Spread to 322 points and the auction of the Italian BTP that make a flop due to the Italian Government's response to the European Union
Italians continue to believe in the goodness of their financial economic maneuver, not thinking that the greatest economic observers, the European Union and twenty-seven Member States think that it must be changed because it does not profit the interests of Italy and of Europe as a whole.
We hear from the Government that the EU does not understand the financial maneuver, which is not the law because it was written by a Euro-skeptical government and tries to convince the Italian people of what it says, but can not see beyond their electoral promises, the famous "book of dreams" by many announced that will only lead to a worsening of the economic situation also due to the questioning of infrastructure works for Italy, requests and participation in percentage share, even from the European Union and from France that comes involved.
All the exchanges had a negative downturn and the Italian spread had a sudden surge leading the yield on ten-year bonds to 3,59% causing a strong distrust on the part of the international markets.
The increase of spread to 322 It is a sad omen for Italy as a whole and for Italians who perhaps begin to understand the real problem and that the "dream book" should remain so until the public debt is halved and a more credible maneuver should be presented and made of real investments in the interests of the Bel Paese.
The increase in the spread to 322 is caused by the executive led by Italian Prime Minister Conte who continues to tell the European Union that he is not willing to change the content of the Italian maneuver and this will start the Eurogroup process for a procedure infringement against one of the founding countries.
But, in fact, the spread to 322 that continues to rise on what is affecting?
The constant swing of the spread over 300, is eroding the capital of the banks and this could also cause a probable default for smaller institutions with a long maturity, because they would not be able to recapitalize.
Even the largest and most important Italian banks are beginning to feel the effect of the spread to 322 and in fact for those seeking a mortgage, a loan, a surety or any other transaction involving the money trade, interest rates and the same bank charges started to rise in small doses.
With a rising 322 spread, there is a risk of a forced recapitalization also by the Italian government which, as far as it denies, patrimonial (get their hands on the savings of Italians), could be forced to avoid the default of Italy that would not be able to pay the ten-year bonds expiring.
In this climate of uncertainty and concern, many Italians, unjustly criticized by their government, are thinking about their interest, their future and alternative solutions and rather than continue to see even small investments in BTP volatilized, they begin to disinvest and move their capital in safer countries outside Italy opening up offshore bank current accounts non-EU and onshore but in other European countries.
The spread to 322 is also a matter of concern for the Italian Minister of Economy Giovanni Tria, who consciously states that the banking problem will be felt on the weaker banks as the Italian banking system is solid, but also states that it can not be unbalanced for not negatively affect the markets.
But is it only a problem of the markets or of the two parties operating in the Italian government?
Some financial advisors of SHADOIT BUSINESS CONSULTANCY LTD, Italian professionals operating on foreign markets since Britain, By United States of America, are convinced that if the maneuver will not undergo a more than justified inversion of course, even leaving it to 2,4% deficit but radically changing what at all seems to be spending current and not structural investment for a country that deserves a lot for what many entrepreneurs have made until today with the export and what many Italians have suffered with great sacrifices to recover the public debt, Italy will continue its run towards the abyss like Greece and Portugal just because of a spread that will become unsustainable for Italy.
Italian BTP demand is very weak and also weighs on other Italian bonds, waiting for the European Commission to make a decision on the opening of the infringement procedure for excessive debt, obviously weighing on an already fluctuating upward spread.
It should also be considered that Italy is not benefiting from its exports, which until now has driven the economy and allowed a more than decent GDP, the commercial war opened by the United States of America towards China and the duties imposed also to the Eurogroup countries that support the opinion contrary to the Italian maneuver issued by the European Commission.