November 5, 2011
As time passes the crisis in the euro area gets worse. Italy is being forced to borrow at forbiddingly high interest rates, despite the constant intervention of the European Central Bank, while doubts are growing over the ability of France, the eurozone’s second largest economy, to hold on to its excellent credit rating (AAA) given the exposure of its banks to the European South’s debts and its unsafe fiscal finances. The mere announcement of the Greek Prime Minister, George Papandreou that he was willing to put to a referendum the new bailout package for the country, was enough to plunge international markets into greater uncertainty. There are four fundamental conclusions deriving from the events that recently took place that are worth pointing out.
Firstly the resulting chaos in the markets reaffirmed, in a clear manner, the systemic structure […]