The key to ringfencing the Eurozone from the effects of contagion now lies in the austerity packages being forged in Italy and Sapin under their respective new technocratic bureaucrats.
The technocrat govt in Italy has come up with a meaningful austerity package, in effect a decree called the "Save Italy" decree----- which if carried out will put Italy back on track and away from the grasps of the bond vigilantes.
Reuters says the 30b Euros package will be presented to the Parliament today.
Dubbed as a "Save Italy" package by Monti, it aims to raise more than 10 billion euros from a new property tax, impose a new tax on luxury items like yachts, raise value added tax, crack down on tax evasion and bring forward measures to increase the pension age.
Welfare Minister Elsa Fornero, broke down in tears while presenting measures in the package that will mean an effective cut in income for many pensioners.
The three-year package includes a controversial pension reform that will increase the minimum pension age for women to 62 starting next year and fall into line with men by 2018, by which time both will retire at 66.
The number of years that men have to pay contributions to receive their full pensions will also be increased from the current level of 40 to 42.
The package also raises the value-added tax (VAT) -- which has already been raised by one percentage point this year -- by two percentage points to 23 %, from the second quarter of 2012.
The whole package will be passed as an emergency decree.
Monti has said he will be renouncing his own salary as prime minister in a gesture of solidarity, as he called on Italian to amke sacrifices.
For the decree to be in force, Monti needs parliamentary approval within 60days.
The populist Northern League, the only major party in parliament opposed to Monti's government, has said it wants a referendum on pension reforms.
Will the Italian parliament do the Full Monty (i) and get the "Save Italy" decree passed?