With the decline in inflation, half-yearly payments have also returned to below 1% like a few years ago. To paraphrase a very successful film, mum, my BTP Italia deflated. Yes, the one indexed to inflation. What the undersigned had told you from the beginning that he did not take into account the dynamics – far from real and anchored to underlying macros – which underlie the machinations necessary for the Central Banks. The sole purpose of which, perhaps this time you will put it in your head, is to avoid making the stock markets explode. Point.
And that sentence at the beginning of the article is in italics for a reason. Not to underline its importance, but rather because a quote. To be precise, the headline of the article published on Wednesday by Sun 24 Hours prominently displayed on the homepage towards the end of the day. It already disappeared into the sea of pieces for fetishists only yesterday morning. Certain things need to be said, especially when for months it has been fulfilling its role as a Treasury information prospectus and not as a daily economic-financial information newspaper. But precisely because we first lent ourselves to the role of bass drum, it is better to keep the epilogue of the matter in evidence as little as possible. Do you think that with the BTP Valore the issue will be different? In fact it wasn’t. The rhetoric of record placement, of success, it lasted a few hours. Afterwards, the anti-deficit crusade in which the owner of the Mef did his utmost has forced everyone to a minimum level of realism. And of decency. Under the conditions offered, that placement was a colossal fiasco. And proof that retail trawling, from now on, risks returning half-empty nets to shore. A big problem for those who have to refinance. It’s a lot. And without the ECB, at least at the lender level unique instance.
Attention, what I write must absolutely not be read as an invitation not to invest in government bonds. It’s not my job. I I’m selling information, not securities. I don’t take commissions if I place something, nor do I earn attention from the Government of the day if I dress up as Giorgio Mastrota or Baffo da Crema. Everyone operates as they want. But what’s missing is the big picture. If the general and sector press wears the patriot’s helmet for each Mef issue and dedicates entire pages to describing the magnificent and progressive fortunes of the BTP on duty, abdicates his role. And, unfortunately, this is what we have experienced for at least the last two years. At least for all index-linked issues, those that promised dream coupons and which now barely manage to obtain a favorable spread compared to the same nominal maturities.
Why? Because the Government has a narrative to sell. And regardless of his colour, no one goes against the Mef. And no one goes against the banks. Which in turn, in via XX Settembre are linked by doom loops of the record holding of the same public debt. This is why they were so angry with Minister Giorgetti for the credit spread linked to the Superbonus: they feel betrayed, after so many BTPs generously kept in the budget for years. Lately, a lot less. There was the ECB. And then, albeit for countervalues ex ante and precautionary accounted for as minors, Mr. Rossi. Duly to be ensnared like the viewer of a teleshopping, showing only the advantages of the offer. Italian public debt, like it or not, has BTPs and BOTs as its underlying asset. Which, in turn, express those same accounts that Minister Giorgetti has in fact certified as out of control. Because of the Superbonus, obviously. Because we vote anyway. And the League participates too. So you can’t commit suicide completely. But at least, apart from the oxygen that was running out and forcing a cry for help, the minister outlined a red line not passable. Clear. Posing his resignation as a level crossing.
A BTP in times like these is like a purchase through consumer credit. Everyone shows the convenient installments, none Tan and Taeg. Today we are at the evolution of the species, we are at Buy Now, Pay Later. In the case of indexed BTPs, that pay in the form of a laughable coupon did not arrive too late. Because in times like this, everything changes quickly. Except reality. The unpleasant and stubborn one. The one to omit. And misrepresent.
Look at this graph, which shows us that the record recovery of the German economy expected from the projections for the end of 2023 is already struggling quite a bit. What does this mean for Italian GDP, a fundamental component of those ratios that Europe continues to throw at us and which tie the MEF hand and foot, forcing it into continuous cash operations? It means that the fallout on the subcontracting and industrial components sector which operates as the backbone of Northern Italian SMEs, in turn the backbone of the national economy, risks going well beyond the first half of this year. That is, orders, if not decreasing, will still reach the minimums. And destined to remain so. And the strong risk that an industry like the Teutonic one, heavily penalized by Covid, sanctions and delusional green policies, at least in its less niche components, opts for relocations towards the East.
Less quality, sure. But if the margins are narrowing and the crisis continues to bite, there is little that can be done. But it also means that, net of the result of the European elections which will act as a canary in the mine for those of the Lander scheduled for autumn, Germany will not accept any type of mediation and compromise at European level on the Stability Pact. The second narrative totem of this period in our country, after that of autarchic drunkenness and with Japanese profiles towards domestic debt ownership.
If anyone in the Government thinks they can account for decidedly relaxed adjustments to the parameters that we are already exceeding in the next Def estimates, they are doubling the damage already done by the Superbonus. And allocating the country to a succession of emergency cash operations, since one corrective maneuver per year is already written in the numbers voted for Yes last April 28th at the summit of EU agriculture ministers. Just to lower the debt ratio, around 15 billion a year is needed. Then there’s the Def to keep things going. The whole story needs to be told. Even the sad pages. And the fact that, putting the book on the scales, these are much more than the cheerful ones, must be attributed solely to our political class. It is no coincidence that we are standing thanks to the ECB. And if we do not undergo an infringement procedure in the form of a disguised commissionership, it will only be due to the presence of Mario Draghi at the head of the Commission.
It wasn’t Europe that reduced us like this. Europe just crushed the detonator. Thank the First and Second Republic for having buried the anti-personnel mine, while sending you into retirement with 15 years, six months and one day of contributions, knowing that the bills would be blown. Or he gave away billions to state salaries, cathedrals in the desert and entrepreneurs who still today love to privatize profits and collectivise losses through redundancy payments and state aid. The reality, gentlemen, is this. Like it or not. And now present the bill.
— — — —
We need your contribution to continue providing you with quality, independent information.
SUPPORT US. DONATE NOW BY CLICKING HERE
© ALL RIGHTS RESERVED
