After Mario Draghi took the helm of the European Central Bank in early November, the international media dubbed him Super Mario (for more on Draghi, see editorial in TF 152). Now the world's attention has turned Italy's new premier, the other ‘Super Mario,' as the fate of the euro as a currency and the eurozone as a unified economy now likely depend on what Monti does in the coming weeks. If Italy were to default, it would be catastrophic for the EU: Italy's debt is so large that an EU bailout would require too much money, and its economy is so big that default would trigger a domino effect in the EU, likely forcing an end to the eurozone as we know it today.
Some are optimistic, however, and believe that Italy's economy is strong enough to face the international economic crisis. Italy makes up 17 percent of European Union's gross domestic product (GPD), making it essential to the eurozone-too big to fall. On November 21, Joseph Ackerman, CEO of the Deutsche Bank, said he believed Italy would make it through the crisis because ‘Italy is a rich country.' Indeed, Ackerman is right, Italy's private debt is just 36 percent of the country's GDP, while the real estate owned by the private sector is 200 percent of its GDP.