Reports - Spain to officially request EU/IMF bailout this weekend

darkman2

http://www.bbc.co.uk/news/business-18368024


Domino number 4 about to fall. It's been coming for many months now. Finally the Spanish are facing up to reality.


They were trying to get a bailout for their banks ONLY thereby avoiding IMF monitoring of their sovereign. Imagine how the Irish would feel about that? That's hardly going to happen given other countries would want the same.

Dirk Gently

darkman2 wrote: »

That's hardly going to happen given other countries would want the same.

Eamon Gilmore was already distancing the Spanish bailout to any knock on for the Irish one so it looks likely that Spain will get some kind of deal which will not be applied to the other 3 bailout countries. Mickey mouse countries like Ireland and Portugal matter little if they protest tbh. Spain and Italy will be different, less degrading bailouts. Ireland better get in quick if we want a second bailout, might not be any money left soon.

Sand

Interesting that the confirmation is coming from non-Spanish sources leaking reports to the press. They're trying to bounce Spain into a bailout by locking them out of the debt markets, much as they did Ireland.

European Central Bank Vice President Vitor Constancio said the call for assistance was expected soon.

"It is expected that Spain will formulate a request for aid exclusively for banks recapitalisation ... there has to be an expression of will to have such a programme for Spanish banks, and one may hope it happens rather swiftly," Constancio said on Portuguese radio.

Ireland will get little benefits because Ireland has been proudly telling everyone the bailout is working, that Ireland wont be bribed by offers of debt relief and that Ireland is not Greece/Spain/Italy - that Ireland is a hard working, hard exporting little northerner. So why change what is working and relieve the pressure on the Irish to reform and apply fiscal discipline? The deal is working, right? And we don't want to risk moral hazard, right?

I believe that the Irish offered these views in a <Mrs Doyle/Gwan, gwan> mindset, but the Germans will accept them as valid and realistic. Especially when there is not much bailout firepower to go around.

Lawrence1895

Sand wrote: »

Interesting that the confirmation is coming from non-Spanish sources leaking reports to the press. They're trying to bounce Spain into a bailout by locking them out of the debt markets, much as they did Ireland.



Ireland will get little benefits because Ireland has been proudly telling everyone the bailout is working, that Ireland wont be bribed by offers of debt relief and that Ireland is not Greece/Spain/Italy - that Ireland is a hard working, hard exporting little northerner. So why change what is working and relieve the pressure on the Irish to reform and apply fiscal discipline? The deal is working, right? And we don't want to risk moral hazard, right?

I believe that the Irish offered these views in a <Mrs Doyle/Gwan, gwan> mindset, but the Germans will accept them as valid and realistic. Especially when there is not much bailout firepower to go around.

Germany will accept the Irish proposals for the moment, as far as I understand from friends and relatives in Germany. But Ireland can't afford to bottle it, the government has to keep their promises, they made to Germany.

jank

Wow, two posts in and already we are bashing Ireland. Well done lads keep up the good work.

Zonda999

http://www.bbc.co.uk/news/business-18382659

Fourth bailout is official then..

The fact they are saying this is a 'bank bailout', does this mean that Spain will still be attempting to borrow from the markets seeing as they still have their exchequer deficit, which is in the order of 6-7% .

Solair

Interestingly, I supported a link to this on an El Mundo story earlier on about the Spanish bailout quoting the Frankfurter Allgemeine Zeitung

http://www.faz.net/aktuell/wirtschaft/rettungsfonds-spaniens-stolz-11778271.html

It seems the Germans are sticking up for us, and seeing that this is totally unfair, while our own Government isn't bothering!

