http://finance.yahoo.com/news/markets-brace-crucial-italy-election-230203665.html
In this article, the author talks about a potentially volatile political environment in Italy and its effect on the bonds market. Investors are waiting to see what happens in the election before they determine the value of Italian debt, and the elections could drastically affect the interest rate on bonds. This would have a major impact on the Italian economy and the Eurozone as a whole. Subsequently, it could affect our net capital outflows if the price of loanable funds in Italy changes.
Given the current state of elections in Italy, I feel Berlusconi will win. This is an interesting article and it would be interesting to see how the results affect the US's capital outflow.
ReplyDelete