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Aurora
Joined: 24 Jan 2007
Posts: 8501
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 Posted: Fri May 25, 2012 10:29 pm Post subject: Spain Watch, and Catalan independance |
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| Quote: | The Guardian - 25/05/12
The first steps in a major restructuring of Spain's fragile banking sector were put in place on Friday night as the board of Bankia � Spain's fourth biggest bank � asked the country's government for a rescue cash injection of �19bn (�15bn).
With Spanish banks now seen as a serious threat to the euro, taxpayers are likely to end up with 90% of the deeply troubled lender.
The new bailout � taxpayers already own 45% of Bankia � is expected to be just the first part of a growing bill for cleaning up a banking sector that has been refinancing loans on toxic real estate and comes amid signs that regions within Spain are unable to take the strain. The regional government of Catalonia called for financial help from the central government.
Article continues ... |
| Quote: | Another worry is the Spanish sovereign debt now piling up at the country's banks, as a circular support system evolves in which banks lend money to the state and the state borrows money to bail out banks.
Spanish banks held �146bn of national debt in April, or 30% of the total, up from 13% a year ago. |
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UndercoverElephant
Joined: 10 Mar 2008
Posts: 11110
Location: south east England
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| Posted: Fri May 25, 2012 11:54 pm Post subject: |
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While everybody has been talking about putting firewalls round Greece to stop contagion spreading to other countries, it turns out that the Spanish banking system is already completely busted, Greece or no Greece. Which just puts even more pressure on the people trying to keep Greece "on board."
https://mninews.deutsche-boerse.com/index.php/euroview-capital-fleeing-entire-periphery-not-just-greece?q=content/euroview-capital-fleeing-entire-periphery-not-just-greece
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PARIS (MNI) - The start of a bank run in Greece has captured the headlines, but it may be the run by foreign investors on the entire periphery that poses the biggest challenge to the Eurozone.
While less visible than a rush by Greeks to withdraw their passbook savings, a move by non-residents to pull deposits and dump government bonds in countries like Italy and Spain is gathering pace, according to official data and analyst reports.
In Italy, foreign investors reduced their holdings of government bonds by nearly E100 billon, or 12%, in the second half of last year. In Spain, non-residents dumped E37 billion, or 14%, of their government bonds between November and February. And by some accounts the pullback has accelerated as LTRO money has made domestic banks big buyers and foreigners even bigger sellers.
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Little John
Joined: 08 Mar 2008
Posts: 8306
Location: UK
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| Posted: Sat May 26, 2012 12:25 am Post subject: |
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| UndercoverElephant wrote: | While everybody has been talking about putting firewalls round Greece to stop contagion spreading to other countries, it turns out that the Spanish banking system is already completely busted, Greece or no Greece. Which just puts even more pressure on the people trying to keep Greece "on board."
https://mninews.deutsche-boerse.com/index.php/euroview-capital-fleeing-entire-periphery-not-just-greece?q=content/euroview-capital-fleeing-entire-periphery-not-just-greece
| Quote: |
PARIS (MNI) - The start of a bank run in Greece has captured the headlines, but it may be the run by foreign investors on the entire periphery that poses the biggest challenge to the Eurozone.
While less visible than a rush by Greeks to withdraw their passbook savings, a move by non-residents to pull deposits and dump government bonds in countries like Italy and Spain is gathering pace, according to official data and analyst reports.
In Italy, foreign investors reduced their holdings of government bonds by nearly E100 billon, or 12%, in the second half of last year. In Spain, non-residents dumped E37 billion, or 14%, of their government bonds between November and February. And by some accounts the pullback has accelerated as LTRO money has made domestic banks big buyers and foreigners even bigger sellers.
