High inflation like a Hydra, risk for democracy - Consob

(ANSA) - ROME, JUN 9 - High inflation is like a Hydra with many heads and is a risk for democracy, the chairman of Italy's stock market regulator Consob Paolo Savona said on Friday.
    "Inflation is like a hydra with many heads; if one is cut off and cauterized, the others act," said Savona in an address to the financial markets.
    High inflation also "creates the conditions for a deformation of democracy and the emergence of forms of social violence," continued the Consob chairman, adding that "bringing down inflation without creating a depression and social imbalances is a very difficult task".
    Savona said increases in the cost of living have been transferred to taxation, but not to salaries, "which have so far shown greater rigidity".
    "Financial wealth continues to experience a serious depletion of its real value," he added.
    "Money, banks and capital markets are propelled in the same direction by the power of technology, which already plays an important role in real development and social stability," continued Savona, saying that it therefore becomes urgent to reconsider how to "realign burdens and regulations, including fiscal ones, among the different forms of savings investments, correcting distortions that have become embedded over time and countering the inequality in distribution that they bring about".
    Italy has always been able to cope, said Savona, adding that many past difficulties have been "far more serious than those we are currently experiencing". "There is no reason why it cannot manage even in the current difficult international circumstances where, among other things, the winds of war have begun to blow with greater force, under the impetus of national egoism that has never been quenched," said the Consob chairman.
    Italy "has given its best in every era and in every circumstance", he continued.
    "Why should the opposite happen today, knowing full well that we have cultural and material resources just waiting to be mobilized?" (ANSA).