ECB President Mario Draghi avoided a financial contagion last year, promising to do “whatever it takes” to defend the euro, but analysts say the policymaker also thereby created the very conditions that led to Italy’s leadership vacuum.
This is the Catch-22 for Draghi, says Ed Yardeni of Yardeni Research.
After his headline-making promise to defend the euro, government bond yields dropped sharply in troubled euro zone countries. The Italians had faced real pressure during 2011, as the 10-year yield rose to a peak of 7.29 percent during November 25 of that year.
via CNBC
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Alfonso Esparza
trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
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