Now, they have shut off Italy from the markets

Posted by Paul Murphy on Jun 12 09:33.

Was this part of the plan? Italian 10 year at 6.20 per cent on Tuesday, and rising?

And here’s a little optimism/ realism from Marc Ostwald over at Monument Securities who argues that drawing a line from Spain to Italy ignores crass differences in savings and mortgage / GDP ratios:

Once again we must highlight that while the high level of BTP yields does no favours for the Italian banks, the fact that while Italy’s debt to GDP metrics at 120% plus are ugly, its overall outstanding govt debt stands at just short of EUR 2.0 Trln, but the financial sector has savings and assets in excess of EUR 8.4 Trln, and Italy also has a mortgage to GDP ratio just south of 20% (the Netherlands by contrast has an equivalent ratio of 110%!) – so Italy is in fact rather like Japan rather than the popular myth that says it is similar to Spain, Ireland, Portugal, let alone Greece.

Related link:
Spanish banking bailout — FT Alphaville

This entry was posted by Paul Murphy on Tuesday, June 12th, 2012 at 9:33 and is filed under Capital markets. Tagged with Bailout, Italy, Spain.