Don Quijones — Italy’S Debt Crisis Thickens

The novel large fright is that this month, either or both, Moody’s in addition to S&P, volition downgrade Italian debt 2 notches into junk territory. The potential implications of such a move, non solely for Italy but for the European projection equally a whole, are in addition to therefore huge that many marketplace position players are discounting it equally a possibility altogether.

“A downgrade to junk could trigger a full-blown (euro zone) crisis,” said Nicola Mai, a portfolio director at PIMCO, the world’s largest bond investor. “…Which is why I don’t believe the agencies volition utilise it, I don’t intend they volition desire to hold upwards the ones causing a crisis inwards Europe.”

Iain Stealey, a fixed income portfolio director at JP Morgan Asset Management, concurs. “It would hold upwards a very, rattling large decision, only given the size of the Italian bond market; it makes upwards something similar a 5th of authorities bonds inwards the euro zone,” he said. In other words, contagion would spread across the Euro Zone similar wildfire....

Raging Bull-Shit
Italy’s Debt Crisis Thickens
Don Quijones