Italian Bar Serves Up Bond Spread Cocktail

An Italian bar on Friday began serving up "Spread Cocktails" whose price goes up or down depending on the notoriously volatile differential between Italian and German bonds on any particularly evening.

"We decided to turn the stuff of Italy's nightmares into pleasant evenings," said Simone Liore, a 29-year-old web designer who came up with the idea and pitched it to his local bar in the town of Cuorgne in northern Italy.

Profits from the drink -- a rigorously Eurozone concoction of German beer, Italian prosecco and French cassis served up in a Martini glass that Liore assures "has to be tried to be believed" -- will all go to charity.

The fixed price for the cocktail is 2.5 euros ($3.4) but the price changes depending on the level of the spread after markets close.

If the spread is 500 points then another 0.5 euros are added, if it was only 400 basis points then only 0.4 euros, and so on.

"It's a way of decreasing the anxiety about financial spreads and transform a weakness into an opportunity to help people in need," Liore said.

The spread between Italian and benchmark German 10-year government bonds has increased to record levels in the past few weeks and the word is now a common source of jokes among Italians not generally informed about financial markets.