CONSOB, the Italian financial watchdog, invited me on November 8, 2019 to comment on their very interesting 2019 report on the behavior of Italian savers.
Several findings were indeed thought-provoking.
For example, 63% of Italian savers are loss averse according to the Report. However, their top choice (and more and more so) is bank accounts. Those have been – on average – steadily destroying the real value of Italian bank savings (their purchasing power) for years after deducting the impact of fees and inflation. And it is getting worse with interest rates going further down. In 2018, Italian savers also poured more money into life insurance at a time when the majority of guaranteed life insurance contracts also started to generate negative net real returns to their holders. The worst thing is that they are not even really aware of it.