Draghi On the Way Out in Italy
Italian Prime Minister Mario Draghi is out. He tendered his resignation to President Sergio Mattarella. Mattarella is refusing for now. There will be another confidence vote. It shouldn’t matter.
As is always the case with Italian politics, the story is always far murkier than the headline.
The headline is Five Star Movement (M5S) leader Giuseppe Conte could no longer back Draghi’s government because he’s doing nothing to deal with spiraling food and energy costs in Italy. Without M5S support it will be difficult, at best, for Draghi to maintain power.
The parties which ‘won’ the last election are now polling 3rd and 4th. M5S is now polling at just 12%. Lega just 15%.
It is Georgia Meloni’s Brothers of Italy that lead the polls. And we are, at most nine months away from Italian elections.
I’d say nine weeks is more likely.
So, M5S and Conte making this move now is not in their favor. This implies something far deeper than what it looks like on the surface.
It implies strongly that there is an urgency to removing Draghi that trumps basic power politics, that the future of Italy itself may be what’s at stake.
And I think I might know why.
Italy is woefully unprepared for this winter as gas storage is well below levels necessary to get through the winter. The problem is Italy and the EU have been lying publicly about it. According to EU data Italy’s gas system is over 65% full, with over 126 TWhrs available, in line with other major nations, like Germany.
But looking at the actual numbers, for this year, which have been fiendishly difficult to get a hold of in recent weeks (I wonder why), Italy’s Stogit, the main gas storage company in Italy, is only 53% full and that jumped significantly in recent days (link to the data from today 7/14/2022).
Compare the run rate of gas storage filling (see chart below) from today’s data versus that of 6/17/2022 where storage stood at just 37% capacity and you’ll see exactly what I’m getting at.
So, what happened around then that all of a sudden caused a shift in the gas storage rate for Italy? M5S began its campaign against Draghi’s handling of Ukraine and a general strike was called among transport workers for June 17th.
After Draghi publicly talked about settling the Ukraine conflict with Russia, Italian Foreign Minister Luigi DiMaio (former leader of M5S) openly criticized Draghi’s “immaturity” when dealing with Russia.
Now, this is where things get really murky. Remember that it was Conte who was Angela Merkel’s bagman back when he was Prime Minister to derail any potential Italian exit from the European Union, or, at least the euro. Remember also, that it was Lega’s Matteo Salvini who was openly calling for Italy to ditch the euro.
Salvini was then put under pressure from a bogus Soros-led lawsuit against him when he was Interior Minister over his handling of a boatload of refugees.
Conte staged a coup against DiMaio while they both threw Salvini under the bus when he made his move in August 2019 to take down the government and force new elections, which, at the time, Lega would have won in a walk, having more than 35% national support.
Since then Salvini has cucked out to nearly every bad move made by Italy, likely because it didn’t matter what he did.
In the end these maneuvers by the Italian political elites neutered the upstart M5S and Lega and eventually they brought Draghi in as a kind of politically-neutral caretaker Prime Minister to get the country through to the next election, which is scheduled for the first part of 2023.
Davos needed Draghi in charge in Italy to shepherd the country’s liquidation, which is where the gas storage crisis fits in. Davos moved quickly to put all of their people in place around Europe after installing Fungal Joe Biden as president in the US. Draghi being in charge in Italy meant that Davos was in charge of both sides of the Italian-American relationship.
And I’m sure they all expected they had everything they needed to ‘run the table’ geopolitically. Draghi would implement vaccine mandates, Green Passes and degrade further Italy’s competitiveness at every turn.
The euro would remain strong, Eurobond yields low, the ECB’s reputation untarnished and the Fed captive to the Democrats’ bonkers spending plans. That was the state of play when Draghi was installed in March 2021.
All that was needed was for the US to roll over and print/spend themselves into oblivion with the Democrats fully in power in the US. The Fed would be forced to monetize another 6+ trillion in debt the world didn’t want and the US would collapse, allowing capital to flow into Europe as opposed to fleeing it.
We all know how that turned out.
As I’ve been banging my shoe on the table about for the past year, the Fed, led by Jerome Powell, has been steadily undermining the Eurocrats’ agenda with tight dollar policy which started this massive bull run in the US dollar last June when he raised the payout rate on Reverse Repos to 0.05% above the Fed Funds Rate.
