They say that Berlusconi is under fire for not putting through his austerity program. They talk about Italy’ huge sovereign debt and reveal that its debt is 120% of its GDP. Italy’s 10-year ond may have just raised its yield to 5.23%, .23% wider than the benchmark German bundt. But what else does anybody expect of Italy? It sounds rather like an Italian opera. We wait for the fat lady to sing.
Germans and other Europeans have made jokes about the Italians for a long, long time. Italians are familiar and fit like an old, comfortable shoe. There is no possible talk of Italy, no matter what happens, dropping out of the EU. Italy is the heart of Europe historically and related to all the other countries as a sort of Mother Country. In addition, it’s a comfortable beach resort for the rest of Europe and a great place to go for food and high culture.
That said, Greece is just the opposite. Greece was occupies by the Turks for centuries. It’s a place where East Meets West. As such you can expect lots of violent clashes and protests. It’s a Balkan state. Another Balkan state, Serbia, kicked off World War I. Greece could very possibly drop out of the EU and create a crisis, whose ripples and waves would be felt around the world.