Things in Greece have looked better. Plunging stock markets across the world are a clear indication that the woes of the country are far from over. The shock referendum could push the country into yet another crisis over the debt default.
However, the head of the Financial Services Authority has warned that this is going to seem like a minor blip when we are hit with the full force of pent up problems currently building in Italy.
Italian threatLord Turner was speaking to the Treasury Select Committee, outlining the massive threat to the UK and its banking system. The good news is that the UK banks don't actually have much exposure to Italian national debt. The bad news is that this won't make a blind bit of difference, because there's a very real risk we'll all be dragged under by it anyway.
His concern is based largely on the sheer scale of its debts. It's the third largest economy in Europe, so its debt was always going to be far bigger than the scale of borrowing in Greece. However, its borrowing as a proportion of GDP is terrifying too - it has borrowed £1.6 trillion - the equivalent of 120% of its GDP. It means that the country is spending a small fortune in paying interest on its debts, and is soon going to get to the point where it can't afford the interest payments.
International fearsThe international financial community is clearly very alarmed because they are not keen to lend to the country. When banks aren't keen to lend, it means that the Italian government has to offer even higher interest on its debts, which makes it even less affordable. At the moment it has to offer 10 year bonds at 6.34%. If it hits 7% then it will officially be in the same territory as when Ireland was forced to scratch around for an international rescue package.
Internal weaknessThe government, under Silvio Berlusconi, has pledged to take serious steps to get things back under control and boost growth. However, it did so amidst demands for the resignation of a leader engulfed in scandal and rumour, which begs the question of whether he has the political muscle to enact this sort of unpopular change.
There is talk that the European Central Bank is buying Italian state debt in an effort to help prop the country up, but this isn't the sort of thing it comes clean about for fear of spooking the markets.
It seems therefore that while the finances of Europe are already in a terrifying enough state, we ain't seen nothing yet.