Feature? Or bug?

Although having no strong opinion at all on the matter, we find it fascinating that this week the argument that Italy did not rightfully belong in the PIIGS club because most of its public debt was held domestically is now being touted as a reason for its immediate inclusion. As FT Alphaville points out:

'They absolutely are up there with Japan and the UK in managing to tailor issuance of a lot of bonds to a big, domestic investor base. True, but on the other hand, all this complexity might end up working against Italy one day if it needs to find foreign buyers.'

We did notice, however, several comments from people who actually trade these things for a living that the mob might be moving on, having taken a few stop-loss lumps on those Spain shorts that just won't go anywhere.

Time will tell.

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