Wednesday , June 23 2021

Spread Btp-Bund opens up to 317 points. Maneuver is a Day of Truth – The Economy



Spread between BTP and Bund opens, though still close to 320 points. The difference between the two shares now stands at 317 points with a yield of 3.53%. Yesterday, the index ended at 326 points after having passed 330 points.

Wall Street continues to fall, burning earnings in 2018 – Wall Street was sunk with technology and blew up in 2018. The escape from hi-tech, and especially from Apple, is fueling the fears of slowing down the global economy and strengthens those for a commercial war between the United States and China. And it feels like an oil that stops in New York 6.57%. Neither Bitcoin has been saved, which has fallen over the last 13 months to $ 4.225. For Cupertino this is a new session of passion: headlines close down for 4.79% with increasing concern over the low demand for the iPhone. Apple, worth $ 1,000,000 just a few weeks ago, is now worth 880. The collapse that increases the market value of Faang's – Facebook, Apple, Amazon, Netflix and Google – is billions of dollars in comparison to their historical records. Since July 25, Facebook has burned 250 billion. Amazon has seen 255 billion since September 4, and Google 155 since July 27. Netflix has lost $ 63 billion since June 21st. Technologists – says Donald Trump – have difficulty but will recover. The effects of Apple's fall are felt all over the world. On the stock exchanges of the Old Continent is also affected by the further uncertainty about Brexit. European squares were closed in red, and Milan dropped to 1.87% to 18,471 points, and the level it has not seen since December 2016. Wall Street's welding due to technology is a fear of global economic slowdown that could include the United States, which already struggles with the trade war with China. The emphasis is on Trump's meeting and Chinese President Xi Jinping at the G20: face to face, which could show a decisive place on the commercial front. He hopes at least that there is a general agreement between Washington and Beijing, which is able to boost the fears of American economics and companies that are hostage to the battle.

Maneuver: According to the EU's refusal, it is a debt to be taken care of – The first formal step to the opening of the excessive debt procedure will be completed tomorrow, but no foreseeable noise will have immediate consequences. In fact, it might actually be useful to stop in Italy because it will open a new window for negotiations with Brussels so that the actual sanctioning process is never going to take place. The Commission will announce another negative opinion on the draft budget today. This time it's up to date, but not for sale, November 13th. Since it does not contain "substantial and significant" changes requested by the EU, the opinion will repeat what was written on October 23rd: the maneuver contains a deviation from "particularly serious" obligations, is based on "optimistic assumptions of growth", endangers "adequate debt reduction" , which is still "a major vulnerability". These motives have brought Brussels to prepare a well-known debt report, also referred to as the 126.3 article of the Treaty that describes it. In addition to the recent surprises or recent decisions by Juncker – which will only see Premier Conte on Saturday night – the panel commission is ready to release the report 126.3 tomorrow. This is a document in which the Commission clarifies why it is not convinced of the reasons ("relevant factors") that Italy has indicated explaining the trend in the accounts. He also confirms that Italy is in breach of debt rules and warns that the procedure can no longer be postponed. It is therefore considered the first "formal" step that could lead to the opening of proceedings. But, in fact, a condition is necessary. Not only because Ecofin has to confirm every stage but also because it is not a linear path leading to sanctions. Indeed, punishments and the like (eg blocking Structural Funds) is the last step and can never happen, as has happened with Spain and Portugal: when they did not respect the return of the deficit, the Commission recommended it for months but in the meantime two governments have found an agreement with the EU and the proceedings were terminated. Even Italy could negotiate for months and never get sanctions. In any case, the possible launch of the EU procedure is unlikely to be held before January, or before the parliament approves this maneuver. But after the holidays, if the Commission confirmed this process, Ecofin confirmed on January 22nd, the most direct risk envisaged by the rules would be the other: a corrective maneuver application should take place within 3-6 months. And just after that the fines would increase, ranging from 0.2% to 0.5% of GDP. Provided that in the meantime the spread does not reach such levels that urgent and immediate interventions are needed.


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