For the first time in quite a while the one-year yield on Italian Bonds fell below the psychological level of 6%. The demand was a bit more than normal as banks all got together to waive fees for investors who purchased the bills at auction. The focus of this week now turns its attention on digesting the unified treaty proposed last week at the European Summit meeting. Many analysts and economists have already come out and said the new plan is just another way to kick the can down the road until they meet again. Adding to the fire, the ratings agencies have warned that they are very close to downgrading several European countries without warning. Personally, I think they will do this at some point during the week to prove a point.
At this point, the markets appear to be heading lower today, but as we know it only takes one headline to turn the tides in a hurry. Past performance is no guarantee of future results.
Eric Marvin, Financial Advisor, Fort Myers, Florida
JPT121211-2030
