After Spain, is Italy Next?

By: Ian Campbell | Wed, May 16, 2012
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Why Read: Because now that Spain's economic woes are close to the center of world economic attention you need to focus on Italy - while still keeping Greece, Portugal, Spain and the Netherlands squarely on your ever more crowded radar screen.

Featured Article: A May 15 article focuses on Italy's current debt levels and debt yields, reporting on:

Commentary: Having suggested some months ago, when Spain seemed to be off most media radar screens when it seemed it should be on them all, it now seems Italy is moving ever closer to joining Greece and Spain as an important 'center of attention'. Consider that France may be several months behind, but given its recent non-austerity government mandate, is nonetheless 'in the theatre', perhaps edging toward 'the wings' and might yet tip-toe toward center stage.

Supplementary to the foregoing;

Clearly, increased focus should be directed to Italy going forward. Simply put, Spain may well prove to be 'too big to fail', at least for the time being. If that is true, it has to be even more the case with Italy. If concern is being voiced with respect to possible contagion issues related to Greece, imagine the escalated extent of contagion concern if Spain's and Italy's economies continue to deteriorate.

Importantly, watch for escalated discussion and concern over real and nominal GDP growth generally, and country specific real and nominal GDP growth. Simply put, without real GDP growth economic trends in the developed and developing countries are virtually certain not to be positive.

That said, pay careful attention to media and other data on Italy going forward as you think about and plan your financial affairs. Italy is definitely something to discuss with your investment advisor(s), and most astute financial friends.

Moody's Downgrades Italian Banks
Source: The Wall Street Journal, David Enrich, May 15, 2012
Reading time: 3 minutes

Italy's banks shaken as economic slump deepens
Source: The Telegraph, Ambrose Evans-Pritchard, May 15, 2012
Reading time: 4 minutes

List of countries by GDP (nominal)
Source: Wikipedia
Reading time: 3 minutes

Italy Inflation Rate
Source: Trading Economics
Reading time: 1 minute

Italy Unemployment Rate
Source: Trading Economics
Reading time: 1 minute

Europe's perpetual 'wasted youth'
Source: Business Spectator, Marco Annuziata, May 14, 2012
Reading time: 3 minutes

 


 

Ian Campbell

Author: Ian Campbell

Ian R. Campbell, FCA, FCBV
Economic Straight Talk

Through the Economic Straight Talk Newsletter Ian R. Campbell shares his perspective on the world economy, the financial markets, and natural resources. A recognized business valuation authority, he founded Toronto based Campbell Valuation Partners (1976), Stock Research Portal (2007) a source of resource companies market data and analytic tools, and Economic Straight Talk (2012). The CICBV* annually funds business valuation research in his name**. Contact him at icampbell@srddi.com.
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** through The Ian R. Campbell Research Initiative

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