The head of Austria's central bank, Ewald Nowotny, and German finance minister Wolfgang Schaeuble have both made statements over this weekend that affect bailout options for Spain.
In particular, Nowotny says Spain must seek help before ECB buys bonds.
Spain would have to apply for a rescue package before qualifying for inclusion in the European Central Bank's plan to buy debt of struggling euro zone members, ECB policymaker Ewald Nowotny said.
LONDON — Cyprus’ bailout deal is the fifth agreed on so far in the 17-strong group of European Union countries that use the euro since the debt crisis began in late 2009.
Here’s a look at the rescue programs:
Germany’s commissioner to the European Union says he expects a future aid package for Greece to amount to a little more than 10 billion euros (US$13.36 billion) — which is much smaller than the country’s existing two rescue deals.
Guenther Oettinger, the EU’s energy commissioner and a member of Chancellor Angela Merkel’s ruling conservative party, said Saturday the third aid package should cover the years 2014-2016.
In response to Spain Needs to Debate Leaving the Euro; Tooth Fairy Economics I received a nice email from Michael Pettis confirming my translation was correct. He also attached the original article in English.Michael Writes ...Thank's Mish. I am attaching the original, but the translations you got were basically right and covered the main points, which you understand anyway.
I seriously do not understand this "Bad Bank" concept. The idea that you can take bad assets and shift them off to the side and it will make things better seems ludicrous.If for some reason you disagree, please note that Spain now needs a "Bad Bank" for "Bad Banks". They call this proposal "Midas N + 1".
Ukraine package of funding from the IMF and other lenders remains still largely unspecified, but it is worth recapping what we do know and what we don't.Total package is USD40 billion. Of which, USD17.5 billion will come from the IMF and USD22.5 billion will come from the EU. The US seemed to have avoided being drawn into the financial singularity they helped (directly or not) to create.
Yields on 30-year and 5-year bonds in Spain hit a euro-era record on Friday as the Valencia region of Spain filed for financial assistance.
Bloomberg reports Spain Bonds Slide as Valencia Aid Request Deepens Crisis
If the leaders of the European Union cannot agree soon to some sort of 'master plan' that saves Greece, shields Spain and Italy from the contagion of wholesale investor selling, protects France from a fatal downgrade, avoids failure for the world's largest banks, and persuades German voters not to dump its government ... all hell will break loose in Europe, the UK, USA, etc. Portugal, Ireland, Italy, Greece, and Spain are more than 3.1 trillion Euros in debt. France — which, according to Moody's, is now in danger of suffering a fatal downgrade of its debt — owes another 1.6 trillion.
By Simon Johnson
Most experienced watchers of the eurozone are expecting another serious crisis to break out in early 2011. This projected crisis is tied to the rollover funding needs of weaker eurozone governments, i.e., debts falling due in March through May, and therefore seems much more predictable than what happened to Greece or Ireland in 2010. The investment bankers who fell over themselves to lend to these countries on the way up, now lead the way in talking up the prospects for a serious crisis.