The letter

Public debt and savings: why Italia needs the Money Market Fund model

The purchase of government debt securities by our savers appears to be an optimal prospect that would reduce anxiety on the part of those responsible for managing it

by Antonino Galloni

5 May 2026

2' min read

Translated by AI

Versione italiana

2' min read

Translated by AI

Versione italiana

Dear Director,

i read with great interest the article by Paolo Becchi and Giovanni Zibordi published in your newspaper on 28 April 2026 on public debt management.

It suggests imitating, also in Italia, the American model of collecting savings - by a financial institution, the Money Market Fund (MMF) - to channel it into short- and very short-term government bonds; obviously the MMF buys us medium- and long-term bonds with higher rates of return.

Thus, all three parties involved remain satisfied: savers have a 'safe' and higher remuneration than the yield on deposits or current accounts (but can recover liquidity whenever they want); the state places its securities at current interest; the intermediary earns the difference between short-term and long-term yields.

Such a thing would also be possible and desirable in Italia, where operators who can already do this exist and are the banks themselves, which have historically, since the distant Middle Ages, juggled between satisfying their customers' demands for immediate liquidity and ensuring confidence in the future realisation of longer-term loans.

But two problems arise: the state, i.e. the management of public debt, is reluctant to seek a balance between the rates on offer and the saturation of demand (the latter is almost always higher than supply), which makes the political and monetary authorities feel comfortable, but places a greater burden on taxpayers; the banks - which mainly act as intermediaries between available liquidity and financial securities - are not very keen on dealing in government debt securities and tend to suggest other uses, thus tending to accentuate their customers' risk (even, too many times, with the same promised profitability).

Be that as it may, the purchase of public debt securities by our savers appears to be an optimal prospect that would make it possible to reduce the anxieties on the subject on the part of those responsible for managing it; even in the event of possible speculative actions, intervention on the secondary market would allow buyers to do golden deals: provided that an appropriate rating agency helps to keep in the balance sheets of companies (and banks) the public securities that may be the object of hostile speculation, motivated by political antipathies and not by the 'fundamentals' of our economy, which are, of course, sound.