And the news just gets uber-surreal. According to a Reuters report, the Italian Treasury has a "larger cash pile than generally perceived according to sources." As a reminder this is precisely the excuse that Italy used when it scrambled to cancel medium and long-term auctions for late August as was previously noted. Which can only mean one thing: in order to prevent more ongoing routs, Italy will likely now withdraw from all bond auctions for the "foreseeable future" in order to not give the market a chance to do some real price discovery. Sure enough, the subsequent Reuters headline says that the "Italian Treasury's cash pile is enough to last most of 2011." Odd that we predicted this, and the next steps, just this morning, when we said: "look for Spain to follow Italy in a self-imposed bond market exile." Translation: while Greece, Portugal and Ireland are unable to access capital markets, Italy, as we predicted, has just self-imposed a capital markets exile likely until the end of the year.