88% Of Traders Expect A Spanish 'Bailout' By Year-End

Tyler Durden's picture

With the front-end of the Spanish (and Italian) credit spread curves having compressed to what Goldman believes is 'fair-value' given rates and current fundamentals, it seems the consensus expectation ahead of tomorrow's ECB call is that Draghi will promise, deliver, and implement instantaneously. In a recent client survey a stunning 88% of investors expect Spain to officially request activation of EFSF/ESM support - subject to an MoU - by the end of the year (with 70% expecting it by the end of October - the heavy redemption month). A full 50% expect the Italians to follow suit by the end of Q1 2013. The paradox of course is that with the spread cost of funding so 'low', Spain has no need to ask for the help that is implicitly priced into the low yields - and with that huge maturity looming, it seems they have two options: 1) pre-empt the redemption by issuing short-dated debt now to fund it (piggy-backing on the ECB's confidence inspiration) but of course this will signal no need for a short-term MoU and therefore no ECB support and therefore bonds will sell-off; or 2) admit defeat, beg for help, lose face and get the bailout... (as we await tomorrow's 'details' on the seniority issue). The promise (or threat) of support implies it has to get worse before it can get better.

Goldman Sachs: Italy/Spain fair-value spread curves...

Front-end is now back to 'fair'...


When do you expect Spain to formally ask for the activation of EFSF/ESM support, subject to a Memorandum of Understanding?


When do you expect Italy to formally ask for the activation of EFSF/ESM support, subject to a Memorandum of Understanding?


Source: Goldman Sachs

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surf0766's picture

Please keep Greece in until after the election

Dalago's picture

The system is made to fail.

slewie the pi-rat's picture

 <--< YES

 <--< NO

slewie opinion poll:  should US Mint-produced gold and silver coinage be restored as LEGAL TENDER in the US as per the US Constitution and not subject to the fuking "collectibles" and OTHER TAXES?

yes or no? VOTE!

...please...  L0L!!!

Dalago's picture

There will be a power grab like nonez of youz seen before.   Power grab, bitchezzzzzz!

LawsofPhysics's picture

I agree, who has the majority of the gold again?  Long brass and lead personally.

smiler03's picture

In other news, 12% of Traders are found to have CJD (Human variant Mad cow Disease).

Pancho Villa's picture

US gov should simply remove tax on PM exchanges. That is the main impediment to using them for transactions right now.

If gold and silver are made legal tender, the gov would need to acquire them which could lead to confiscation.

PrintingPress's picture

You're living in the wrong state ;)

buzzsaw99's picture

when the bernank goes unconventional he will buy eurotrash

Deep79's picture

Oh so Goldman is right on this call, but when ZH sees fit, Goldman is always wrong?

I wonder if this is a Goldman run site



magpie's picture

Goldman can still prove its 1.27 Euro call right

disabledvet's picture

I agree. Yet again "not in congruence with the facts." when in doubt "bow down to your (former) Goldman overlords."

NotApplicable's picture

WTF, is today fucking Derp Day or something?

Go back and READ the post, okay?

Now look closely. GS didn't "make a call" they published a client survey.

At least in the old days, when people bashed ZH, it was over differences of opinion. These days though, it's all failure to comprehend what is being said.

As always, this shit ain't that hard.

Wm the Shrubber's picture

Whatever happens, just - for the love of God - make sure that the spin is positive for equity markets!  Markets simply can not EVER go down!

Cognitive Dissonance's picture

"88% Of Traders Expect A Spanish 'Bailout' By Year-End"

And 4 out of 5 dentists recommend Crest.

It looks to me like that trade is listing a bit too far towards starboard. Everyone move to the other side............NOW!

<I just love it when the Muppets still act like Muppets even when they know they are Muppets.>

Dr Benway's picture

Haha I was just going to post a similar comment, about 75% of dentist recommending brushing twice a day. I mean I always wondered about the remaining 25%, what are they, some kind of renegade dentists that just say "ah screw it never mind brushing"

walküre's picture

What is a trader and how many are left to give any relevance to what 88% of them might think?

Traders are going the way of Tin Men

SheepDog-One's picture

Anyone bother to wonder WHO has the MONEY to bail out Spain? Or is that just irrelevant to the issue of 'how many traders expect a bailout'?

Element's picture

wot? you dare suggest the safety net ... isn't?

That the allocation ... isn't? ... it's all good in theory but the pledges don't cut it when the shit actually hits the fan?

Yeah ... OK, ... I can see that ...

Everybodys All American's picture

Cone on...  Did anyone actually ask the HFT algorithm?

Vincent Vega's picture

Not yet. That's why I fully expect Bloomberg to run an article tomorrow titled: 12% of Traders Expect No Spanish Bailout. The algo's will go full retard.

