Friday, November 25, 2016

Italian referendum 4 December 2016.

We blithely plan for March but Italy heads towards a possible cliff edge on 4 December with a referendum to alter the constitution to end the capacity of the upper house of the parliament to bring down governments:   Italy has had 64 governments since the republic was established after World War II. Prime Minister Matteo Renzi has said he will resign if the vote is 'no'. He comes from the left. Today The Economist  which does not come from the left says people should vote no including because the proposed changes to the upper house would make it less representative — a bit thick coming from an establishment journal in the UK with its House of Lords! Otherwise there is a widespread apprehension that an anti-government vote in Italy, on the heels of Brexit and Trump, and with the EU destabilised, could have very wide repercussions, given the state of the Italian banks. One wonders who within the world of The Economist is shorting Italian stocks. See this review of The Big Short on the last great American crash; the review expresses concern about Italy.

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