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The Dirty Little Secret About the Spanish "Bailout"

Phoenix Capital Research's picture




 

 

Spain’s Bailout is one big lie.

 

I know, I know... Spain is “saved” thanks to a €100 billion bailout.

 

But no one is asking just where this money will come from?

 

The IMF isn't involved. Nor is the ECB.

 

The EFSF, which can’t even raise €10 billion without having to step in to insure it doesn’t have a failed bond auction isn’t a possibility (Germany doesn’t want it).

 

That leaves just the European Stability Mechanism (ESM)... except for the little known fact that only FOUR of the necessary 17 EU members have ratified legislation to even CREATE the ESM.

 

That's right... the ESM doesn't even EXIST yet.

 

On top of this, Spain and Italy make up 30% of the ESM's supposed “funding.” That’s right, nearly one third of the mega-bailout fund’s capital will come from countries that are bankrupt themselves and are either already requesting bailouts (Spain) or soon will be (Italy).

 

Finally, and this is the REAL problem with the ESM… Germany hasn't OK'd it yet.

In fact, German opposition leaders have stated point blank that hoping for Germany to ratify the ESM before its due date (July 1) is “completely unrealistic.”

 

So... Spain is going to be bailed out by a non-existent entity whose leading member likely won't even have ratified its formation... before July 1.

 

Sure things could play out differently. But wasn’t Spain literally on the verge of a systemic Crisis? And we’re talking about weeks… possibly months before it gets a single Euro in bailout funds (assuming the funds even show up at all).

 

So I ask again... WHERE is the money going to come from? It doesn't exist. The whole Bailout is one big lie. The funds simply are not there.

 

Even if they were, €100 billion is NOTHING compared to the REAL capital needs of Spanish banks. Heck, Bankia alone needs €24 billion… and that’s just ONE BANK out of Spain’s €3 trillion banking system.

 

Folks, if you think we’re out of the storm yet in Europe, you’re in for a very VERY rude surprise. It’s quite likely the EU won’t even exist in its current form before the summer ends.

 

The simple reason… THERE AREN’T ANY FUNDS LEFT TO PROP UP the €46 TRILLION toxic sewer that is the EU banking system. End of story.

 

On that note, if you’re not preparing for the collapse of the EU’s banking system, you need to do so now. I recently published a report showing investors how to prepare for this. It’s called How to Play the Collapse of the European Banking System and it explains exactly how the coming Crisis will unfold as well as which investment (both direct and backdoor) you can make to profit from it.

 

This report is 100% FREE. You can pick up a copy today at: http://www.gainspainscapital.com

 

Good Investing!

 

Graham Summers

 

PS. We also feature numerous other reports ALL devoted to helping you protect yourself, your portfolio, and your loved ones from the Second Round of the Great Crisis. Whether it’s a US Debt Default, runaway inflation, or even food shortages and bank holidays, our reports cover how to get through these situations safely and profitably.

 

And ALL of this is available for FREE under the OUR FREE REPORTS tab at: http://www.gainspainscapital.com

 

 

 

 

 

 

 

 

 

 

 

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Tue, 06/12/2012 - 20:00 | 2519919 Zero Govt
Zero Govt's picture

"That's right... the ESM doesn't even EXIST yet."

Graham, get with the program... the EU as you know is in total LaLa Land, just go with the flow/fantasy, no point at such a late stage of senility to try to introduce reality into this Euro Project

Tue, 06/12/2012 - 16:33 | 2519427 blackbeardz
blackbeardz's picture

the pain in spain is about to go insane. treasury bills go to auction on the 19th & bonds on the 21st

\there are no good economic numbers coming from anywhere in the world, every market will fall.

Farmland, food commodities, are about to become the new bubbles, give it a year.

 

Tue, 06/12/2012 - 16:23 | 2519385 disabledvet
disabledvet's picture

I thought every nation had a euro printing press. Just hit "control p" in espanol and "rock and roll" brother! (and no I don't have any connection to The Zone. But if you pay me a lot I might. Debts not being repaid? Contracts abrogated? Need to spring your pet banker from prison? I'm your guy. Of course "past performance is not a guarantee of future results" is our motto so "hedge accordingly."

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