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Yep
If/when Spain goes down then the fireworks really start. Which is, I guess, what all the fuss with Greece is about. An attempt to draw a line in the sand at Greece is all about keeping a lid on things while there is still some point. Everything I have read about Spain tells me that if the lid comes off Spain's economy, it's game over. |
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Aurora
Joined: 24 Jan 2007
Posts: 8501
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| Posted: Sat May 26, 2012 7:32 am Post subject: |
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| Quote: | The Independent - 26/05/12
Spain races to bail out bank as debt fears stalk Europe
Article continues ... |
| Quote: | | Last night, in another blow to the embattled nation, the Standard and Poor's ratings agency downgraded the credit ratings of five Spanish lenders including Bankia, which, along with Banco Popular Español and Bankinter, was cut to junk. |
| Quote: | Struggling banks: A Europe-wide problem
Spain
The dependence of Spanish banks on the ECB for funding has ballooned in the past year, rising from €43.8bn (£35.1bn) in April 2011 to a mammoth €316.9bn last month.
Italy
Moody's has cut its ratings on 26 of Italy's biggest banks as its economy faces a third quarter of recession and austerity measures.
France
In Paris, the big concern is the exposure of French lenders to peripheral eurozone nations – $491.4bn (£313.6bn) to Italy, Spain and Greece as of the end of 2011, according to the Bank for International Settlements.
Portugal
Following last year's bailout, Portugal's banks are still largely frozen out of money markets and borrowed €55.4bn from the ECB in April.
Scandinavia
Though stronger, banks in Sweden and Norway suffered credit ratings cuts yesterday, partly owing to the European debt crisis. |
Here's another interesting little graphic compiled by the BBC in November 2011:
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woodburner
Joined: 06 Apr 2009
Posts: 4128
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| Posted: Sat May 26, 2012 8:43 am Post subject: |
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| Quote: | Eurozone debt web: Who owes what to whom?
Article continues |
What a dreadful graphic. It's near impossible to make out the arrows unless you start adjusting display settings. |
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Aurora
Joined: 24 Jan 2007
Posts: 8501
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| Posted: Sat May 26, 2012 9:40 am Post subject: |
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| woodburner wrote: | | Quote: | Eurozone debt web: Who owes what to whom?
Article continues |
What a dreadful graphic. It's near impossible to make out the arrows unless you start adjusting display settings. |
Works fine on my PC.  |
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Totally_Baffled
Joined: 24 Nov 2005
Posts: 2824
Location: Hampshire
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| Posted: Sat May 26, 2012 10:12 am Post subject: |
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Aurora
Might as well get a thread set up for every European country lol Suggest this order:
Portugal Watch....
Ireland Watch...
Italy Watch...
Netherlands Watch..
France Watch...
UK watch...
Germany Watch...
Mushroom cloud watch...(ok maybe this a little pessimistic lol )
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TB
Peak oil? ahhh smeg.....  |
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Lord Beria3
Joined: 25 Feb 2009
Posts: 5061
Location: Moscow Russia
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| Posted: Sat May 26, 2012 10:24 am Post subject: |
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http://www.financialsense.com/financial-sense-newshour/guest-expert/2012/05/25/louis-vincent-gave/greece-likely-to-exit-the-euro
| Quote: | | CEO at GaveKal Research in Hong Kong. Louis believes that Greece will ultimately exit the Euro, and the ECB will then ease massively to stem the tide of bank runs in other at-risk European countries. He sees opportunities in US blue chip stocks. |
You might be interested in this interview. One 'solution' to the crisis, at least for a few years, would be massive printing money from the ECB.
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Peace always has been and always will be an intermittent flash of light in a dark history of warfare, violence, and destruction |
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Aurora
Joined: 24 Jan 2007
Posts: 8501
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| Posted: Sat May 26, 2012 10:29 am Post subject: |
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| Totally_Baffled wrote: | Aurora
Might as well get a thread set up for every European country lol Suggest this order:
Portugal Watch....
Ireland Watch...
Italy Watch...
Netherlands Watch..
France Watch...
UK watch...
Germany Watch...
