Italian CDS Spreads Widen

It's very strange that Italian CDS spreads have widened and are up 38 points which is about 9% considering CDS (which is the default insurance taken out by holders of sovereign debt to insure against bond losses) was pretty much declared null and void, at least in the Greek restructuring. They would seem like a worthless form of insurance given the EU's actions taken, yet today Italy's Credit Default Swaps are exploding to the upside.

So Italian bond holders are willing to pay 9% more for something you would think would be near worthless, they must really be worried about some events taking place in Italy.