With yields on Italy’s 10-year government debt rising sharply higher and beyond the seven-percent ceiling deemed unsustainable, Italy is running out of options in finding buyers for its debt. It is also running out of options as a sovereign nation.

The downward spiral of the Greek economy — and now likely that of Italy — has led to calls for the European Union to step in and prevent a total collapse. Portugal, Ireland, and Spain — the other three of the so-called PIIGS EU member-states — are enduring their own woes, such as downgrades of sovereign debt and corresponding jumps in the interest rates on government bonds. The cumulative effect — particularly if Italy does suffer a crisis serious enough to reduce its national credit rating to junk-bond status — will ripple throughout Europe and across the Atlantic.

Silvio BerlusconiWith Greece’s Prime Minister George Papandreou agreeing to step down in order to secure more bailout funds from the ECB, attention turned immediately to Italy’s financial problems that dwarf those of Greece’s. The Greek PM’s decision now clears the way for an interim government to agree formally to the new austerity measures demanded by the European Union as a condition of receiving additional financing by the end of the month. Those funds are needed to pay Greece’s bills through January 2012.

Rosen Plevneliev managed a narrow victory in Bulgaria's recent presidential elections on a reform platform pledging to clean up the country's corruption-plagued government, one of the most notorious in Europe. On November 3, Plevneliev was certified as the official winner in Bulgaria’s presidential race. The President-elect immediately declared that the first thing he plans to do after assuming office is fire all Bulgarian diplomats abroad who have been exposed as former agents of the communist Committee of State Security (CSS).

Using “financial stability” as justification, the European Union is quietly plotting to foist a massive, perpetual bailout machine on eurozone members that critics say represents a “dictatorship” and a “treaty of debt.” But opposition to the scheme is growing quickly.  

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