I have been there

Both Italy and Spain are starting to look more vulnerable,” said Niels From, chief analyst at Nordea Bank AB in Copenhagen. “The fear is that this is going to continue as the market starts focusing on the larger euro-region nations. (Bloomberg)
When Draghi, the governor of the bank of Italy left to become the president of the ECB, said that the Italian problems are vested interests and the many guilds/unions safeguarding their turf.

The outcome? Italy has been stagnant. As I wrote many times for my subscribers, concentration of power results in slow growth.

Italian bond yields have been soaring to the levels of Spain. Like with General Motors, people in power would rather sink with the boat than save it.

One more idea I wrote about over and over again. The European countries cannot survive together. There is too much competitive differential among them to make the one currency union survive.

Make no mistake about it. When you see the economy of a country going nowhere, the main reason is that there is too much concentration of power.

Is this what is happening to us>

George Dagnino, PhD
Editor, The Peter Dag Portfolio. Since 1977
2009 Market Timer of the Year by Timer Digest

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