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Spanish Banks Petition To Convert Historical Losses Into Bank Capital
In what has to be the most insane level of desperation, the Spanish banking system is lobbying to turn its deferred tax 'assets' into fungible capital to meet new stricter Basel III requirements. In other words, the Spanish banks believe that capitalizing historical losses provides a fungible 'stash' of capital against future losses... Following this morning's round of incredulity from the Spaniards, we have no words...
Via Reuters,
Spanish banks are lobbying the government to turn more than two thirds of their 50 billion euros ($65 billion) in deferred tax assets into state-backed tax credits that would boost their capital but add to the state's debt, three banking sources said.
The so-called deferred tax assets (DTAs) are created when a bank makes losses or writedowns that it can offset against future tax bills when it returns to profit.
Under stricter Basel III rules on capital, being phased in as of January 2014, most forms of DTAs will no longer be allowed to count towards capital, while tax credits will be.
Spanish banks are asking the government to convert between 15 billion and 30 billion euros of their DTAs into tax credits, the banking sources said.
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Debt is wealth. Black is white. Pizza is a vegetable.
i like to pizza part ... can eat it forever and ever breakfast, lunch and dinner ... healthy food all it takes in advertisement right??? an idea for the Cain "pizza" El Presidente.
i suppose... at least i hope ...
http://www.youtube.com/watch?v=pxf5QwExt9Q
Exactly
Another ponzi is born!
How do you say, "when piigs fly" in spanish?
And how is this different from the unicorn farts and creative accounting they have been using for capital?
@Florida
wenn Schweine fliegen - Kraut
quando los cerdos vuelan - Spanish, more or less;)
Because now creative accounting is one thing and has it's limits, this is pure fraud.
I mean, I also want to turn my taxes I plan to pay for next year, turn them into assets and use to buy whatever I like.
It's called a tax refund loan, but you have to pay it back, not write it down, take a tax credit, then use it to borrow more money next year. if you could, I'd be all over that. :)
I will pay it back, of course. 1 dollar/year should be fair.
Actually, Pizza is vegetable doesn't belong, as it is a far more accurate and – ahem – palatable statement than the other two.
i like your thinking :)
Wait...is this a Friday humor post? This isn't really....I mean...ummmm...what now?
Pizza is a vegetable buddy, the ingredients are all plants! I put it right up there by the butterfinger food group, on the now retired food pyramid or is it hidden in page 2864 of Michell's new food group that is starving, starving the school children of the villages, I forget, my brain must be clogged up today after that, um good, tripple meat, double crust last nite.
WTF indeed
Haven't these unfortunate bankers suffered enough? /sarc
GREATEST. IDEA. EVER.
Good to see Europeans are as adept at ignoring their own laws and regulations as we are. There will be high-fives in Davos this year for sure over this one.
I can't believe they were ever considered an "asset." Then Basel III says they can't be counted as an asset (makes sense to me). Then the banks come in and ask the Spanish government to sprinkle them with magic pixie dust and.... TA DA!.... they're an asset again!
This is like watching a 3rd grader play checkers. Every time they make a bad move, they just change the rules.
Calvinball FTW!
pods
Kicking the can through a wormhole
bankruptcy bitchez!
Not yet, they still have more pixie dust.
Kill them before they destroy even more of society.
how much longer can these fuckers hold out until gold gets recognized as money for banks balance sheets?
Gold is money for the banks balance sheets. Never has left the sheets. It's all the legal "paper" their political hores legislated that is keeping the scam going.
Never knew that Spanish banksters studied at Harvard.
i can has debtburger
They got the idea from Biden... 'have to spend money to save from going bankrupt'........
just multiply it by (-1) and everything is alright.
turns every debt into maximum gains.
over the next months: have fun bailing out spain. this pig is much harder to swallow than greece.
Now I know why absoute value was so important during high school. No need to multiply by -1, just put all your numbers like this |X| and it will balance just fine.
First Video: Snowden in Moscow Statement:
http://homment.com/Snowden-video-moscow
I want to buy an office building in town here. Since I need a loan to do it, I suppose I could now talk the bank into letting me claim the unpaid portion of my private mortgage is an asset. I have a feeling this is really going to work out fantastic!
It's creative thinking that is needed to save the world!
Don't forget to claim as asset your lottery tickets (each of them could potentially win millions!).
Can I do the same with my trades?
"I am using my past crimes to be used to forgive my future crimes as it becomes necessary", said EVERY FUCKING BANK.
"most forms of DTAs will no longer be allowed to count towards capital"
So have been counting losses as capital for a long time and they are moaning they can't do it after 2014?????????????
