Renzi loses Italian referendum He resigns . Italian politics thrown into turmoil. Market disturbance may follow.

The No side decisively rejected the Italian constitutional referendum 59.3 % to 40.7% . As a consequence the Prime Minister Matteo Renzi announced his intention to resign. The right and left parties will be eager to capitalize but none of them have enough support to be the government on their own. The Democratic party finished in close to a dead heat with the five star party led by Beppe Grillo each with 25 % of the vote in the 2013 election. The centre right coalition of former Prime Minister Silvio Berlusconi finished not far behind with 21.4%. So a period of instability until the next election is likely in Italian politics. In particular should a needed bailout of some of the banks be required if market losses multiply there may well be a problem in getting such a proposal through a caretaker government. Many will be holding their breath when the markets reopen Monday morning although it may take some time for the markets to assess the damage from the lost referendum in which case losses will be moderate and quickly reversed if confidence is restored.

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About haroldchorneyeconomist

I am Professor of political economy at Concordia university in Montréal, Québec, Canada. I received my B.A.Hons (econ.&poli sci) from the University of Manitoba. I also completed my M.A. degree in economics there. Went on to spend two years at the London School of Economics as a Ph.D. student in economics and then completed my Ph.D. in political economy at the University of Toronto. Was named a John W.Dafoe fellow, a CMHC fellow and a Canada Council fellow. I also was named a Woodrow Wilson fellow in 1968 after completing my first class honours undergraduate degree. Worked as an economist in the area of education, labour economics and as the senior economist with the Manitoba Housing and Renewal Corporation for the Government of Manitoba from 1972 to 1978. I also have worked as an economic consultant for MDT socio-economic consultants and have been consulted on urban planning, health policy, linguistic duality and public sector finance questions by the governments of Manitoba, Saskatchewan,the cities of Regina and Saskatoon, Ontario and the Federal government of Canada. I have also been consulted by senior leaders of the British Labour party, MPs from the Progressive Conservative party, the Liberal party and the New Democrats on economic policy questions. Members of the Government of France under the Presidency of Francois Mitterand discussed my work on public sector deficits. I have also run for elected office at the municipal level. I first began to write about quantitative easing as a useful policy option during the early 1980s.
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