Rajoy Calls For Euro Zone Fiscal Integration

On Saturday, Spain's prime minister Mariano Rajoy Asked For a Eurozone Fiscal Authority, in effect the "Fiscal Nannyzone" that I have spoke of on numerous occasions.

In case there was any doubt that the European circus could get any more ridiculous, here comes Spain's uber-unpopular Prime Minister Mariano Rajoy, already embroiled in a massive kickback political scandal, with a quote that just blows everyone away: "I repeat what I said Saturday: everything that has been said about me and my colleagues in the party is untrue, except for some things that have been published by some media outlets." And scene as your frontal lobe explodes.

I am piecing together a story of fraud and corruption involving the highest levels of Spanish government. My unnamed sources think it could bring down Prime Minister Mariano Rajoy. However, the news articles I have (primarily in Spanish) are particularly choppy. The brief background story is "black money" (under the table fraud or bribes) was paid monthly to top Partido Popular (PP) party leaders.

In the wake of Bankia bailouts to the tune of €19 billion, the second bailout in two weeks, yields of Spanish debt are soaring. Spread to German Bonds Hits 5.05 Percentage Points

Rajoy Denies Receiving "Undeclared" Money After waiting for days to make a statement, prime minister Mariano Rajoy stepped up to the plate with a fuzzy denial on Saturday following an emergency meeting of the Popular Party’s executive committee. "This is all false. I'm not in politics for money. I have never received undeclared money" said Rajoy. Questions Abound

Spain's prime minister, Mariano Rajoy, has finally admitted three things I have been saying for a long time Spain's regions were in deep fiscal trouble if not bankrupt Spain could not possibly hit its deficit targets for 2012 It is mathematically impossible for Spain to meet deficit goals without raising taxes, no matter how much he insisted otherwise.