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And Another Spanish Bond Long
As the selling stampede takes the Spanish bond complex by storm, here is another bond to hedge the shorts with, this time not a regional one, but an outright Spanish MTN. Note that the presence of the negative pledge at the sovereign level means that first Finland, and soon everyone else will demand a security interest the second the ESM loan is activated.
From THE KINGDOM OF SPAIN, €8,000,000,000 Euro Medium Term Note Programme
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English law bond means Spain CAN'T DEFAULT (if they don't want to be sued) on it right?
Seems somehow ironic that it was the Finns that invented the Molotov Cocktail.
Not true. Incendiaries were used during the Spanish civil years before the Finns gave them the now infamous moniker.
But... THEIR Molotov was destined for use on Molotov, the Kremlin gremlin, whence its name in their eyes. Whereas the russian Molotov brewers stole their copyright and used it for the fellas from Aryana uber alles land.
Cola Cola would not have liked that at all!
Strict answer: If they fail to pay on time, or do anything else that constitutes an 'Event of Default', you take your evidence to an English court and ask for a formal court declaration that they are in default.
Armed with that, you can do all sorts of interesting things, like forcing the sale of any Spanish assets held under English jurisdiction, or any other jurisdiction with which England has enforcement agreements.
Personally, I would start with the Spanish embassy building in London - most foreign embassys are situated in rather expensive areas...
Up to a point, Lord Copper. If the proportion of English-law debt stays small enough then likely foreign sovereigns will just repay it in full to avoid the lawsuits in England. But if sovereign creditors and debtors all pile into the English-law lifeboats then the sovereign-debt crisis could eventually replicate itself as an English-law-sovereign-debt crisis. The UK has a parliament too, and a limited desire to piss off all its neighbours too badly.
English law bond just means that the Queen has paycheques guaranteed for all eternity.
It's the UK and their banking cabal who fucked up the entire financial system.
Bailouts come with fees. Good for The City.
If you look really really fast.....Bullshit looks like Bullish!!
Spain had to accept subordination, the same way that Greece did.
http://confoundedinterest.wordpress.com/2012/06/11/spains-bank-bailout-fizzles-italy-now-in-the-bailout-cross-hairs/
I wonder if China will demand subordination for any further lending to the Grecian States of America?
No. They could have just taken their medicine and scrubbed the wound clean.
Sorry. I just couldn't say that with a straight face. :>)
We are buying every bond that ZH recommends. And we are shorting the rest.
How about Italian, French and German english law bonds. As things unravel best be ahead of the game.
I wonder why the price of gold is flat ? Usually on Mondays around this time it is down at least 20$ an ounce.
Patience O'whopper.....down $10 now ;)
Cheers!
@spotgoldprice
It's as if they are saying "dear Mr. banker, please create enough money out of thin air so that you can own our governments"
And broadening patterns are showing up on the charts again. Ominous.
Where's the story on the "Italian bank declaring a holiday"?
got a link that you can share?
google "bni bank italy"
What's holly about that?
http://ncrenegade.com/editorial/bank-holiday-reported-in-italy/
Its not on BBC, so it didnt happen.
Actually it was a bank failure. Orderly. We have 2-3 here in the US every Friday.
So orderly that people still have their paycheques deposited into that bank and tried to take out money from their accounts or make payments with their charge cards over the weekend?
What would a disorderly failure look like?
Bottom line is that WE/YOU are always the last to know and that is what has people on edge.
US Markets don't realize that everything is fine now....
Back to the middle ages, serf, peasents and over Lords apparently.
When Spain has to come forward and "guarantee" Italian bonds can we officially say the farce is over? I mean come on boys and girls. They just applied the dreaded "English" Law? Oh My God. But maybe they did not see Spain had it's fingers crossed under the table?
BEHIND CLOSED DOORS:- SHORT US FINANCIALS, BUY GOLD AS SMART MISSES MERKEL IS CONSIDERING BACKING UP SHORT-TERM ONLY EURO BONDS BUT WITH A CATCH, YES EVERY SINGLE EU MEMBER (THOSE WHO HAVE IT OF COURSE) TO PLEDGE ITS GOLD AS COLLATERAL IN THE EVENT OF FURTHER ECONOMIC DETERIORATION OR FAILING TO STICK TO THE GERMAN RULES....SOUNDS LIKE A GOLD STANDARD TO ME UNDERWAY...
Please stop shouting. WE CAN HEAR YOU!
Ted Ms. Merkel has been pushing for this over a year now. Soverigns do not want to give up their gold. The crisis is not big enough yet. We need more people starving first. Of course the USA may just declare an emergency and confiscate all the gold stored here and the president can do that.
Long morning delay in next article. Tyler(s) must be busily following their own advice.
Drudge report has picked up the story of a bank in italy having a bank holliday.
Corporate media is NOT running the story for a reason.
But the news is spreading like wildfire in Europe.
BANK RUN
The pigmen running the stock market changed the rules when the shorts looked to destroy them The pigmen are changing the rules in the bond markets so the short and the CDS's don't destory them. All the while they transfer more debt to the citizen and give themselves hefty bonus! That my children is the sad truth of this market.
Shit hit the fan over the weekend, folks. YOU would be the last to know. Asian investors bought the pump. European investors did NOT buy the pump and SOLD into the rally. As always, buyers beware.
Spain doesn't want to disclose the ugly truth. That is the story. They announced 40 billion and got 125 billion thrown right back at them. Huh? Then the propaganda attempt that "Spain is not Uganda" and all the other conflicting PR over the weekend. They couldn't even agree who would cover the billions as none such vehicle exists.
BANK RUN continues.
it seems as if alot of alternative websites have picked up the story of bni bank in italy having themselves a little siesta (holiday) but its not on any mainstream media.
yes now that makes alot more sense. thank you
i guess italy doesnt have an fdic. the link from drudge takes you to a translation to an italian newspaper article about it. They make it sound like customers of the bank are totally locked out of their accounts.
according to Tylers it's "orderly" LOL
CONfidence is on the chopping block
So .. we went from ES +20 overnight to a flat S&P and going likely negative during the day.
Now that's encouraging to buy the dip or be priced out f4eva!
For a boots on the ground view, some people who PEACEFULLY protested this bailout on Sunday at Puerta del Sol had their identity cards taken by the police :((( Where are we going here in Europe???
but are the treuFinns pirates?
stay tooned...
Does this kind of sovereign bond exists under Swiss Law? I know about a slowakian one, but i'm looking for a Spain or Italy one.
Main advantage: it is in CHF too.
Unfortunately not much of the Spanish foreign law bonds trade. The Catalan bonds actually trade wider same as Portugal's UK law bonds. Market is pretty fast and illiquid so paying a pretty penny for the bid/ask. At the end of the day, if Europe blows up, I don't think anyone will care if you have UK, foreign, or Mars law bonds. The payment on the Greek 450mn UK law bonds was a unique situation. With a weak government struggling to negotiate a deal with Europe, I think they just didn't want to deal with the UK law issue. Not sure it will happen again.