Implode-o-Meter News - Forget "Brexit" - Referendum Looms in Italy; "Italeave" Increasingly Possible

The possibility of a "No" vote in Italy's constitutional referendum come October or November is the biggest clear and present danger to the euro's survival. Both 5-Star and the Northern League are promising a plebiscite on euro membership should they come to power in a post-referendum election... in the event of a "No" vote in October, the only economic choice for Italy would be between continued stagnation, or a return to the old economic model of successive devaluations. The latter course would naturally mean exiting the eurozone anyway.
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The chances of a "Yes" vote in the referendum have not been improved by the slump in Renzi's personal popularity following last year's attempt to reform the labor market, and a series of small bank restructurings that saw retail savers "bailed-in" -- forced to take losses -- under new European Union banking regulations. From 40% after Renzi entered office two years ago with optimistic promises of reform, the approval rating of the prime minister's PD party has fallen to little better than 30% today, much the same as that of the opposition 5-Star Movement. As a result, with two months to go the referendum is too close to call. Opinion polls indicate the "Yes" and "No" camps are running roughly equal, with a large proportion of voters still undecided.

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Forget "Brexit" - Referendum Looms in Italy; "Italeave" Increasingly Possible