italian government breaks up after Berlusconi pulls out ministers
9/28/13
http://finance.yahoo.com/news/berlusconis-ministers-resign-italian-government-172431441.html

* Berlusconi's centre-right ministers resign

* Manoeuvres start to avoid new elections

* Letta accuses Berlusconi of "huge lie"

By Catherine Hornby and Antonella Cinelli

ROME, Sept 28 (Reuters) - Italian centre-right leader Silvio Berlusconi pulled his ministers out of the cabinet on Saturday, effectively bringing down the government of Prime Minister Enrico Letta and leaving the euro-zone's third-largest economy in chaos.

Talks will now start to find a parliamentary majority to back a new cabinet and avoid going back to an election just seven months after the last one.

The relentless political jockeying that has defined Letta's five-month tenure has already thwarted efforts to push through important reforms Italy needs to emerge from a two-year recession, a decade-long economic lethargy, a 2-trillion-euro public debt and youth unemployment of around 40 percent.

The resignations will delay those reforms even further.

"So many measures we were working on now risk being set back," Italian Labour Minister Enrico Giovannini told Rai state television. "On Monday our borrowing costs are going to rise by many points."

Berlusconi's move comes a day after Letta challenged the centre-right party to support him in a confidence vote in parliament.

Late on Friday, the cabinet failed to agree vital fiscal measures to bring the budget deficit within European Union limits, leaving the fragile coalition of traditional rivals from the left and right near total breakdown.

Tensions between the two sides had been rising for weeks following moves to expel Berlusconi from parliament after his conviction for tax fraud last month.

The Friday cabinet meeting had been intended to find funding to avert an increase in sales tax from 21 percent to 22 percent. That increase, which has been fiercely opposed by Berlusconi's party, will now kick in from Tuesday.

"The decision taken by Prime Minister Enrico Letta to freeze government activities, and therefore setting off an increase in sales tax, is a serious violation of the pacts on which this government was formed," Berlusconi said in a statement on Saturday.

Letta shot back later in the evening, accusing the former prime minister of telling a "huge lie" and of using the sales tax issue as an alibi for an action motivated by his legal problems.

Lawmakers from Berlusconi's People of Freedom (PDL) party this week threatened to walk out of parliament if a Senate committee meeting on Oct. 4 voted to begin proceedings to expel their leader, who turns 77 on Sunday, under legislation that bars convicted criminals from parliament.

Some opposition politicians called for early elections, but Deputy Economy Minister Stefano Fassina, from Letta's Democratic Party, said he expected a new coalition could be formed.

"I don't see elections. We won't go to them, we will find a solution in parliament," Fassina told La7 television. "I am sure there is a majority in parliament able to avoid elections."


NEW GROUPING

Letta has a commanding majority in the lower house, and if he can gain support from a few dozen Senators among the PDL or opposition groupings such as the anti-establishment 5-Star movement, he could form a new government.

Italian President Giorgio Napolitano, who has to either call new elections or oversee the creation of a new coalition and subsequent government, gave renewed signals on Saturday that he did not want the country to return to the polls.

"We need a parliament that discusses and works, not that breaks up every now and then," Napolitano said during a visit to Naples.

"We do not need continuous election campaigns, we need continuity of the government's actions, decisions and its measures to resolve the problems of this country," he said.

The political convulsions have increasingly worried investors, although with the European Central Bank guaranteeing stability in the markets, there has so far been less panic than seen during previous crises.

The ECB's next board meeting is on Wednesday.

Italy's borrowing costs hit a three-month high at an auction of 10-year bonds on Friday, while the premium investors demand to hold Italian government debt rather than German paper widened to about 267 basis points from under 250 at the start of the week.

"We are paying for our political instability," Labour Minister Giovannini told Rai.

As of Friday, Italy has raised around 81 percent of its funding target of 470 billion euros for the whole year.

http://www.telegraph.co.uk/news/worldnews/europe/italy/10480623/Berlusconi-fiancee-appeals-to-Pope-for-pardon.html
Berlusconi fiancée 'appeals to Pope for pardon'

Silvio Berlusconi’s glamorous young partner says she will appeal to Pope Francis to secure the former prime minister a pardon
11/28/13


A day after he was thrown out of the Italian parliament, Silvio Berlusconi’s glamorous young girlfriend has said she will appeal to Pope Francis to secure the former prime minister a pardon.

