EDITORIAL
Published: November 10, 2011
There was nothing unpredictable about the financial crisis now threatening to engulf Italy and perhaps bring down the euro. Economists and analysts have been writing about it for months, but Italian politicians, starting with Prime Minister Silvio Berlusconi, did almost nothing to head it off. And European leaders like Chancellor Angela Merkel of Germany and President Nicolas Sarkozy of France did far too little to prepare for it. Related News
Greece and Italy Seek a Solution From Technocrats (November 11, 2011)
Times Topic: European Debt Crisis
Related in Opinion
Paul Krugman: Legends of the Fail (November 11, 2011)
Op-Ed Contributor: Can Italy Put Berlusconi Behind It?(November 11, 2011)
Readers’ Comments
Share your thoughts.
This week, the long predicted storm broke, sending Italian interest costs above 7 percent and triggering stock market sell-offs around the world, Wall Street included. Italy, the euro-zone’s third-biggest economy, after Germany and France, is too big to be rescued by the European bailout fund and too big to fail without, most likely, taking down the euro itself. Italy’s essential problem is not high deficits, or even high debt, but years of dismally slow growth, which makes the debt harder to pay off and investors more skeptical about its continued ability to repay. That’s why interest rates are rising, compounding the repayment problem.
There was nothing unpredictable about the financial crisis now threatening to engulf Italy and perhaps bring down the euro. Economists and analysts have been writing about it for months, but Italian politicians, starting with Prime Minister Silvio Berlusconi, did almost nothing to head it off. And European leaders like Chancellor Angela Merkel of Germany and President Nicolas Sarkozy of France did far too little to prepare for it.
Related News
Greece and Italy Seek a Solution From Technocrats (November 11, 2011)
Times Topic: European Debt Crisis
Related in Opinion
Op-Ed Contributor: Can Italy Put Berlusconi Behind It?(November 11, 2011)
Paul Krugman: Legends of the Fail (November 11, 2011)
Readers’ Comments
Share your thoughts.
This week, the long predicted storm broke, sending Italian interest costs above 7 percent and triggering stock market sell-offs around the world, Wall Street included. Italy, the euro-zone’s third-biggest economy, after Germany and France, is too big to be rescued by the European bailout fund and too big to fail without, most likely, taking down the euro itself. Italy’s essential problem is not high deficits, or even high debt, but years of dismally slow growth, which makes the debt harder to pay off and investors more skeptical about its continued ability to repay. That’s why interest rates are rising, compounding the repayment problem.
