Posted on 05/31/2012 5:41:32 PM PDT by bruinbirdman
Spain is facing the gravest danger since the end of the Franco dictatorship as the country is frozen out of global capital markets and slides towards an epic showdown with Europe.
“We’re in a situation of total emergency, the worst crisis we have ever lived through” said ex-premier Felipe Gonzalez, the country’s elder statesman.
The warning came as the yields on Spanish 10-year bonds spiked to 6.7pc, pushing the “risk premium” over German Bunds to a post-euro high of 540 basis points. The IBEX index of stocks in Madrid fell 2.6pc, the lowest since the dotcom bust in 2003.
Chaos over the €23.5bn rescue of crippled lender Bankia has led to the abrupt resignation of central bank governor Miguel Ángel Fernández Ordóñez, who testified to the senate that he had been muzzled to avoid enflaming events as confidence in the country drains away.
Markets are on tenterhooks as Spanish yields test levels that forced the European Central Bank to respond last November with its €1 trillion liquidity blitz. “Nobody is short Spanish debt right now because they are expecting ECB intervention,” said Andrew Roberts, credit chief at RBS. “If it doesn’t come -- if we take out 6.8pc -- we’re going to see a hyberbolic sell-off,” he said.
Italy felt the full brunt of contagion from Spain on Wednesday, with 10-year yileds back near 6pc. The euro fell to a 2-year low of $1.239 against the dollar. Crude oil and metal prices plummeted
(Excerpt) Read more at telegraph.co.uk ...
Bush’s fault. Or perhaps Spain has too many ATM machines.
my dtr and her hubby have a trip booked to Spain this Sept......ugh..
There should be bargains galore.
These emergency, disaster, catastrophe headlines have been filling up a column on Drudge for the last month. Yet nothing has so far happened. Greece hasn’t left the EU, Spain hasn’t defaulted, the govts have not been ousted by rifle fire. I don’t know what’s going to happen, but these headlines have ceased to be created from substance.
I liked Benidorm a lot.
I lived though the years of double digit bond rates in the 80’s so 6.7% doesn’t really sound catastrophic to me.
But then thinking about it inflation was double digits then too so the real rate wasn’t that high.
I’m sort of thinking about this as I type. I see Eurozone inflation in May was 2.5% so real interest rates in Spain are just around 4%. Is that reason to panic?
It’s just that denial, kicking the can down the road, printing paper, using neologisms to obscure true circumstances, can go an amazingly long way to forestall the inevitable.
Barometer=oil
Bailout=higher oil and commodities passed to the ponzi ducks.
Fortunately we took our Spain trip a year ago. Now we have the world’s greatest set of “Before” pictures.
I have another set of Before pictures: my visit to New Orleans in July, 2005.
Fortunately we took our Spain trip a year ago. Now we have the world’s greatest set of “Before” pictures.
I have another set of Before pictures: my visit to New Orleans in July, 2005.
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Please tell me where you are taking your next trip so I can cash out...LOL
Entire countries would pay you NOT to show up!
Obama’s fault.
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