***LET ME REITERATE: There is plenty of news stating that Italy will capitulate to the demands of Brussels to cut its deficit to the 2 percent level because it fears the wrath of the bond markets and the Eurocrats. FALSE NARRATIVE! The Italians have the upper-hand in these negotiations for the European banks are loaded with Italian debt as are the Italian domestic banks. The problem for Europe, the ECB (and really the world) is that the amount of debt is very large, especially relative to Greece. Global financial regulations established by the Bank for International Settlements (the BIS) have said sovereign debt has a zero risk weighting, therefore no bank reserves are required to own the debt.