Having sold out the Republican fiscal rectitude credo at home by ballooning the deficit, Donald Trump is now set to take his penchant for budget profligacy on world tour.
According to a truly absurd report published Friday in Corriere della Sera, the President last month told Italian Prime Minister Giuseppe Conte that the U.S. is prepared to buy Italian government bonds in 2019. The news comes just weeks ahead of the closely-watched Italian budget announcement which has the potential to put the new populist government at odds with Brussels over a possible breach of the bloc's deficit limit.
The spread between Italy's borrowing costs and those of Germany has widened back out to levels seen amid the BTP market meltdown on May 29 and League leader Matteo Salvini continues to insist that he and Di Maio won't bow to market pressure when it comes to making domestic policy.
The ECB has been the only net buyer of BTPs for quite some time and the irony is that officials in Italy now want to have their cake and eat it too. They want to criticize "eurocrats" and insist on thumbing their noses at Brussels but they expect Mario Draghi and the central bank to effectively subsidize the
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