Markets are rallying sharply from deeply oversold conditions overnight. No legitimate news organization is picking up this story although we did blog a few days ago that would be a conceivable solution. Unfortunately the IMF doesn’t have this kind of money, the U.S. House of Representatives would need to approve additional U.S. commitments and Germany will unlikely allow the ECB to print the money it needs to add to the IMF. We remain unconvinced and are maintaining for now our short euro trade. Bear markets have vicious short covering rallies. At any rate it seems a better hedge than shorting the U.S. markets as business conditions are improving here.
IMF Readying Loan of as Much as $794 Billion for Italy, La Stampa Reports
QBy Tommaso Ebhardt – Nov 27, 2011 5:11 AM MT
l
The International Monetary Fund is preparing a 600-billion euro ($794 billion) loan for Italy in case the country’s debt crisis worsens, La Stampa said.
The money would give Italy’s Prime Minister Mario Monti 12 to 18 months to implement his reforms without having to refinance the country’s existing debt, the Italian daily reported, without saying where it got the information. Monti could draw on the money if his planned austerity measures fail to stop speculation on Italian debt, La Stampa said.
via IMF Readying Loan of as Much as $794 Billion for Italy, La Stampa Reports – Bloomberg.