Mushroom cloud watch...(ok maybe this a little pessimistic lol ) |
HeHe  |
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UndercoverElephant
Joined: 10 Mar 2008
Posts: 11110
Location: south east England
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| Posted: Sat May 26, 2012 11:01 am Post subject: |
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| Lord Beria3 wrote: | http://www.financialsense.com/financial-sense-newshour/guest-expert/2012/05/25/louis-vincent-gave/greece-likely-to-exit-the-euro
| Quote: | | CEO at GaveKal Research in Hong Kong. Louis believes that Greece will ultimately exit the Euro, and the ECB will then ease massively to stem the tide of bank runs in other at-risk European countries. He sees opportunities in US blue chip stocks. |
You might be interested in this interview. One 'solution' to the crisis, at least for a few years, would be massive printing money from the ECB. |
Have you been asleep for the last six months? Yes, the obvious "solution" to the eurocrisis would be massive money-printing from the ECB, but the reason the eurocrisis is the biggest financial crisis in any of our lifetimes is because this has turned out to be politically impossible for Germany.
The Germans remember what happened last time they subjected their currency to massive money-printing: catastrophic hyperinflation. The Germans are also very much aware how much it cost to absorb the old East Germany into a unified state, and that's why it is also politically impossible for them to accept they have to repeat the process with the whole of the rest of the eurozone.
The eurozone crisis is primarily political, not economic. That's why the world is focused on them right now, rather than the places which have even worse debt problems (Japan, the UK and the US.) |
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Lord Beria3
Joined: 25 Feb 2009
Posts: 5061
Location: Moscow Russia
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| Posted: Sat May 26, 2012 11:05 am Post subject: |
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I was merely saying that if the Germans ultimately accept ECB printing money as a lesser evil to a disorderly collapse of the eurozone and its banking systems, then yes, down the road, we will see high/hyperinflation at some point.
However, from the perspective of the EU elite, bent on keeping the Project going (until growth returns? ha ha!) then this is one big kick of the can down the road, if ECB do ultimately print money big time.
Personally, i advocate a orderly dismantling of the euro but then that is merely my opinion.
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Peace always has been and always will be an intermittent flash of light in a dark history of warfare, violence, and destruction |
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SleeperService
Joined: 02 May 2011
Posts: 1104
Location: Nottingham UK
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| Posted: Sat May 26, 2012 2:49 pm Post subject: |
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Coming from Hong Kong Louis should read his local history books before spouting such drivel.
Hong kong is touted by the Free Marketeers as the shining temple of what they can achieve. IMHO it's cobblers. Hong Kong benefited from some far sighted people in the 60s who got the government out of areas it shouldn't be in in peacetime. The savings were then used on infrastructure improvements.
Once these were done personal taxation was lowered progressively with companies taking the lions share of the tax burden. I can't remember the name of the guy who set it all up but his bust is everywhere in Hong Kong as a reminder.
In fact totally the opposite of what free marketeers want in Europe. But then there was some social responsibility in HK and the Mont Pelerin crowd have the social response of a dog caught short on a croquet lawn. See the post elsewhere about Chicago for example.
I wish I could pull the name up though, I think he was a Scot 
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Scarcity is the new black |
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Tarrel
Joined: 29 Nov 2011
Posts: 2451
Location: Ross-shire, Scotland
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| Posted: Sat May 26, 2012 5:02 pm Post subject: |
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| The name you're looking for is John Cowperthwaite and yes, he was from Scotland. |
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SleeperService
Joined: 02 May 2011
Posts: 1104
Location: Nottingham UK
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| Posted: Sat May 26, 2012 5:27 pm Post subject: |
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Thanks for that Tarrel I've been going through my notes and books in between tearing my hair out since posting. I had his name when I started typing...then I didn't 
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Scarcity is the new black |
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UndercoverElephant
Joined: 10 Mar 2008
Posts: 11110
Location: south east England
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| Posted: Sat May 26, 2012 9:09 pm Post subject: |
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http://www.nytimes.com/2012/05/25/business/global/in-spain-bank-transfers-reflect-broader-fears.html?_r=3&hp
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And clearly, some consumers are now picking up on the warning signals. Mr. de la Peña, the civil servant in Madrid, said that he had recently transferred 80,000 euros, essentially his life savings, from Ibercaja, one of Spain’s savings banks, to Santander.
But now, with daily news reports on the prospect of Greece’s possible departure from the euro currency union, he is seriously considering converting his nest egg to British pounds.
“I’m exasperated because the situation changes every day,” he said. “But what is certain is that if Greece now leaves, it’s going to be one huge and bloody chaos.”
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