who is attacking italy's bonds? , page-3

"Lenders are saying to Italy "we believe you are risky so we want a better return", thats the prerogative of the lender."

I doubt that a lender "retreat" caused last nights sell off.

What is actually happening is that speculators in the Italian Government bond and CDS markets noticed that the bid side is thin and have hit the market. It probably didn't take a lot of volume to scare a few bond holders and start a run.

While this sort of thing doesn't help confidence in the secondary market, it does not have any direct impact on the Italian budget until the they have to roll the debt.

According to AXA, "The weighted average life of Italy's government debt is high at just over seven years, beyond that of many AAA-rated sovereigns..." It would seem that many of these lenders will have to wait some time to exercise their "prerogative".

Good luck all.