Price of Italian government bonds

European problem does not converge easily. Price of Italian government bonds plummeted on 9 November, and 7.4 percent at one point, yields on 10-year government bonds topped 7%, which is the danger zone. Interest rates surged margin hike overlap where the buyer is reduced from extreme concern at home and abroad, liquidity is depleted. There is a market the world's third largest, Italy government bonds is not a ratio of Greece. Most investors to invest in Europe is owned. Become the order to sell a large amount of everyone just to reduce the high has little by little, I do not support buying out very European Central Bank only (ECB).

Price of Italian government bonds fall

After fire spread to Italy, sparks jumped out to France in the European government debt crisis from Greece. European Financial Stability Fund should be even firemen (EFSF), it is becoming not deceptive. Italy consumer credit amount to only large banks of France, France does not need to be intact. French government bonds and German government bonds that are considered safe assets, light and heavy Ding began to be asked. This is while the government bond yield gap between France and Germany open. Is not only that. Yield of bonds EFSF and the expected halt of the financial crisis is also issued, rising in tandem to French government bonds. Yield gap between German government bonds and EFSF bonds has also expanded to nearly 2 percent. October 26, decided measures to make effective use of funds of the EFSF the Summit of the euro area and the European Union (EU). Is two points - and established EFSF is part guarantee government bonds, such as (1) Italy, (2) special purpose entities the (SPV), and allowed to bind the funds of the public and private sectors and the EFSF, to buy government bonds of problem country are the pillars. However, increasing the risk EFSF will increase the leverage, leading to financial burden of the euro member countries of AAA-rated that extend credit substantially. In the country of AAA-rated, France will pale financially. (GDP) ratio and 7.1% of gross domestic product budget deficit in 2010, it is greater than 4.5 percent of Italy. By any chance, if accustomed to France could lose its position as AAA, credit foundation of EFSF also fluctuation, the amount of funds that can be provided will be much less.

Italian government bonds prices

Fire fighting capability of the EFSF is reduced at a stretch, euro area as a whole do not could burst into flames. In a way that incorporate such a risk, yield of EFSF bonds and government bonds Buddha is rising in conjunction. The Japanese government large investors who hold about 20% of the EFSF bonds. I suffer write-downs EFSF bonds if fall. It is a situation that does not work visibility state that Europe is placed is complicated still. Individual's forecast the future course of events in such a situation is extremely difficult. Individual's investment decisions good timing on their own it is not easy. Is there enough risk of financial assets that I bought today, hit by plunge in tomorrow. While the linkage between assets increases, you will not be able to take off in investment easily in this situation. Is to what really shines in such circumstances, it is the foreign reserve investment is a favorite of his making pension.