At the same time, Krysten Sinema (D-AZ) and Joe Manchin (D-WV) blocked the domestic agenda by refusing both the Infrastructure and Build Back Better bills in the Senate. Pelosi and Schumer were stymied at every turn and couldn’t get anything past those two.
As I said then, those two only stand tall because powerful people stood behind them. People even Davos couldn’t blackmail.
That’s a short list, FYI. It starts with the Fed and it ends with international capital not ‘down with the Comintern.’ For a full list, just look at those unwilling to sanction Russia for throwing the first punch in Ukraine.
Once that agenda collapsed and Powell’s second term as FOMC Chair secured, that set the stage for what’s happening now.
Because Draghi’s resignation begs a LOT of questions. Why would Conte, formerly Merkel’s stooge, pull out of the coalition if Davos was still in control of the situation in Italy? What changed that forced this?
I outlined the lying about the gas storage and Draghi’s wavering on Ukraine above, but is that enough? Last week Davos got a couple of scalps — Boris Johnson and Shinzo Abe. Both of them were aligned with the US, not Europe.
Europe wants to back the War against Russia without looking like they back the War against Russia. Typically European, they want to have their foreign policy cake provided by US money and eat it too.
They are going after Olaf Scholz to put the Greens formally in charge in Germany and betray what’s left of the German middle class.
You know I believe the Fed is working to re-establish US primacy over its own monetary and fiscal policy, which tracks with the way Powell has raised rates and caused heart attacks within the Eurodollar system.
Moreover, when you look at the failures of the Biden administration to get any traction globally to isolate Russia you see a Davos agenda that is failing completely.
It then tracks that weak newcomers to the Italian Swamp, like those in M5S, may have finally been given enough assurance that the situation has changed. July’s 9.1% US CPI print was enough to really begin breaking things.
The Anti-Davos factions within the US are strong enough now for them to throw off the Davos yoke, as represented by Draghi, Mattarella and former PM Matteo Renzi, and begin Italy’s bid for independence.
The Fed responds to Davos taking out Johnson by taking out Draghi and putting the EU on a path to disintegration. The euro broke parity with the US dollar on this news. Now the ECB is staring at a vortex of higher rates as the Fed is clear to raise another 75-100 bps in two weeks.
What’s Lagarde going to do? Raise rates? If so then buh-bye Italy and hello Euro-zone banking crisis.
Given how hated Draghi is in Italy, there is no way for him to continue given what we know now. Any further resistance by Mattarella will ensure the lot of them get lynched publicly.
The mood in Italy is that bad.
The likely story is that Draghi was looking the other way while Germany openly siphoned off gas meant for Italy for itself to ensure that Italy starved and froze this winter.
So, what the TL;DR?
The EU is in serious trouble. With Draghi’s fall, there is no stopping a collapse of Italian debt prices as either Davos goes for broke and nationalizes Italy’s gold reserves or Meloni comes to power with the backing of the US banks and DoD and takes the country out of the euro, if not the EU itself.
The betrayal has been total. There’s no bringing Italian loyalty to the EU back after its reveal as yet another shitty German attempt to take over Europe.
As I’ve described in previous articles, with Russia on one side and the US Fed/Banking Interests on the other the stress on the Euro-zone and the European Central Bank has never been higher.
The ECB has no answers and has as much admitted they don’t. All they can do is keep funding Italy until the US mid-terms where Davos hopes they can save the Democrats from a complete wipe out. That was also the plan.
Now Conte and M5S have blown up those plans as well.
There is a real fight for primacy over the West’s power going on. Will it be led by Eurocrat commies or Anglo corporate fascists. There are no ‘good guys’ here. They are all terrible.
This takedown of Draghi, the ultimate Davos insider, is one of the most important turning points in 2022. It signals to me that they have now lost control over the single most important country in Europe. It is the fulcrum on which the future of humanity may ultimately rest.
Given how close we are to Davos manipulating the US and the world into a global holy war for energy, as outlined by Former Secretary of State Mike Pompeo’s Three Lighthouses speech recently, I’d say I’m on the side that is working to avoid that.
20 million SPF sun block hasn’t been invented yet. I’m sure I would have seen that in Wired. For that reason alone you should probably cheer for the ignominious end of the public life of Mario Draghi.