Debtonation's picture

When is this shit going to go full fledged crisis mode? The anticipation is just killing me.

NotApplicable's picture

They will manage it down to the last millisecond, as each one transfers more wealth from the weak hands.

ArrestBobRubin's picture

From whom? With what?

Ergo: QE to Infinity

Peter K's picture

Just in case we start having a naming contest for the new ECB program, I want to get my entry in first. I would name the new program S.O.S., or Son of SMP. Catchy, ain't it. :)

BeetleBailey's picture

<--Bullish for the EUR

<--Bearish for the EUR

PontifexMaximus's picture

If 88% of TRADERS expect a Spanish bailout, then it is already now a nobrainer, move on!

Xibalba's picture

What is a Traders?  And where can you find one? 

Dick Darlington's picture

It never stops amazing what a colossal failure the political utopia called euro has been. In a decade the unelected and other fanatics have brought the continent to the brink. I seriously question the mental health of all €-believers. Wake the f*ck up!

smiler03's picture

The Euro is merely a subset of the EU and the EU merely a subset of the World.


In my opinion we're all in this fucked up mess together. Do you think the other continents will be OK? 

q99x2's picture

Let me know when the twilight zone is over. The Dow has been at 13,000 since February. Its been a long ride.

bdc63's picture

I kid you not ... Maria Barfaroma just asked Santelli what "sterilized" means ...

And "Next up on CNBC, Kim Kardashian joins us on the NYSE!" ...

I knew it was bad, but SERIOUSLY?! ... We are so fucking doomed.

ptoemmes's picture

My wife would probably kill me if I made a Tampon joke about now.

LawsofPhysics's picture

How many of them are human?

lolmao500's picture

They better do it fast or else this kind of stuff will get nastier...


Breakdown: Three Tons of Food Looted From Grocery Stores In Spain As Millions Struggle

Social safety nets across the continent are visibly under stress and breaking down, so much so that unemployed Spaniards have begun raiding supermarkets in order to put food on the table. As recently as last month the people of Cadiz and Sevilla, which have a reported unemployment rate of 32%, joined together to loot local grocery stores of three tons of food - some of which was distributed to local food banks:

Haager's picture

It will get nastier, that's how tactics are designed for some contries. It's kind of sad for some, but it's necessary to feed the fat...

smiler03's picture



Spanish Owner calling Police "My supermarket has been looted!".

Police "What was looted?".

Spanish Owner calling Police "About 293 Kilos".

"That's the shocking news from your on the scene media attention grabbing journalist.".

edit: I've researched this story more and it seems that a Trade Union and mass daylight "theft" was the story. I'm guessing that they had vehicles capable of carrying three tonnes of food available.

lolmao500's picture

3 tons aint much... A few cars could carry that.

Poetic injustice's picture

And tonight I understood I read too much Zerohedge. I had a nightmare, where user named Minsky was proving Minsky theorem in 10 lenghty posts, and proving how bad it is now.

NEOSERF's picture

And what is completely ridiculous in our upside down world is that this "event" will be looked at as positive, will lower bond rates and cause the Spanish markets to go through the roof.  Reality is that Germany has given them a bigger bucket to bail and is telling them to bail faster.  This whole thing has a Titanic feel about it but the last year has been sitting on the deck watching as ever so slowly the ship begins to list to the side. There just doesn't seem to be that "shock and awe" moment that is regarded as truly negative.  Everything bad is somehow a entree into more free money.  Riots and war will be the only thing that really tells this stock market that things are not in control and really bad...

Clowns on Acid's picture
EU Says Greeks Should Work Six-Day Week: Report

Why should  2 guys have to work 6 days a week, while eevryone else just picks up their checks ?

Anglo Hondo's picture

Spain officially ask for a bailout?  Nope.


Spain:  "Draghi, give us the money, no conditions,  or The Eurozone Gets It."


What will the ECB do?  What can they do?  Spain has them over a barrel.


GrinandBearit's picture

Do algobots count as "traders"?

Ned Zeppelin's picture

Tomorrow's Mario event will be epic in all respects; we'll have on Bloomberg Surveillance " a celebratory tape at the historic announcement," bright chartreuse green across all screens, much high fiving and raising of glasses - "Gentlemen, our long nightmare is over. We give you: The Epson to End All Epsons, the Super Duper Mario Edition Epson.  We will print, gentlemen, and we will print a sh*tload." 

It seems that there will be no end to this, it will just go on and on and on and on. . . . .

Yardfarmer's picture

and on the streets three tons of food is looted from supermarkets and people are feeding out of garbage bins. http://chasvoice.blogspot.com/2012/09/breakdown-three-tons-of-food-loote...

monad's picture

These are the SCYTL people Soros will be paying to count the US election votes in November.