Italian Resolution Meanwhile, Italy's latest bout of turmoil is over for now, after the populist 5Star Movement and center-left Democratic Party agreed to form a coalition goverment. The 5Stars' erstwhile coalition partner, the far-right League, recently pulled the plug on that arrangement in the hope of triggering a fresh election and taking over entirely. But the new coalition means no election is needed, and Matteo Salvini's League will have to grumble from the opposition benches. Guardian
OK, I get it, deficit doesn't matter one bit. So democrats promise to not raise taxes but raise more benefits. Republicans, cut taxes but don't reduce benefits. Sooner or later, a genius will promise to both cut taxes and increase benefits for everyone and as you said, there is no downside in a fiat regime. Of course I am being sarcastic because I still don't quite understand how it works even after reading your posts over and over again.
Italy bond has been rather tradable for day traders. It has been on uptrend since 2012 and also Nov 18. In fact, Italy BTP just broke the record high last Thursday.
deficits do matter! What most people have a hard time wrapping their head around is that not only can deficits be too large, they can also be too small. If you have a basic background in undergraduate economics, then I could recommend a book such as Randall Wray's, "Modern Money Theory", to you. That was written in the 1990s (If I recall correctly). One important change since that book was published is that in the 1990's the MMT economists thought of modern economies after the Nixon Shock as being on a labor standard, whereas today, because of the influence of automation, it makes more sense to think of a country with its own fiat currency as being on a productivity standard.
And how productivity/labor standard economies relate to deficits? What I see is that developed economies tend to accumulate debt because they are net consumers, i.e. have to sell assets including their debt.
It is not impossibly complicated, but far too much to address in detail here. My suggestion, if you have an interest, is to read the MMT economists: these would include Randall Wray, Bill Mitchell, Warren Mosler, etc. Mosler comes from more of an Investment Background, the others are academicians, and there are many others. The Wray book "Understanding Modern Money," is a classic, but perhaps a bit hard to read unless you have a good basic economics background. Also the book is a little out of date but still one of the most thorough. Mitchell has a nice blog. Mosler's little book is cheap and easier to read: "Soft Currency Economics." You could do a you tube search on MMT or Modern Money Theory and turn up many lectures and forums. (It's also called "Modern Monetary Theory" by some.) It has taken many years, and will take more years yet, for economic thinking and policy to adapt to fiat currency. Commodity backed currencies are a thing of the past; they are not coming back. And good riddance!
Italy is 118th in tax collection and is a G7 country..... https://www.pwc.com/gx/en/services/...xes-2019/overall-ranking-and-data-tables.html