"Even if it this weekend does not seem to be as far as Spain is likely sooner or later submit a request for help, simply because the burden of bad loans at large. It is no disgrace. Shameful, is that Spain calls for rules other than Ireland. As to the Emerald Isle a half years ago burst the speculative bubble in housing prices had halved and the country assistance in, complained the Irishman, but rather fit courageously to their economic structures and accepted the obvious, namely that they are responsible for their debts. The Spaniards, however, want to pay the costs of their collective speculation of others."
(Google Translate)


"Auch wenn es an diesem Wochenende noch nicht so weit zu sein scheint, so dürfte Spanien früher oder später doch einen Antrag auf Hilfe stellen, einfach weil die Last der faulen Kredite zu groß ist. Das ist keine Schande. Beschämend aber ist, dass Spanien für sich andere Regeln als für Irland fordert. Als auf der grünen Insel vor anderthalb Jahren die Spekulationsblase platzte, sich die Hauspreise halbierten und das Land Hilfe in Anspruch nehmen musste, klagten die Iren nicht, sondern passten beherzt ihre Wirtschaftsstrukturen an und akzeptierten das Selbstverständliche, dass nämlich sie für ihre Schulden verantwortlich sind. Die Spanier hingegen möchten die Kosten für ihre kollektive Spekulation von anderen begleichen lassen."

Dirk Gently

that's not so much sticking up for us as trying to put the boot into Spain. If he was sticking up for us he'd be calling for us to get the same terms as Spain, not Spain getting our terms. I say good luck to Spain if they can manage to isolate banks from the sovereign.

Solair

Yeah, but the issue is that if we can't decouple the banks from the sovereign we're basically screwed for decades.

Admittedly, it was the last government's policies that seemed to be based around an idea that we should throw every last bit of the country's cash, assets and credit rating down the gaping hell hole that was Anglo Irish Bank and the other extreme cases.

AIB, BOI, PTSB etc should have been restructured and only consumer banking / viable aspects of business banking rescued i.e. the bits we *Actually* need, rather than the giant property speculation funds.

Anglo & the other 'specialist lenders' were just a property speculation fund really.

Dirk Gently

Solair wrote: »

Yeah, but the issue is that if we can't decouple the banks from the sovereign we're basically screwed for decades.

Admittedly, it was the last government's policies that seemed to be based around an idea that we should throw every last bit of the country's cash, assets and credit rating down the gaping hell hole that was Anglo Irish Bank and the other extreme cases.

AIB, BOI, PTSB etc should have been restructured and only consumer banking aspects rescued.

Anglo & the other 'specialist lenders' were just a property speculation fund really.

What's that got to do with Spain though. We exploded first and we acted first and we needed a bailout first. Spain have had a few years to study our course and rightly they now want to avoid doing an Ireland. No need for them to shoot themselves in the foot in solidarity with us.

It's not spains fault we rolled over so easily.

stackerman

Next up Italy :rolleyes:

The priority for the Irish government should be to work out an emergency plan ( ahead of the event this time :mad:) and have it in the back pocket. Not being rushed ONCE AGAIN into a decision which puts the tax payer at the bottom of the Pyramid. Europe can't carry all the debt, without masive printing, which will destroy the €.
Sooner or later ALL the Euro debt (including French and German) will land on the table, and there is no answer to that amount of debt.

The Americans are now wetting themselves, as they know that they are next up, once the Euro pans out. American debt levels are even worse.

Germany talking of payment of debt via national stocks of gold
Bank of international settlements upgrading gold to tier 1 status
Aisa buying masive amounts of same
And yet the Governments tell us it's all in hand :eek:, and your fiat is safe !

I'll make up my own mind thanks

Dotsie~tmp

el más barato rescate de la historia..

amandstu

stackerman wrote: »

The Americans are now wetting themselves, as they know that they are next up, once the Euro pans out. American debt levels are even worse.

Am I wrong but I thought that the US economy was more or less free to borrow whatever it liked ?The rest of the world's economies had to keep in step with whatever policies the US followed.

Could the US really be in trouble regarding its deficit? Can't it just devalue its way out of trouble any time it chooses ?

Isn't the dollar the "gold standard" for the world?

stackerman

amandstu wrote: »

Isn't the dollar the "gold standard" for the world?

