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  • Italy's Monti says Grandson's nickname is "Spread"


    Published 12/11/2012 07:19:28
    Italy's Monti says Grandson's nickname is
    Italian Prime Minister Mario Monti (L) speaks next to his Norwegian counterpart Jens Stoltenberg after the Nobel Peace Prize ceremony in Oslo December 10, 2012. REUTERS/Lise Aserudl/NTB Scanpix

    ROME (Reuters) - Ubiquitous talk of bond "spreads" has filtered down from the power lunches of Italian bankers and brokers all the way to the kindergarten of Prime Minister Mario Monti's grandson.

    Monti revealed a family secret on Tuesday. His grandson's classmates have bestowed on him the nickname, you guessed it, "Spread", putting a capital S on the first letter of a financial term few Italians even knew existed until last year.

    In the meantime the term has become a staple of news bulletins and one of the main measures of investor sentiment during the financial crisis facing Italy for more than a year.

    "Allow me to let you in on something few people know," Monti told a morning television show in an interview that was otherwise chock full of weighty issues such as the future of Europe and the uncertainty of the upcoming Italian elections.

    "The youngest of my daughter's three children was home and saw a news program on television and they were talking about the spread," Monti said, referring to the risk premium investors demand to hold Italian bonds rather than their safer German equivalents.

    "And he said 'Mamma, but I'm Spread'".

    "The word has become so much a part of the common lexicon that they gave him this nickname," Monti said.

    "I don't know why," Monti continued, apparently in jest, since he has been credited with reducing the spread and, in turn, Italy's borrowing costs during his 13-month-old administration.

    Monti came to power a year ago, charged with rescuing the euro zone's third biggest economy from the immediate threat of a Greek-style collapse - a task most observers feel he has achieved.

    "The faults of the grandparents fall on the grandchildren," he said, laughing.

    The one person who was not laughing was former Prime Minister Silvio Berlusconi, whose return to the political scene over the weekend, coupled with Monti's announcement that he would resign soon, spooked markets and sent the spread north.

    Berlusconi, who has unceremoniously told foreign commentators and media not to meddle in Italian affairs, does not think much of the spread.

    "The spread is a con, an invention used to defeat a government majority voted for by Italians that was governing the country," he said in an interview on Tuesday morning on his own Canale 5 television network.

    "We never heard of it before, people have only been speaking of it in the past year and what does it matter?"

    After Berlusconi threw his hat back into the ring European politicians and officials warned that Monti's policies must continue to prevent a return of the crisis which forced Berlusconi out a year ago.

    (Additional reporting By James Mackenzie, editing by Paul Casciato)

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