Sub-prime crisis Italian style?

October 7, 2007 · Filed Under World News · 2 Comments

By now, most of the world has heard of the crisis in the sub-prime mortgage market in the United States. Many will also know about what appeared to be the near collapse of a major British lending institution, the Northern Rock.

But what about the possibility of a similar crisis occurring in other countries, Italy for example?

On the surface, it does not look as though a sub-prime crisis could happen in Italy. After all, it would seem that Italian lenders are more prudent than their State side counterparts. Further, Italians do not generally take out huge mortgages as many property purchases are funded from family resources, inheritances and the like. All seems to be sound, and risk levels appear to be low. One hopes so, anyway. The other evening though, I learnt something from someone which made me wonder whether Italy was as invulnerable to a sub-prime crisis as I first thought.

The other day, I was chatting with a union rep while having a pint down at the 442 pub. Now this chap, who works for a major multinational in Italy incidentally, told me that he knows of a few cases in which people who earn little more than one thousand Euros a month, have been managing to take out mortgages with monthly repayments as high as seven hundred and fifty Euros a month. These individuals had been coming to him because they were finding it very difficult to meet the repayments. And he gave me the impression that the numbers of people who were finding themselves in difficulties was increasing. My initial reaction was, ‘How could a lender hand out mortgages with such high repayments to people on such a low salaries?’ In answer, I was told that when going through the mortgage application process, these people intimate that they have access to enough funds to be able to cover their debt, despite the high repayments. And this mere intimation seems to have been enough to for them to have secured mortgages. This is when sub-prime crisis alarm bells began ringing in my head.

Now, even though a potentially worrying situation could exist in Italy, I have to admit that I really have no idea as to the extent of this reckless lending, and, to be honest, whether any reckless lending has indeed been taking place. I am after all, basing my suppositions on a chat with one union representative.

However, perhaps this situation needs to be looked into, so my worries can be proven to be unjustified, as I hope they are. And preferably someone should start investigating this before it is too late.

I hope that the situation in the US has already got lenders here checking and double checking the level of sub-prime type lending in Italy is still at manageable levels. Time, as always, will tell.

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Tags: banks, Britain, examine, investigate, Italian, Italy, lending, look into, mortgages, Northern Rock, sub-prime crisis, sub-prime lending, united states, USA

Scottish/Italian Sunday lunch

October 7, 2007 · Filed Under Italian Food · 2 Comments

Yes, I suppose mixing Scottish and Italian food is a bit odd, but that’s what we did today in sunny Milan when we finally got round to opening the tinned haggis which I had got from Alessandro the landlord of the 442 pub.

Now, as some may know, haggis is traditionally served with mashed potato and turnips, but not having the turnips, nor a potato masher, we resorted to the Italian purè as an acceptable alternative to mash. Our purè had cheese and ham mixed in, on the off-chance that out little one would not be a haggis fan.

While my other half found the haggis a bit odd, I thought it was fine, and it went very well with the purè. My other half went one better and started to eat her potion of haggis with Brie - which, I imagine, is not something that is done every day! Scottish purists may well have a minor heart attack upon hearing such sacrilege. However, I’m about to suggest something that the Scots would probably lynch me for, that is: How about trying haggis with polenta? I think the two would go together rather well, and would certainly make for a hearty winter repast.

Oh, and our little four year old earthquake would not even try the haggis, Brie or not. But, then again I think it would be true to say that haggis does not really have the most appetizing appearance. Still, I shall be asking Alessandro for another tin of haggis, in order that I can see what it is like with polenta. Talk about fusion cuisine.

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