From project-syndicate.org
From the standpoint of European stability, the Italian elections could not have delivered a worse outcome. Italy?s parliament is divided among three mutually incompatible political forces, with none strong enough to rule alone. Worse, one of these forces, which won 25% of the vote, is an anti-euro populist party, while another, a Euro-skeptic group led by former Prime Minister Silvio Berlusconi, received close to 30% support, giving anti-euro parties a clear majority. Despite these scary results, the interest-rate spread for Italian government bonds relative to German bunds has increased by only 40 basis ... (full story)
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