Berlusconi to play no part in Italy's future

The stability of Italy's government is up in the air, and so it the likelihood that the nation can carry out pending reforms. At this point country cannot afford another failure after Monti's government fell from power.

Prime Minister Enrico Letta will respond formally to Berlusconi's withdrawing support of his government.

Letta is proposing to split up the Il Cavaliere party and remove it from the political map. Doing this could have a negative effect on political stability in the euro zone.

The Italian risk premium is hovering at 13 basis points above Spain's. EU leaders have decided to support Letta instead of Berlusconi, a policy that jeopardizes the future of both Italy and the EU.