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Caja Madrid To Ask For €3 Billion In Government Support
Earlier we reported that Caja Madrid was put on downgrade review by S&P, following Friday's puke fest on all things Spanish by Fitch. The rating agencies may have gotten it right for once: MarketWatch reports that according to a report, Caja Madrid "will tap the government for €3 billion in rescue funds." That CajaSur "New Century" domino, as we predicted, is starting to really set in.
More from MarketWatch on the collapsing Spanish depository and banking sector:
Up until a couple of weeks ago, the term "caja", which literally means box or chest, was not such a familiar term with global investors, but many are now getting a crash course as news is rapidly spilling out from the sector.
Spain has 45 savings banks and an increasing number are now in merger talks -- ailing from the collapse of the housing market -- amid some estimates that the country has 30% more bank branches than it needs.
Pressure to merge and restructure has come from the International Monetary Fund and the Spanish government.
The government has set up a Fund for Orderly Bank Restructuring, or FROB, to speed along this process, and given the savings banks until June 30 to ask for the money they need.
The fund has a total value of €99 billion and is funded with €9 billion of capital and up to €90 billion of government-backed debt.
Look for any temporary strength in the US stock market better known as the EURJPY cross to fizzle as fresh concerns about Spain, and Italy, whose CDS hit a record level earlier, once again become dominant.
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And right on cue the EURO and Dow explode - UP!
euro is still red. I don't know any news that can actually stop this downward spiral.
Another QE? BOOM DOWN
Do Nothing? BOOM DOWN
My long postions are bleeding like pigs here...
Madrid actually still has a lot of gold in their churches from the spanish conquests!
STRIP THEM BABY!
Indexes
The 10am candle.... Time for lunch
ROR
Dude, dont you find it ridiculous how all the majors are experiencing the same rising pattern. Its absolutely absurd.
Amazing what an in-line, as expected piece of data can do to offset all the wonderful macro problems in the world.
My, there sure are a lot of bullish indicators out today. All we need now is a major default of some kind, and we can cross 11k.
ruh roh
I guess credit enhancement in those CDOs and CDO2 doesn't work when the entity [Spain] backing them is facing a potential death spiral regarding its credit rating. Buying those shitty gov. CDOs to help the same government mask its debt was not a smart idea.
Also, it would be interesting to see how many of those shitty repackaged construction loans are there on Cajas balance sheets in the form of CDO, CLO and are those also enhanced by Spain backing them.
To the marketwatch "crash coursed" translator: "Caja" has more to do with "cashier" or "cash register" than with "box".
Spain is the laundry machine of Europe. Almost every 500 euro bill is in circulation in Spain because those are easy to transport.
That money flow has dryd up already 2 years now, so no official measure can rescue Spain right now.
Real estate didn't only overheat, it Melted and evaporated!
And rest assured that the rest of Europe is watching the money laundry close by because they need everything they can get their hands on to tax, making it useless to invest in Spain anymore.
And still the 500's are refered to "Osamas" in Spain, as no ordinary people have ever seen one.
FROB! HAHA!
I propose that anyone wanting to trade this market should be forced to sign a copy of this mornings EUR/USD chart.
1.21 is made of Fed FLUBBER.
How's the STUPIDS chart looking?
CASA DEGLI ZOMBIES:
http://williambanzai7.blogspot.com/2010/06/casa-degle-zombies.html
The symbol/"mascot" of the city of Madrid is a bear. It's on many logos around the city.