Not for much longer I'd say. Would you want to trade in a currency that is being constantly debased ?
Would you consider it a good "store of your wealth" ?

That is why (IMHO) Aisa, and China mainly, are purchasing so much in the way of commodities. They are dumping their dollars because they see the writing on the wall. Gold, silver, land, resources etc etc. Just look at Africa.

Yes the US can just print dollars, and they will.
As one Jim Sinclair says "QE to infinity is as sure as death and taxes". There is currently a rush to the dollar, and the average person on the street sees it as a safe haven. But it is not, just have a look at the real inflation and unemployment figures. They will have no option but to print away (before the election if you ask me) and in so doing will put the final nail in their coffin !

Just my honest opinion :rolleyes:

amandstu

stackerman wrote: »

Not for much longer I'd say. Would you want to trade in a currency that is being constantly debased ?
Would you consider it a good "store of your wealth" ?

Well if you are at all right what would follow the dollar?
Anything at all? Do we need a reference currency?

stackerman

amandstu wrote: »

Well if you are at all right what would follow the dollar?
Anything at all? Do we need a reference currency?

Now only if I knew that , I'd soon be a very rich man.

Check this interview out Steve Keen is spot on, again IMHO.

https://s3.amazonaws.com/cm-us-standard/audio/steve-keen-2012-06-08.mp3

Go to 31 min for prediction, if your your too lazy to listen through (should listen to it all though).

Elvis_Presley

makes for some grim listening.lets hope he is very wrong, whatever about economies crashing, that's one thing, a return to facist governments is a whole different story.

kennyb3

http://www.bloomberg.com/quote/GSPG10YR:IND

Rally already finished.

This buying time is getting more expensive per conference call/summit.

darkman2

Spanish PM was talking complete rubbish.


http://www.rte.ie/news/2012/0611/euro-soars-after-spain-bank-bailout.html


They will have the strings attached that everyone has.

Solair

Well, he did try his best to avoid p***ing off the entire Spanish nation.

1) Fudge announcement and make it sound less harsh than it actually was.
2) Announce it on the day that Spain's playing a major European cup match.

I was talking to some Spanish friends of mine earlier and they are very annoyed. It's that same feeling that we all had when the three ministers were lined up saying "no the IMF are not coming" when AJ Chopra was shopping in Grafton Street.

It's the old : "No, that's not the Troika, they are just some people from the IMF, European Commission and ECB here on holiday"... trick.

antoobrien

darkman2 wrote: »

Spanish PM was talking complete rubbish.


http://www.rte.ie/news/2012/0611/euro-soars-after-spain-bank-bailout.html


They will have the strings attached that everyone has.

Interesting to see that (apart from 2 year bonds) the active Irish bonds are down between 1% & 3.8%

The bit that worries me is the 2 year bond (6.43%) because these (€8bn) come due in 2014, after we come out of the troika funding. If we want to get an idea of what the markets beieve we are doing and how the other deals affect us, these and the 3 year bonds (€4bn) are the ones to watch.

kennyb3

http://www.zerohedge.com/news/spanish-cds-storms-above-600bps

Wow, they didnt even buy a day this time.

kennyb3

Full blown bailout time now

http://www.rte.ie/news/2012/0614/spains-borrowing-costs-hit-euro-era-record-of-7.html

Solair

Looks like Ireland all over again.

I lived in Spain and something really doesn't add up about their economy.

Wages were significantly lower than Ireland, yet in the North at least, the costs of living, especially rent, were at least as high as Ireland at the peak of the boom.

I still think that there will be enormous losses revealed in the cajas.

Sand

Best thing that Spain could do now is revoke the "bailout". Let their banks fail if that is their fate. Like ourselves, the Spanish have enough problems to deal with in terms unemployment and economic/fiscal reform. Their ability to borrow will be drastically improved if they demonstrate a real ability to tackle their own problems, whilst also drawing a clear line between themselves and the woes of European banks which happen to be resident in Spain.