One week ago, Italian co-Deputy Prime Minister Matteo Salvini was flying high after his party, the far-right The League, trounced its competition (and coalition partner Five Star Movement, or M5S) in European Parliamentary elections. In short order, he claimed a new mandate for wide-ranging tax cuts and taunted Brussels over its deficit limits, while his government passed a motion to explore a parallel currency known as the “mini-BOT,” which is a play on the Italian acronym for short-term Treasury bills. Eurozone leaders responded with a letter threatening sanctions if Italy broke its deficit reduction commitments, rekindling fear that the long-awaited Quitaly was at hand. Yet since then, the pendulum has swung in the opposite direction: The Treasury all but disavowed mini-BOTs last Friday, and on Monday, Prime Minister Giuseppe Conte threatened to walk and force a snap election because he couldn't abide Salvini and M5S leader Luigi Di Maio's constant bickering. Let this be a lesson in the danger of reacting to short-term fear: The story can flip fast, leaving investors chasing their tails.