Francesca Pascale, who at 28 is less than half the age of 77-year-old Mr Berlusconi, said she wants to explain the “tragedy” that has befallen her fiancée, after his 20-year parliamentary career was brought to a humiliating end by the vote in the Senate on Wednesday.

He was stripped of his seat as a consequence of a definitive conviction, handed down by the Supreme Court in August, for tax fraud involving his Mediaset television company.

The decision by the Senate was “a coup d’etat — how can else can one describe it?” Miss Pascale, a former shop assistant from Naples, told Corriere della Sera.

“I appeal to Pope Francis to receive me and to hear the story of Berlusconi,” she said.

more

http://www.telegraph.co.uk/news/worldnews/europe/italy/10666138/Rome-days-away-from-bankruptcy.html
Rome days away from bankruptcy

Eternal city warns it will go bust for the first time since it was destroyed by Nero
2/27/14

Matteo Renzi, the Italian prime minister, came under pressure on Thursday as the city of Rome was on the brink of bankruptcy after parliament threw out a bill that would have injected fresh funding.

Ignazio Marino, Rome mayor, said city services like public transport would come to a halt and that he would not be a "Nero" - the Roman emperor who, legend has it, strummed his lyre as the city burnt to the ground.

Marino said that Renzi, a centre-left leader and former mayor of Florence who was only confirmed by parliament this week, had promised to adopt urgent measures to help the Italian capital at a cabinet meeting on Friday.

The newly-elected mayor faces a budget deficit of 816 million euros ($1.1 billion) and the city could be placed under administration if he does not manage to close the gap with measures such as cutting public services.

"Rome has wasted money for decades. I don't want to spend another euro that is not budgeted," Marino said, following criticism from the Northern League opposition party which helped shoot down the bill for Rome in parliament.

The draft law would have included funding for Rome from the central government budget as a compensation for the extra costs it faces because of its role as the capital including tourism traffic and national demonstrations.

Other cash-strapped cities complained it was unfair.

But Marino warned there could be dire consequences.

"We're not going to block the city but the city will come to a standstill. It will block itself if I do not have the tools for making budget decisions and right now I cannot allocate any money," he told the SkyTG24 news channel.

Marino said that buses may have to stop running as soon as Sunday because he only had 10 percent of the money required to pay for fuel in March.

He added: "With the money that we have in the budget right now, I can do repairs on each road in Rome every 52 years. That's not really maintenance."

http://www.cnn.com/2016/12/02/opinions/italy-referendum-preview/index.html
12/2/16
First Brexit, then Trump, now Italy faces its political shockwave

Rome (CNN)The world as we know it could come to an end this Sunday. Or it could be just another day. It depends on whom you talk to.

This weekend, Italians go to the polls to vote in a referendum on whether or not the country should amend its 1948 constitution.

The referendum is the brainchild of Matteo Renzi, Italy's energetic, 41-year-old Prime Minister. His intention is to defang the upper house of the Italian Parliament, the Senato, by cutting its numbers from 315 to 100, thus reducing its powers dramatically, making it more of a consultative assembly.

Yes, if you read to the end of the previous paragraph, you'll probably agree it sounds dull as dust. But, in the eyes of some, the consequences of a "No" vote could be catastrophic.

Proponents of the referendum say that the goal is to make the job of governing Italy less complicated. By allowing the cabinet to push through legislation in a reasonable time frame, Italy would become more efficient, productive and prosperous while simultaneously becoming less bureaucratic and bound up in red tape.

Italian politics is a noisy, messy, never-ending game of musical chairs, with plenty of motion but little forward movement. The once humming economy is anemic: according to one study, incomes for 97% of Italians haven't gone up in a decade. The country's GDP hasn't really budged since the late 1990s.

Some opponents say that the proposed reforms don't go far enough, while others fear that a weakened Senate will eliminate an important check on power.

more