Europe Closes With Italy's Worst Day In 19 Months

Tyler Durden's picture

While all eyes were on Italy today - and we will get to that below - Swiss 2Y rates turned negative once again for the first time in a month; EURUSD relatively flatlined around 1.3050 (250 pips lower than pre-Italy); Europe's VIX exploded to almost 26% (from under 19% yesterday); and 3-month EUR-USD basis swaps plunged to their most liquidity-demanding level since 12/28. Spain and Italy (and Portugal) were the most hurt in bonds today as 2Y Italian spreads broke back above 200bps (surging over 50bps casting doubt on OMT support) and 3Y Spain yields broke above 3% once again. The Italian equity market suffered its equal biggest drop in 6 months falling back to 10 week lows (and down 14% from its end-Jan highs). Italian bond yields (and spreads) smashed higher - the biggest jump in 19 months as BTP futures volume exploded in the last two days. Something dramatic has changed as the fast money is running with bonds and stocks going out at their lows of the day. In CDS-land, Italy is now 'riskier' than Spain for the first time in a year.


Italy 5Y CDS rose above Spain 5Y CDS for the first time in a year...


Broadly ugly...


Italy - last two days... even as the short-selling ban provided some stability...


Italy - longer-term...

Notice the difference in volume on this downturn relative to the similar sized dump in December... it is different this time...


Charts: Bloomberg

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buzzsaw99's picture

Blatant banker manipulation.

rotagen's picture

Well it looks like the Italians might finally be mounting an immune response to the great unelected bankster parasites.

Sophist Economicus's picture

We didn't think 'the establishment' was gonna make it easy for the Italians wandering away from the script, did we?

JenkinsLane's picture

The uppity peasants need to be taugh a lesson.

Freddie's picture

The same thing happens in  the USA.   Try to cut any spending and the bansketers will punish the Republicans.

Accounting101's picture

Stop the tribal bullshit Fred! There is not one damn discernible difference between the two political parties. Obama and the national democrats are corporate and financial industry whores just like the republicans.

One more thing. Do you understand that your incessant ramblings of reduced government spending will result in greater private debt? You didn't think it was economically logical to cut both government spending and reduce private debt, did you?

nodhannum's picture

Accounting 101, back to Dailykos and/or DU with you.  Cut the party line bullshit!

Accounting101's picture

So you then agree with my point about tribal politics??? Christ! Read the post and understand it before replying.

venturen's picture

You mean all those republican that voted against TARP?

Accounting101's picture

Right, those gallant republicans were against TARP before they were for it. The oligarchy love rubes like you. You help make them very rich.

takeaction's picture

Why did Gold and Silver just go crazy?


Nothing To See Here's picture

Berlusconi must be doing something right if the EU's politbureau plan goes astray as soon as he prevents their puppet from a majority...

MarsInScorpio's picture

The everyday people of Italy have had it with knowing they are getting looted by a completely criminal class, known as banksters and politicians.


The reason we don't see this in America is because a big enough section of the population is not getting whammed by their criminal conduct - yet.


Just wait until all those college-educated people find out their retirement dream vaporized, a la Corzine . . .


Yeah, it's going to suck hurting the way your body hurts when you are 70-years old and still standing on your feet all day at WalMart or McDonald's to make ends meet - especially when the FDA, DEA, (because they don't want to lose any funding), and insurance companies (because they pay for the scripts), are colluding to keep those pain killers out of your hands.


"No painkillers for you!!"


So why exactly do you think marijauna is getting pushed for legalization? 


1) Tax revenue


2) Pain relief - that you can grow without hitting the insurance companies for co-pays. (And the Feds will have to oversee that you paid your taxes on what you grow - so their budget is safe.)


3) The oldsters remember that it didn't do squit to mess up their minds, but they ate the oppostion to it because it wasn't worth the costs associated with having the idiots who never used it tell them how bad it was - why mess up your career for the sake of some air-for-brains Big Mouth in the office?


But I digress. Give it about 5 - 7 years, and it will hit Americans that they've been looted, and all their dreams are just that; night-time fictions brought about by the random firing of brain cells dumping data from the previous waking period.



tango's picture

Is it Stockholm Syndrome?  I see posts like this all the time that savage the evil politiians and bankers who have obtained such power over the poor, innocent people.  But it is those people who elected over and over the very politiians who screwed up things and made it possible for TBTF and other such idiocies.  And yes, hundreds of scientific studies have shown the effect of MJ on the brain - none of it good for long term use (which is why it is so effective for pain).   I couldn't care less if someone wants to zone out for a while but repeated use will have an effect.   Amerians are too busy trying to (if they're productive) plan, save and stay ahead or (if they are takers) figuring how to game the system for eternity to come to any dramatic realization. 

StychoKiller's picture

Hmm, over 10 years of self-medication, yet I STILL know that ?sin(x)dx = -cos(x) + C

Notarocketscientist's picture

The majority of the people in the world are fucking idiots (I might be included - but I don't think so)

TNTARG's picture

Of course. I told my friends and relatives in Italy just last night il will be this way. But I love Grillo's statements:

"You press people should ask yourselves who owns the media you work for".

"You press people should think about your role in the italian mess".

"You press people shoud revise your performance".

"Now they're gonna go for a "governissimo", but we would never allow them to, it's gonna be hard for them".

"No alliances, we are going to study and analize every proposal and see if it's good for italians or not".

"The're done. It's a matter of time. They can keep going... what? 6, 8 months then it's gonna be their end".

I wish they succed. Out of the fuck...g Euro. Italy for italians, Italy as the "peninsola" we all love!

Wakanda's picture

I'm liking Grillo allready.

He's a comedian that makes me smile even when he's a politician!

Everybodys All American's picture

The Fed is spending a lot of money trying to keep this market from tanking.

No Euros please we're British's picture

While the market tanks, Benny cranks and the SEC have other things to be going on with.

venturen's picture

CAn we loan them a printing press that prints euro or lira or something.

StychoKiller's picture

The US Bureau of Printing and Engraving does a lot of currency printing for foreign govt's already.