Glendevon King: Italy to ask for ECB’s help in 2013
Following the recent earthquake in Italian politics, with the decision by technocrat prime minister Mario Monti to leave his post earlier than the country’s general elections, there is a clear risk that Italy will have to ask for the intervention of the European Central Bank in 2013, according to Nicola Marinelli, portfolio manager at Glendevon King Asset Management.
According to Marinelli (pictured), Italy is living its worst economic crisis in the last 50 years and unpopular austerity measures are putting some distance between Silvio Berlusconi, who said yesterday he’s ready to run for office again, and Monti.
“Berlusconi saw his popular support diminishing quickly in the polls and he was disappointed by the conviction that was issued against him: he wants to return to power in order to be able to control the pressure on his person and his companies through the parliament, the media and the government,” the manager said.
The most probable scenario and also one of the worst is that the new Parliament finds itself unable to express a clear government due to the lack of a clear majority and different balance of powers between the Lower and the Upper House.
“The three political forces do not share anything in terms of political and economic programmes and they also hold grudges on each other: it would be difficult to have a Grand Coalition,” Marinelly said.
These forces are the PdL (Silvio Berlusconi), which has proved to be unable to maintain Italy on the right path; also its focus has always been and will be on its leader rather on the country; the PD (Pierluigi Bersani) which is heavily backed by old politicians with communist views and the unions and will be unlikely to push through the much-needed reforms Italy needs in many areas: the M5S (Beppe Grillo) which does not have a clear programme especially for the economy and much of the proposals, albeit welcome, seem minor, focused on internet and for the sake of protest in the perspective of the bigger scenario.
“Anyway the future of Italy looks uncertain even if you had one of the three parties winning a majority big enough to secure a government; I think that none of them would be able to maintain Italy on the right path economically speaking,” Marinelli said.