More Details On Italy’s Mushrooming Political Crisis That’s Causing A Market Panic

Tremonti, Italy’s finance minister

[credit provider=”Wikimedia Commons”]

Italian Prime Minister Silvio Berlusconi and his finance minister Giulio Tremonti met today in Rome after Berlusconi trashed Tremonti in an Italian newspaper, Reuters reports.The meeting was called to discuss Italy’s economic woes, including the recently-passed austerity measures.

The tone of the meeting however may have been uncomfortable because Berlusconi has recently become fed up with Tremonti and the poor economic data coming out of Italy. Berlusconi took to Italian newspaper La Repubblica Friday to complain about his finance minister.

“You know, he thinks he’s a genius and that everyone else is stupid,” Berlusconi said about Tremonti. “I put up with him because I’ve known him for a long time and one has to accept the way he is. But he’s the only one who is not a team player.”

The meeting between Berlusconi and Tremonti ended with Berlusconi pledging to balance Italy’s budget, but Berlusconi offered no words of concilitation or support to his finance minister as Berlusconi often has in the past.

In addition to the criticism from Berlusconi, Tremonti is also involved in a scandal involving Marco Milanese, a member of parliament. Reuters reports that Tremonti’s close friend Milanese was arrested on accusations of accepting bribes. Until recently, Tremonti lived in an €8,500 a month ($12,000) apartment in Rome belonging to Milanese rent-free.

Speculation over Tremonti’s future in Italy has caused the widest spreads of Italian to German bonds since the launch over the euro.