Sorry if I’m belabouring a rather obscure and generally ‘non-sexy’ issue: government debt in the eurozone. If I am doing this it is because I think something important is happening. I missed this point during the week.

Fitch Ratings on Wednesday lowered to negative its credit rating outlooks for Italy and Portugal ? both among the three weakest countries in the eurozone ? amid concerns about their deteriorating public finances.

The negative outlooks could herald future credit rating downgrades, adding to concerns about economic divergence within the eurozone.

That’s the second time in a week (See the S&P post) that a ratings agency has done this to eurozone government debt. There are three economies in the ‘particularly at risk category: Italy, Greece and Portugal. They are ‘at risk’ not simply because they have substantial debt and/or deficits, but becuase they have this *and* important structural economic problems about the kinds of economic activities they engage in, they have a lack of international competitiveness that a drop in euro value of the order of magnitude we are seeing won’t resolve, that they are going to be forced to reduce their deficits during an ongoing economic ‘growth slowdown’, and that given their ageing populations their mid-term fiscal outlook is between poor and not-sustainable. Maybe we aren’t noticing much evidence of it yet, but the landscape beneath our feet is changing, even while we talk.

Incidentally, Italy has found another big one-off:

Italy’s government will raise as much as 4.1 billion euros ($4.9 billion) selling up to 10 percent of Enel SpA, Europe’s fourth-biggest utility, in the world’s largest share sale so far this year, the Finance Ministry said.

Italy will sell Enel shares at 7.18 euros each to institutions, Finance Ministry Director General Vittorio Grilli said at a press conference in Rome today. That’s 0.7 percent below Enel’s closing share price yesterday. Shares will be sold to individual investors at 7.07 euros each.

The thing is, you can try selling-off the furniture when you have problems paying the mortgage, but you can’t keep doing it forever.