NeilI was interested to read your thoughts on both Trieste and Verona as possible candidates for the 200% club.Not sure I'd agree, though - and even if I felt they may qualify, I don't think I'd put my money where my mouth was!The trouble with both locations is that they're in Italy! And, without putting too fine a point on it, Italy is in dire straits, possibly a great deal worse than many people realise. It's easy to miss the malaise - after all, the food's still the best in the world, the tourist spots idyllic (despite those pesky scorpions), and the culture and people are as magnetic and charming as always. The world's capital of fashion isn't in danger of going out of fashion anytime soon.But beneath the veneer there's a terrible battle taking place for the future of this economy between reformists and those who believe (as I read somewhere recently) that the state is a vast cow that can be milked endlessly.Without drastic reform, Italy's debt is going to sink its way of life in the not too distant future.While the creaking coalition government makes generally populist attempts to chip around the edges of ludicrous practices such as those that used to ban hairdressers from opening on a Monday, insisted that petrol stations were sighted certain distances apart to protect them from competition AND prevented supermarkets from selling non-prescription drugs, the real problem persists. The problem of Italy's gargantuan fiscal debt.There are no real signs as yet that there is an appetite for real competition in the market place, nor for reducing the massive pension burden by raising the retirement age to 60 (from 57, the lowest, I believe in the Western world), or for slashing red tape (and the number of bureaucrats) and the introduction of a truly modern tax system that drives and rewards Italians' undoubted entrepreneurship flair, instead of strangling it at birth.There is a chance - a slim chance - that the necessary reforms will take place in the next few years. And there is clearly at least a recognition in some parts of the political arena at least of what the problems are! But the jury is very definitely out at the moment and a long way from reaching even a majority decision on whether reform will come soon enough, if at all.Without big scale reform one of two things will happen, perhaps both:1) Italy will go to it's knees economically,2) It will be forced to abandon the euro (all these problems were dealt with in the past by devaluing the much missed lire).Until the signs are there that this structural reform is really underway, I personally wouldn't invest in Italian locations that are based on the country's economic well-being.BUT, if they do come, those structural reforms - slashed taxes, slashed spending and real competition - could unleash a truly vibrant and successful economy...after the initial pain, of course.Until then, I'd stick to those eternally appealing Italian tourist destination investments anyday.Unlike a sun location, a buy in, say, Tuscany, is not dependent on the fickle and price sensitive sun holiday market, commands a very high annualised yield and its capital growth will depend not so much on the Italian economy, but on that of the UK, the German , the Irish, the Dutch and America's, as well as others.I'd say the tussle over the fate of Alitalia will be a good indicator of whether Italy has the stomach for reform and is ready to face reality. On the day that the last potential bidder for the desperately ailing airline pulled out, citing unacceptable strings to the sale - one of which essentially insists that the over-staffing must continue - sections of the airline's personnel were on strike! Says it all really!Of course, as with much else in Italy, things are rarely as they seem. And it is widely believed that the government only allowed the stringent sale conditions to avoid conflict with the unions, and in the full knowledge that there would be no takers. Now it can turn to the unions with a greatly strengthened hand. A subtle tactic. Whether it will be too subtle and too slow remains to be seen.The same can be said for reform in Italy as a whole.BestRobin