BREAKING CRASH 2: IMF pulls out of further Greek bailouts, may leave Italy to fate.

The Telegraph makes mention this morning of rumours emanating from the IMF that the Fund will pull out of any further Greek bailouts suggested by the EU. So far I’ve spoken to one (tired) person. She just rang back to say the story looks sound, and that US newswires are discussing whether it is confirmed or not.

This could be a game-changer, especially as my source suggests that the same factors in play re the IMF’s Greek pull-out (near 100% likelihood of default means under its articles, the IMF cannot lend) will be applied by the Fund to Italy. Italy’s bond yields reached the classic model’s point of no return last week.

How the Eunatics will deal with this could be complicated by David Cameron, who’s been deservedly caught on the hop this morning by German talk of Treaty change to settle the debt dispute.

Having refused to negotiate with Tory rebels yesterday, the Man of Straw today offered them an olive branch of social/employment law opt-out demands. This seems, so far, to be too little too late. For Nicolas Sarkozy, however, it could be too much too early: he has already asked Dave in less than polite terms to shut up.

I am bound to observe, this must be the first time in history that people called ‘the rebels’ represented three-quarters of the UK adult population. It’s an odd world, and getting odder.