The Wall Street Journal and the Financial Times, the two main business newspapers in the world, are once again talking about Italy. And the news is not flattering for the Monti government.
Austerity kills the economy. today Wall Street Journal opens up on the problems that the Italian economy is forced to face with the government's austerity policy. According to the US newspaper, Palazzo Chigi's fiscal policy is annihilating the economy, with production contracted by 1% in the first quarter of 2012 compared to the last quarter of 2011. “The core of the measures – writes the WSJ – is the increase of taxes on workers' incomes but also on consumption and real estate which, in the opinion of many economists, has a greater recessive effect than spending cuts". The consolidation of the accounts would therefore be taking place at the expense of the country's productivity, and the recession could open up worrying scenarios. It is no coincidence that the Italian situation is once again equated to that of Greece.
Monti says what's in his hat. "What happened in Greece can happen in Italy", explains Salvatore Cantale, professor of finance at the IMD Business School in Lausanne, underlining how drastic fiscal interventions are holding back GDP with the consequence of not even achieving the debt objectives and deficits. And for this - says Cantale - "Monti should tell the Italians what's in his hat, if the contraction of the economy becomes stronger or longer than expected".
Honeymoon ends. Italy is also on the front page of the Financial Times titled "End of the Honeymoon", on the photo by Mario Monti. "The technocratic government - writes the City newspaper - has acknowledged that its honeymoon is over". The fault would once again be the 30 billion austerity plan launched by the government, which would have exacerbated tensions within Italian society, causing a loss of confidence in the prime minister's ability to pull the country out of the crisis. Work, IMU and petrol are the three pillars of discontent.
But investors want Monti. In short, the Italians for the London newspaper are already tired of Monti. But the newspaper closes the piece with the analysis of the US economist Nouriel Roubini, who explains how at the moment "no investor would like him (Monti, ed) to leave now".
