by Summary:
The new big fear is that this month, either or both, Moody’s and S&P, will downgrade Italian debt two notches into junk territory. The potential implications of such a move, not only for Italy but for the European project as a whole, are so huge that many market players are discounting it as a possibility altogether. “A downgrade to junk could trigger a full-blown (euro zone) crisis,” said Nicola Mai, a portfolio manager at PIMCO, the world’s largest bond investor. “…Which is why I don’t believe the agencies will do it, I don’t think they will want to be the ones causing a crisis in Europe.” Iain Stealey, a fixed income portfolio manager at JP Morgan Asset Management, concurs. “It would be a very, very big decision, just given the size of the Italian bond market; it makes up something
Topics:
Mike Norman considers the following as important: EZ, Italian debt crisis, Italian economy
This could be interesting, too:
The new big fear is that this month, either or both, Moody’s and S&P, will downgrade Italian debt two notches into junk territory. The potential implications of such a move, not only for Italy but for the European project as a whole, are so huge that many market players are discounting it as a possibility altogether. “A downgrade to junk could trigger a full-blown (euro zone) crisis,” said Nicola Mai, a portfolio manager at PIMCO, the world’s largest bond investor. “…Which is why I don’t believe the agencies will do it, I don’t think they will want to be the ones causing a crisis in Europe.” Iain Stealey, a fixed income portfolio manager at JP Morgan Asset Management, concurs. “It would be a very, very big decision, just given the size of the Italian bond market; it makes up something
Topics:
Mike Norman considers the following as important: EZ, Italian debt crisis, Italian economy
This could be interesting, too:
Mike Norman writes Dirk Ehnts – The Eurozone is Fully Committed to Modern Monetary Theory (MMT)
Mike Norman writes Bill Mitchell — Bundesbank remits record profits to German government while Greek health system fails
Mike Norman writes Bill Mitchell — The EU outdoes itself in the madness stakes
Mike Norman writes Eurozone 2020. Don’t mention the War! Bill Mitchell
The new big fear is that this month, either or both, Moody’s and S&P, will downgrade Italian debt two notches into junk territory. The potential implications of such a move, not only for Italy but for the European project as a whole, are so huge that many market players are discounting it as a possibility altogether.
“A downgrade to junk could trigger a full-blown (euro zone) crisis,” said Nicola Mai, a portfolio manager at PIMCO, the world’s largest bond investor. “…Which is why I don’t believe the agencies will do it, I don’t think they will want to be the ones causing a crisis in Europe.”
Iain Stealey, a fixed income portfolio manager at JP Morgan Asset Management, concurs. “It would be a very, very big decision, just given the size of the Italian bond market; it makes up something like a fifth of government bonds in the euro zone,” he said. In other words, contagion would spread across the Euro Zone like wildfire....Raging Bull-Shit
Italy’s Debt Crisis Thickens
Don Quijones