Market gains wiped out as Spanish banking giants Santander and BBVA hit with credit rating downgrade
Relief on the financial markets that a massive bailout had been agreed for Spanish banks dissipated today as investors fretted over the details and a ratings agency hit two of Spain's banking giants with a downgrade. Fitch also downgraded its rating on Santander UK.
http://www.dailymail.co.uk/money/index.html
~Pyrate~
"Those who make peaceful revolution impossible will make violent revolution inevitable.
John F. Kennedy
Again-can't post the entire story...but we are seeing the "fast and furious" starting on the bailout requests.
BY ALKMAN GRANITSAS
ATHENS—Cyprus said Monday that it urgently needed European financial aid to boost its banks' capital, a step that would make it the fifth euro-zone economy to seek help from the region's bailout funds.
Cyprus Finance Minister Vassos Shiarly said the country's need for an international bailout was "exceptionally urgent" in order for it to recapitalize its banks, and that the issue would need to be resolved by the end of the month.
According to several European officials, the size of any bailout would be unlikely to exceed €3 billion to €4 billion ($3.8 billion to $5 billion), a sum that ...
http://online.wsj.com/article/SB1000...NewsCollection
~Pyrate~
"Those who make peaceful revolution impossible will make violent revolution inevitable.
John F. Kennedy
...
a sum that wouldn't strain the resources of the euro zone's bailout funds. The economy of Cyprus—an island of 800,000 people—is one-sixtieth the size of the economy of Spain, which said over the weekend that it would seek European funds to recapitalize its own banks.
However, some European officials said the main impact of Cyprus's request might be to send a further signal that contagion is spreading in the euro zone. Greece, Ireland and Portugal are all in bailout programs.
Officials said Cyprus's government would probably seek funds along the model for loans to Spain, under which conditions will be placed on the country's banking sector but no new impositions will be placed on the way it manages its economy.
Cypriot banks—particularly the nation's second-largest lender, Cyprus Popular Bank—need to rebuild capital after suffering losses in the Greek government-debt restructuring earlier this year.
Mr. Shiarly said no request for aid had been made, but said: "We have never ruled out the possibility that we will apply to the [bailout] mechanism for support. The mechanism is one of our choices."
The European Commission said it had received no indication of any aid request. "We know that the Cypriot banking sector...is under heavy pressure; we are monitoring that," said Amadeu Altafaj-Tardio, a commission spokesman.
He said there was no plan for Cyprus to ask for aid before Sunday's election in Greece, which officials have worried could spark turmoil in Europe's financial markets. Nonetheless, "if something needs to be done we have the instruments in place and ready to use," he said.
Last month, the Cypriot Parliament approved a plan to support Cyprus Popular Bank after the bank wrote down some €2 billion from the Greek restructuring.
A rights issue of new shares, which will be underwritten by the government, is set to start Friday and last about two weeks. With private investors unlikely to cover anywhere near the full sum, the plan creates potential liabilities of €1.8 billion for the state—equivalent to a tenth of Cyprus's annual economic output.
"The issue is urgent. We know that the recapitalization of the banks must be completed by June 30," Mr. Shiarly, the finance minister, said. "Until June 30 there remain only a few days left, and so as a result the issue is exceptionally urgent."
Cyprus secured a €2.5 billion loan agreement from Russia last year that staved off the immediate need for a bailout. The government had been exploring whether it could seek Chinese or further Russian funding but these options now seem unlikely, Cypriot and EU officials said.
The likely request for European aid comes against the backdrop of a weakening economy. Growth turned negative in the last two quarters of 2011 after a blast at a munitions dump in July knocked out half the country's energy supply. The latest quarterly figures for gross domestic product released last week show that the recession is deepening.
To close the budget gap, the government is expected shortly to announce a new package of austerity measures, which is expected to further deepen the downturn.
Thanks again, GW
I'm confused...
Cyprus secured a €2.5 billion loan agreement from Russia last year that staved off the immediate need for a bailout
Russia? ?
why does that not give me a warm fuzzy feeling??
~Pyrate~
"Those who make peaceful revolution impossible will make violent revolution inevitable.
John F. Kennedy
Somebody pleaase explain to me how adding more debt to banks/countries that cant pay the debt they already have solves anything
~Pyrate~
"Those who make peaceful revolution impossible will make violent revolution inevitable.
John F. Kennedy
It is too late, for words... Resist. Or Submit.
___Resistor_____/VVVVVV\__
A progression of Lies, Disinormation and Obfuscations:
A "bold new world" and "forces too powerful"
http://tinyurl.com/o49lbyx
An agregious post #24: Some Clear Thinking On 'The Debt'
http://tinyurl.com/oqjvf3g
More : Tax reform: restoring ... free market system.
http://tinyurl.com/qgejpdl
Christoph Pauly and Christoph Schult, writing in Der Spiegel
Listening closely to Chancellor Angela Merkel in recent weeks has revealed just such a change in tone. It has been a careful shift, extremely nuanced. But it has become clear that her well-known melody is now a new one.
"We need a so-called fiscal union," she said during an appearance on German public broadcaster ARD last week. "Which means more joint budgetary policy." Up to that point, Merkel had merely repeated that which she always demanded. But then came the new tone: "More than anything, we need a political union," she said. "That means that we must, step by step through the process, give up more powers to Europe as well and allow Europe oversight possibilities."
Merkel is carefully preparing the public for the possibility that great changes are coming and that established certainties are no longer valid. Her message is that Europe only has a future when the Germans too give up large portions of their national sovereignty. That is the extent of her message, but it is plenty nonetheless.
~Pyrate~
"Those who make peaceful revolution impossible will make violent revolution inevitable.
John F. Kennedy