Senate paves way for Berlusconi exit (FT)
Italy’s senate on Friday approved reforms to cut the budget deficit and liberalise the economy, setting the stage for the expected resignation of Silvio Berlusconi as prime minister over the weekend and his replacement by an interim government led by technocrats. … Mr Berlusconi is then expected to resign, as he promised to Giorgio Napolitano, head of state, on Tuesday after losing his absolute majority in the lower house. Mr Napolitano would next open formal consultations with the main figures in parliament with the aim of nominating Mario Monti, former European commissioner, as prime minister as early as Sunday.

Papademos Seeks to Avoid Greek Collapse (Bloomberg)
Lucas Papademos, a former vice president of the European Central Bank who will be sworn in as prime minister of a Greek unity government today, faces the immediate task of securing funds by implementing budget cuts to avert an economic collapse. … “I am confident the country’s participation in the euro zone is a guarantee of monetary stability,” Papademos said. “The country’s participation in the euro zone, despite the difficulties it is facing, will facilitate the adjustment of the economy and growth and we must all be optimistic on the final outcome as long as we are united.”

Inside the Hunt for MF Global Cash (WSJ)
“Their books are a disaster,” Scott O’Malia, a commissioner at the Commodity Futures Trading Commission, one of the regulators leading a hunt that has stretched 10 days so far, said in an interview. “We’re trying to figure out what numbers are the real numbers.” … “I always knew the records were in shambles, but I didn’t know to what extent,” said Thomas Peterffy, chief executive of Interactive Brokers Group Inc., which had for years considered doing a deal with MF Global. The company walked away from a handshake agreement to rescue MF Global after discrepancies in its books emerged, according to people involved in the discussions.

Ahead of New Rules, Europe’s Banks Go on a Selling Spree (DealBook)
Banco Santander, Deutsche Bank and others are trying to sell assets and loan portfolios to reduce their exposure to worrisome private and sovereign debt as part of a broad strategy to refocus on their home markets and comply with new regulatory requirements. It is an extraordinary fire sale. Europe’s financial sector is expected to sell or write down more than $1.8 trillion in loan assets in the next decade, according to the consulting firm PricewaterhouseCoopers. That compares with just $97 billion from 2003 to 2010.

Nouriel Roubini: Why Italy’s days in the eurozone may be numbered (FT)
Italy and other illiquid, but solvent, sovereigns need a “big bazooka” to prevent the self-fulfilling bad equilibrium of a run on the public debt. The trouble is, however, that there is no credible lender of last resort in the eurozone. … Only if the ECB became an unlimited lender of last resort and cut policy rates to zero, combined with a fall in the value of the euro to parity with the dollar, plus a fiscal stimulus in Germany and the eurozone core while the periphery implements austerity, could we perhaps stop the upcoming disaster.

How the Plummeting Price of Cocaine Fueled the Nationwide Drop in Violent Crime (Atlantic Cities)
Once the margin of profit for dealing small amounts of crack cocaine disappeared, being part of the drug trade was no longer worth the persistent threat of violence or the stiff criminal penalties. A 70 percent drop in cocaine prices like the one that occurred in the mid 1990s combined with competition from decentralized sources for methamphetamines and prescription narcotics would completely eliminate the minimum wage drug dealer as a viable profession.

Rick Perry explains debate gaffe (NYDN)
“I just learned Justin Bieber is my father.”
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