Hungary, Greece, Spain, France and Italy: a shivering day for Europe which once again reminds us of how uncertain the battle to save the euro remains, which is again losing ground against the dollar. A few days ago the English press, which often cheers for the collapse of the euro, signaled that hedge funds were preparing for the final push against the single currency and the news of the last few hours seems to somehow endorse the more pessimistic theses even if the game remains to be played on the euro and Italy wants to spend its cards. It is no coincidence that the prime minister, Mario Monti, is suddenly rushed to Brussels and is preparing for today's meeting with Sarkozy which will be followed by next Wednesday's meeting with Chancellor Merkel. Italy wants to honor all its commitments but, having regained international credibility with the Monti maneuver and the change of government, it has its say: yes to budget control and automatic sanctions but be careful not to cause a recession with too much austerity rigid and with rules on repayment of debt that do not take into account the economic cycle.
Today is full of bad news and the most serious came from Hungary and Greece, but also Spain, France and Italy have not had quiet hours. In Budapest, the auction of government bonds failed andHungary it is heading dangerously towards default also as a result of an absurd law supported by the new nationalist Orban government which questions the independence of the central bank, as well as that of the press and the judiciary. It is likely that Budapest will have to ask for emergency aid from the Monetary Fund as the EU claims the independence of the Hungarian central bank. The florin is at an all-time low against the euro. The Hungarian crisis affects Europe closely even if not the euro and also affects Intesasanpaolo and Unicredit, which are respectively the fifth and seventh largest banks in the country.
News that is no longer encouraging comes from Greece, where the new prime minister Papademos, meeting companies and trade unions, clearly stated that, if the new European aid is not released, by March Athens goes into default. The president of the Eurogroup, Juncker, hastened to throw water on the fire by saying that a return to the drachma is unthinkable but the alarm is palpable.
If Hungary and Greece cry, certainly Spain, France and Italy are not laughing. In Madrid, a few hours after the ascertainment that the deficit exceeds 8% of GDP, the new center-right government finds itself having to deal with the urgent need to recapitalize the banks which amounts to a record 50 billion euros . In France, on the other hand, the auction of government bonds it went like this: Oat rates on the rise and demand sluggish.
Finally Italy: thecapital increase of Unicredit (which must also keep an eye on Hungary) has sunk the stock on the Stock Exchange and dragged down the whole banking sector and the list itself. But the bad performance of the banks on the Stock Exchange is also heavily influenced by the renewed tension on sovereign risk: the spread has returned to 520 and the yields that the Treasury has to offer on the ten-year BTP dangerously exceed 7%. In the press conference at the end of the year, President Monti said that he did not rule out anything to reduce the stock of our public debt, not even extraordinary measures. Maybe it's not time yet but it's good never to forget it.
