A self-focused Btp tool to solve the problem Government bond crisis It is about to invest Italy. the Meloni government Think links dedicated to Italians, in particular Financially beneficialin view of the spring / summer that will be very complex for public finances, between restrictive monetary policies, and problems Search for buyers for regular bonds and BTPs in the markets, Public debt spreads long f energy crisis which shows no sign of ending.
Yes, because despite the European agreement Ceiling price (combined with a mild winter and low dependence on gas from Russia), has led to a drop in the price of methane amsterdam ttfthe problems are not solved in any way: LE Invoices Still high, as are consumer prices for all commodities. In the recent budget law, the executive branch had to be employed 21 billion eurosMost of the money available to the state, to deal with the effects of high energy prices.
However, this money is only enough to help families and businesses until the end of March. At this point, Money.it has also been informed by Matteo Giacomo di CastelnuovoBocconi Professor of Sustainability Practice, Representing Italy”We risk serious budget problems“To finance new forms of support or else, if nothing is done, the social crisis.
Briefly, The money is gone To make matters worse, finding them in the markets, and the new religion, will be difficult. There is in all this: the specter of a new stability pact (which is being debated over in Europe) and demands to contain spending from before European Union Commission. Hence the idea of a new Btp.
Because in 2023 Italy will have a big problem with BTPs
Next year, it will be for Italy 4.5% deficit Public debt reached a record high 2771 billion euros. Until now, our government bonds were largely covered by it European Central Bankwho bought it in the secondary market. However, starting in March, the so-called quantitative tightening will begin, that is, the reduction of bond purchases by the European Central Bank and the sale of those in the belly of the bank for about 15 billion euros per month.
Not only that, but also because of the gradual increase of official discount rate (i.e. the reference for all interest rates in Europe) To fight inflation, the spread between the Btp and the German Bund rose. In short, he also denounced the Minister of Defense Guido CrocitoTo sell government bonds, Italy would have to offer higher interest rates, at the risk of paying more and more when an institution such as B.C.E..
Also because investors are in turmoil. There is a fear of an imminent Western recession, with AInflation that shows no signs of deflation Indeed, the East is in turmoil (between China, which is slowly growing, and Russia, which continues its policy Ukraine invasiontake away peace).
Foreign investors, in this scenario, watched the lingering doubts Little sustainability of the Italian debt, they are less and less. In October, they reduced their exposure to 2.3 billion eurosafter cutting off their allowances 13.2 billion in September. In all this, banks and insurance companies are especially careful, focusing on the most reliable securities.
How much money should we be looking for in the markets in 2023?
In the year 2023, by reflection thanks turtleour country will have to renew government bonds worth More than 450 billion euros: an estimate of at least 310/320 has been made since then Maeve (with the issuance of medium-term long-term bonds) to pay interest on our debt and finance the new deficit. real time 10-year bond yield permanently above 4% The spread is over 200 basis points. Bnp Paribas, Deutsche Bank and Citigroup They all expect an ever higher cost of Btp.
To replace the European Central Bank in the massive purchase of government bonds can be banksEuro-zone (some have already begun to do this), besides pension funds and clients Insurance companiesbut they want higher risk premiums and returns than ever before.
What is auto BTP and why can it “save” Italy
Therefore, the urgent task of the Ministry of Economy is to find “Reliable” buyers of government bonds and avoid the continuation of their returns at levels Greece. Minister Giancarlo Giorgetti knows this very well and is with him league He is working on a new Btp project with the support of President Meloni.
the “Private Btp” or “Standalone” He can take inspiration from the bill submitted by the Vice Association and the accountant Julius Centemiro. So far, only small Italian investors have owned it 6.4% of the public debt Italian, but in the bank they have a stock 1840 billion euros. To attract them to buy government bonds, the new BTP scheme, which is aimed only at citizens residing in our country, will include tax advantages.
It will be worth 5 or 10 years and should stay to maturity, but she won’t expect it Taxes received on returns. may also be subject to Irpef deducts 30% of the valueup to a maximum of 30,000 euros. An excellent investment, and also to protect money from inflation. Then there will be one Double couponassociated with the performance of the nominal GDP. Thus, if Italy grows, there is a financial premium allocated, as is the case for the current premium PTP Futura. And again: file 50% of the total Invest can be used to access Bank loansused as collateral.
Further, the security would not be subject to short sale, thus avoiding i High speculative riskwho was also discouraged by the fact that they would be mainly Italians buying these BTPs, and hardly cared about financial collapse from their country. If the property is sold before the expiration date, unpaid taxes will have to be paid within sixty daysWithout penalties.
Possible problems of self-BTP
There may be problems though. In fact, it has been years since the Public Debt Directorate Treasury department It focuses, with various tools, on the participation of small Italian investors. So far, Btp Italia and Futura have made value Limited number of boxes, in the face of the high costs to the state. In short, the risk is to pay more without real stabilization of the Italian public debt in the market.
Therefore, the operation requires aMassive media campaignTo expose Italian families to hundreds of billions of euros. If it passes, one can be found A real alternative to the European Central Bank Without having to go on hand to ask for money Foreign banks and funds.
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