20110805 italy berlusconi tremonti 23
Italian Prime Minister Silvio Berlusconi (R) speaks with Economy Minister Giulio Tremonti during a news conference at the Chigi palace on Aug. 5, 2011. - 

Jeremy Hobson: The big news that Greece is planning a referendum tanked global markets yesterday, and sent borrowing costs higher across Europe. That's particularly a big problem in Italy, where financial officials are holding an emergency meeting today to figure out what to do. Italy's economy is six times the size of Greece's.

Reporter Megan Williams is in Rome for us with the latest. Good morning.

Megan Williams: Good morning.

Hobson: Well we've been focused on Greece, but there's a big meeting today in Italy. Italy's got it's own problems. Bring us up to date.

Williams: Italy has its own huge problems. As you probably know, the interest rates rates on Italian bonds have risen to above 6 percent, which is -- I mean, 6 percent for a long time has been considered the point of no return.

Italy has a huge debt -- 127 percent of its GDP. And it just won't be able to repay that debt if interest rates keep as high as they are right now on the sovereign bonds. But now there's huge panic in the country that it could go under if government reforms aren't pushed through very quickly.

Hobson: And we always think of Italy in the terms of the European debt crisis as one that's a little better off than Greece or Portugal or Spain -- countries like that. Is that still the case?

Williams: Well it is the case in terms of personal finances. Italians have a lot of savings. They don't have mortgages for the most part; a lot of Italians own outright their homes, so there's not much personal debt.

And the other thing is, you know, a lot of the Italian economy is still under the table. A lot of people aren't paying taxes, a lot of people are working illegally, so there's not a big enough tax base, and it makes for very wobbly government finances -- which is why Italy has become the target of speculators.

Hobson: Reporter Megan Williams in Rome, thanks Megan.

Williams: Thanks.

Follow Jeremy Hobson at @jeremyhobson