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George Mason University’s Veronique de Rugy discusses why the Italian President is impacting markets.
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Good let's let's get back to how Italy is affecting -- markets -- the company is on the delusion.
Senior researcher only about the in the -- -- center at George Mason University -- welcome back.
Thank you for having me look on looking what's going on that I'm thinking that maybe the Italians will be a lot better off dumping the Europe.
And experiencing OK a lot of short -- pain but getting back to the Lira so they can devalue it whenever they like -- -- -- -- We wrong now you're not mean actually acting right now there's a really strong case for Italy to get out of the -- And it certainly probably be seeing slow torture that there -- gonna go through.
Even though -- now fate may -- the decision won't be up to them.
And as well for other countries mean that markets may actually end up deciding for them that they just rejected.
The slow torture that you talk about -- -- angry and this is one of the things that we don't hear very often it's like it's not a victory of Berlusconi Evers Fannie.
Or org willow it's actually a I mean the era of -- Monti is over.
Okay now back to the basic question.
Why should troubled death affect follows -- markets and our economy here.
When you know not one of -- like cannot straightforward things that -- these markets are global right and and they -- like a fear of what the collapse of the Euro and the connection with the US first the US is a lot of investment in Europe.
So I mean these kind of uncertainty they trigger and the spell out but there's another big thing -- I think the US is actually.
Based a lot of it's kind of -- perspective growth on expert and when.
You don't export plan the countries -- are buying your stuff are doing really really badly that's another kind of channel -- trouble for us.
What one -- one.
I am told that austerity is the result of spending cuts in Europe.
Is that accurate hardly hardly and there are some countries -- actually cut spending a lot of it.
That these countries and also overwhelmingly increased taxes taxes.
He's a tax increase as opposed to a spending come back and reduced his misery and by the way Alberta Valentin at Harvard and and and some of vehicle authors have shown and this is absolutely the worst way that you can reduce -- to GDP ratio this balanced approach of the past president likes.
So much this makes up.
It's gonna have pretend.
Spending cuts but absolutely we all tax increases that honey delusion you make a lot of sense that you will be back thanks very much I didn't appreciate it -- to add to --
