Frankfurter Allgemeine Zeitung Reports EU, IMF Prepare To Bail Out Spain; Europe Denies

Tyler Durden's picture

A potentially destabilizing report appeared earlier today in the Frankfurter Allgemeine Zeitung (FAZ), according to which countries in the EU are preparing to bail out Spain, which has immediately prompted denials out of both the EU Commission, which claimed that the "report on aid for Spain is completely untrue." Of course, in January Joaquin Almunia almost ate that Bloomberg reporter who, for the first time ever, suggested that the EU would need to bail out Greece. Four months later Greece was bankrupt and the EU was on hook for a cool trillion. And in adding to the ongoing contradictions, Spain's Treasury Secretary has said Spain has no problem financing its debt, even as it was reported that Spanish banks have raised a record €85.6 billion in ECB funding, and Spain's Ocana understated that the "liquidity freeze in Spain in foreign markets is a problem." On the other hand, of course Spain has no problem in "financing" its debt - the ECB is gladly monetizing it all. Lastly, the fact that Spanish unions have called for a general strike is likely going to shift the balance of power to the truth instead of the baseless propaganda, and within a week or so, Spain will be another raging Greece.

More from the FAZ:

The countries of the European Union are preparing to Spain to help with loans out of its deepening financial and debt crisis. "We will lead in the upcoming talks this week in Brussels," it said on Sunday in government circles in Berlin. "We will move under the treaty and the economic reason." Obviously, has exacerbated the situation so that States not to want to wait for the EU summit on Thursday. I understand that includes both the head of the EU Commission and the European Central Bank (ECB) support is not enough.

A spokesman for the Ministry in Madrid on Friday still had denied an interest of the Spanish government of Jose Luis Rodriguez Zapatero: "There is no bailout." They have not sought help, and that would not do so. Similar statements, however, it was announced in spring in Greece before the Athens government, the EU partners but then asked for help.

Responsible for the escalation is apparently the situation in the Spanish banking market. There are currently rolls a wave of consolidation. The institutes are trying to get through mergers, the impact of the housing crisis under control. Nevertheless, confidence has fallen sharply, lending in the interbank market falters for days. ECB President Jean-Claude Trichet spoke of "continuing tensions in some segments of the financial market." If the problems escalate, Spain could get the first country funds from the aid package of 750 billion euros, the countries of the Euro Zone and the International Monetary Fund (IMF) recently agreed.

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HelluvaEngineer's picture

Disclosure: long FAZ

lizzy36's picture

hope your are long KY for this mornings action.

Xibalba's picture

so this is what the Bilderbergs were up to?

Hdawg's picture

They need to give the market impression that the $1trillion bailout of Europe will be the last until it is fully written into law.

Once they have everyone on the hook they'll bring out the Spanish wreckage.


LeBalance's picture

Arrrr...thar be the famed wreckage of the Spanish Galleon...

The mighty Squidee took 'er down to Davey Jones many a year ago.

We shall feast greatly on her carcass as we show her limp form to all and ask that they bring her to the surface.  They always fall for the "rescue" con as the moneys will never be for Spain, but only for our fees.  Spain will just be raised in illusion financial space, but the real Spain will just be left in the murky depths, so that we can double and triple dip on the "rescue" con sale.

Arrrr, being the pirate is sooo wonderful as it we have refined it to be reward without risk.  Arrrr, me hopes they don't find out that we have tentacles under our captain's jacket.

ratava's picture

who cares, risk on

Cognitive Dissonance's picture

Everyone has decided to follow the advice of the young bald boy with the spoon in The Matrix.

"Of course, it's impossible to overcome the mountains of bad private and governmental debt. Instead, consider that there is no debt."

George the baby crusher's picture

As the Euro slowly rides off into the sunset.

LeBalance's picture

Waaa Waaa Waaa!

But first the WAR!

"Never have I seen so many men used so badly." - Blondie, The "Good"

plocequ1's picture

What ever works.. Dow 36,000  Google 19,000  Apple 16,000

yabs's picture

nothing like the smell of a sovereign debt crisis

in the morning to pump those stock markets higher

LeBalance's picture

"you know one day this war is going to end."

A condition that will NEVER again be allowed to happen.

"War on foreign soil is used to deprive freedoms from the folks on home front." - Unknown

papaswamp's picture

Dow to 10,500 based on growth 'hopes'....and expects Asia to continue to lead the world out of recession.

"St. Louis Fed President James Bullard, speaking in Tokyo, said Monday that he expects an Asian-led world economic recovery to continue, and also said he didn't see evidence of a Chinese bubble."

plocequ1's picture

That all depends on which pump software the Fed is running. I think they are running the Pumpomatic brand 36,000 edition.  Dow 36,000. Guaranted to pump the market regardless of .. Pesky shorts, Volcanoes, Hurricanes, Pesky Euro issues, Wars and Tylers commentaries or your money back

Hdawg's picture

It's paifully obvious that there is absolutely no way out of this fiat clusterfuck.

Anyone who can't recognise that this will crescendo into the collapse after the November elections need their heads examining.

Sean7k's picture

Unfortunately, people will bear almost anything rather than deal with change. As long as all fiat systems are failing, people will "hope" for a coming stability. Especially if their leaders tell them it's coming.

I always thought the bell curve couldn't always be right, but it is the best predictor of behavior I have ever seen. The knowledgeable are the 3%. 

jbc77's picture

Ya know, I'm starting to believe the masters of manipulation will be able to pull this off. Until they don't I suppose.

Worst print on retail in 8 months post jobs number meltdown and we gun the markets. This whole thing is just one big mess.....but they keep gunning.

I don't think the masters can let the markets unravel. They fear people in the streets and a rising market really helps quell some of that.


yabs's picture


I have the same frutsration but I am sure one day it will fail

I'm surprised its lasted so long but I thi nk the day is close now, its hanging by a piece of string

whopper's picture



Yup,,and they should be fearfull. amazing they can keep this POS together. 

Racer's picture

I have given up trading this broken market but this misleading of the sheeple is nothing new...

Ramesses II misled his sheeple when he said that he overcame the Hittites and that he valiantly fought against them virtually single handed.

Instead of the reality that it was a massive bloodbath and a draw!

thisandthat's picture

So, this is a new report, or the one from last week or so?

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