WTF, no wonder this is a f"cked up farce,
So much pious comment! Is there one among you who would not do the same to protect your privledged position in society, your job, your country club account, your children's BMW's, your wife's luxury villa, furniture, jewelry, hairdo's, fancy shoes? And what of the yacht? And the pedigreed dogs and horses? Cone on? So you have no morals, and representative democracy is a joke. So what is the big deal? It's you against me and mine, andwhy should I give up - ever - change the rules - so what? Move on?
I haven't, wouldn't, won't. Not pious or better than anybody else, just raised different.
I wouldn't.
I also wouldn't steal stuff from your garage, even if it were easy.
No, it is not you and yours against me and mine. Life is not a zero-sum game.
Olay!
Anything is worth a try when you're on the verge of systemic collapse! Way to think outside of the box, convert a negative into a positive, so optimistic!
Will somebody hit the fucking panic button already!
So what is the problem with that?
GS sold worthless morgages as investment grade securities.
It is amazing that just by moving a worthless debt to a different column, it becomes an asset.
LONG taxes on deferred derivatives losses baby!
So if I go into a bank to apply for a loan and list all my financial failures as assets, will the bank now look favorable upon me? I thought this shit only works at Pedro's Used Car Autobonanzo!
BTW, that was hypothetical - I have no need nor intent to borrow money. Ever.
They have you right were they want. Finance everthing then pay back with worthless dollars, if you believe!
They'll want their AAA towels back soon...
Wow, I had no idea that Spain was run by Mooninites.
In retrospect, it makes sense.
http://www.youtube.com/watch?v=6szaAEzyFoU
Can I do that with my recent gold and silver loses? Crickets... At least I know my metal will appreciate in price. Spains deferred taxes will only increase as their POS assets vaporize in value.
No debt left behind........
Being a CPA who is well versed on DTAs, it took me a minute to realize what they wanted. But, then I read the article and realized it. They want a % of ALL OF THERE LOSSES to be paid for by the state. That is it. They want the DTA to become a tax credit. I assume a refundable one. If it is not refundable then it would not make a difference from what they already have from a tax perspective.
This means they want a bail out based on their tax losses! I would guess that, if approved, 99.9999999% of the population will not understand what is happening.
Next up, Spain wants to use all assets marked as SQRT(-1) as capital...oh wait that is already a reality here in the USSA.
What kinda crap is this, more lies? I'm thinking they really don't wanna do that. Maybe they would, but do they really care if they can't?
They just want to "act" like they're trying real hard to come up with any kind of crazy plan to stay alive OTHER than ripping off all depositors by stealing 100% of their accounts. Then when the gubment says "No" (the good cop/bad cop routine), the banks will just HAVE to Cyprus the shit out of every account they can lay their hands on. Capital controls to ensue. yadda yadda yadda.
Why anybody would leave any amount of their own fiat in a bank anywhere in the world is so fucking beyond me at this point. I haven't left extra cash in my bank for over 4 years now! Only what's needed to get by for the bills and that's fucking it...bare fucking minimum. All payday fiat gets immediately extracted via ATM in piles of 20's as soon as it hits my account every 2 weeks.
Then most is immediately converted into nice shiny silver phyzz!
Keep stackin' folks...it's only gonna get worse before it ever gets even the slightest bit of better.
Mark my words, governments will see this as a new taxing (theft) opportunity.
California will say, "hey, you have $1mil. in Federal tax losses, I'll take 10% fuck you very much." Feds will do the same.
I would bet that there already is a spread sheet somewhere in these Subjugated States estimating "revenue" from such a scheme.
The underlying assumption being that at some time in the future there would be profits made and subject to taxes which in turn could be offset by these losses......but what if there were never any profits?
What they should do is create a market in which companies can sell their losses to the highest bidder who is permitted to employ these losses as a tax offset. This would provide needed capital to the losers while simultaneously reducing the amount of cash going to governments, which is always a good thing....make a win / win out of a loser / loser.
I like the way you think, rosie:)
Less money to the state treasury is just what the doctor ordered for Spain. For all govies for that matter...:))))))
Jeez, I thought I read it wrong the first time. So I took a deep breath and read it again. Yup, that's what it really said - really. Just trying to figure out how to do this at home. . . . .
We have gotten used to financial madness but this one actually made me laugh out loud.
You just know this isn't going to end well. :)
Hey these millions of American foreclosures aren't non-performing, they're ASSETS, durh. As long as they're not sold at a loss all is well right???
The música is still playing so keep them butts off the sillas and continue hadas de la tierra