Remember Portugal and Spain?
Just kidding, they’re front and centre, but pretty soon we need to start talking about the next round of trouble spots: Belgium is one, though the big one is Italy.
We won’t go into it too much now, but remember, it is the second “I” in PIIGS, so it’s always been in the mix.
This chart of 2009 government balances should remind you why:
So will the crisis actually spread?
That’s the subject of this piece by economists Paolo Manesse and Giulio Trigilia at VoxEU.
The good news is that despite the dizzying numbers, the markets haven’t focused on Italy just yet.
Here’s where it stands on the CDS front:
But with that much debt, and anti-austerity protests raging, it’s only a matter of time…