Word: lira
(lookup in dictionary)
(lookup stats)
Dates: during 1970-1979
Sort By: most recent first
(reverse)
Italy's economy is like its wines-robust, zestful, unpredictable. Two years ago the lira was among the strongest currencies of Europe. Last winter the currency seemed headed toward devaluation. Now, in a remarkable turnaround, the lira has recovered, and a measure of business confidence is returning to Italy...
...lira's volatility reflects a particularly Italian combination of economic assets and liabilities. The nation's real rate of growth-5.5% in 1970-is among the highest in the Western world. Italy's hoard of gold and net foreign reserves is Europe's second largest, after Germany's. Yet a primitive and easily manipulated stock exchange, an outmoded bureaucracy, and unenforceable tax laws encourage Italians to invest their money abroad. Even before last winter's series of strikes and government crises, Italians reverted en masse to their old habit of carting lire across...
...Next, through a neat administrative ploy, Carli made currency speculating less profitable. Foreign banks had been required only to report their lire intake by phone to their nearest correspondent bank in Italy to receive full credit in any currency. Carli decreed that banks abroad would have to send the lira bills to Rome before they could get foreign funds. That caused a costly delay for the money-changers, who responded by discounting lire by as much...
Carli's rescue of the lira has bought time for more fundamental reforms. The Italian Parliament last month approved a package of financial measures, including new incentives for capital investment and taxes on consumer goods that would help check inflation and finance public health and housing programs. The government also has in the works a program of tax reform that would eliminate overlapping taxes, and a law that would allow domestic mutual funds to open in Italy, thus providing a local outlet for investors...
Coming atop Italy's other problems, the action was enough to bring the once strong lira down to 650 to the dollar last week, its lowest level since 1952. The irony is that Italy's labor costs are lower than those of any other industrialized country, and rapidly rising productivity will offset much of the wage increases won in the autumn strikes. Yet to achieve the rate of investment necessary for the economy to continue to grow, the country needs a government capable of inspiring confidence. Until such a government comes to power, even Italian officials admit that...