Spain Agrees To "Unconditonal" Bank Bailout

Tyler Durden's picture


Just out from Bloomberg:


And the funniest:


So Spain has shockingly agreed to a bank bailout without conditions. Has Germany? The chips will commence falling, where they may, shortly. In the meantime, we are days from finding out just what Germany thinks when it has to ratify (that's right, the ESM has still not been ratified by the one country which will fund the Spanish bailout) the direct rescue of the Spanish banks. Without conditions.

From El Pais:

All ready to rescue the fourth largest economy in the eurozone. Ministers of Economy and Finance of the euro area have concluded a few minutes of the meeting by teleconference 19.00 convened to decide on the future of Spain and, according to AFP, it was agreed that the Government seek the rescue, which will be IMF involvement. The agenda of the meeting, as previously reported in European officials left no doubt: "The approval of a statement that highlights Spain's intention to seek help and support of the Euro". In fact, according to these same community sources during the meeting that has lasted nearly three hours, and figures have been considered a rescue that could reach 100,000 million euros, an amount which is well above what had speculated. However, the stakes ensure that clean once and for all Spanish banks, first, to restore confidence in Spain after and bring stability to the entire euro area, immersed in its worst crisis since the launch the euro.


Spanish Economy Minister Luis de Guindos, has called on the media in the Ministry of Economy at 19.30, which indicates that it has come to some agreement. The purpose of it, detailing the department, is to explain "the results of the Eurogroup meeting" and "actions on the recapitalization of the Spanish financial system."


"The figure we are discussing now would be up to 100 000 million, but not yet closed "and is a cap, have stated the sources consulted by AFP. Reuters also agrees with these figures, more than double that manages the IMF, estimated at 40,000 million injection needed for Spanish banks . The managing director of this institution, France Christine Lagarde, is also participating in the teleconference.


The final amount, however, probably will not be known today and will be implemented once they know the results of two independent audits commissioned by the Spanish government. Thus, the figure will be decided "according to the results of needs analysis" of Spanish banks. In this respect, the Euro is expected to meet again in the near future to confirm the figure, while EU sources indicate that although the request for assistance is made this weekend, which is as safe, they add, the Government can wait a few days to provide a specific figure. At the end of the process, will the ECB and the European Commission have to quantify the aid will reach the Spanish banks.

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Sat, 06/09/2012 - 13:24 | 2510369 deagle44
deagle44's picture

Where are you seeing this is without conditions?

Sat, 06/09/2012 - 13:24 | 2510371 MeanReversion
MeanReversion's picture

This is going to give Syriza a boost.  Watch out.

Sat, 06/09/2012 - 13:25 | 2510373 adyaner
adyaner's picture

Unconditional loan?? what could possibly go wrong? maybe the southern germany colony will have issues with this...

Sat, 06/09/2012 - 13:29 | 2510388 hugovanderbubble
hugovanderbubble's picture

Germany and Netherlands will vote NO.

Sat, 06/09/2012 - 13:37 | 2510413 MeanReversion
MeanReversion's picture

Many backbenchers in Germany's parliament were already unhappy with the ESM, this isn't going to help.

Sat, 06/09/2012 - 14:06 | 2510506 dearth vader
dearth vader's picture

Don't count on the Netherlands to vote NO. There's a two third majority of euromaniacs in the national parliament, at the moment. New elections, set for September 12th, can make a difference, but not beyond the 50% treshold in my estimation. People are so utterly clueless about the real issues.

Sat, 06/09/2012 - 13:29 | 2510374 hugovanderbubble
hugovanderbubble's picture

Grupo Prisa = El país...=will be in DEFAULT ,well currently they are, entire group.

dont listen to that media, they are desperated to crash Right Axis government when Super Rodriguez Zapatero has destroyed any possibility of recovery last couple years.

Socialists = CANCER

the problem is Right Axis doesnt have the clue to take off,cos honestly its impossible with out debt haircuts...

Sat, 06/09/2012 - 13:42 | 2510432 magpie
magpie's picture

Isn't Soros pitching in with his El Pais venture ? 

Sat, 06/09/2012 - 13:26 | 2510375 fbrothers
fbrothers's picture

That's great, I was on pins and needles. Thank goodness Spain will take some money from anyone. Whew!!

Sat, 06/09/2012 - 13:27 | 2510378 strangeglove
strangeglove's picture

Ill agree to a bailout too! Will this affect my SNAP card?

Sat, 06/09/2012 - 13:27 | 2510380 Imminent Collapse
Imminent Collapse's picture

No more reign in Spain.

Sat, 06/09/2012 - 13:28 | 2510383 russwinter
russwinter's picture

Sort of sounds like the IMF has been sucked in for funding, translate the US. If the US is going on the line for European banking bailouts, what does that do to the Treasury market, and USD, let alone the political reaction? 

Sat, 06/09/2012 - 13:30 | 2510391 MeanReversion
MeanReversion's picture

The IMF can't lend without conditions.

Sat, 06/09/2012 - 13:44 | 2510437 disabledvet
disabledvet's picture

which is why "without conditions" is important...if true of course.

Sat, 06/09/2012 - 13:58 | 2510487 MeanReversion
MeanReversion's picture

Looks like the IMF's role will be limited to supervision, they won't be doing the lending.

Sat, 06/09/2012 - 14:03 | 2510500 russwinter
russwinter's picture

 I wonder because the American stooge posse, including Obama were out in force last week. Smells like they are getting involved to placate the Germans. 

Sat, 06/09/2012 - 17:43 | 2511015 sablya
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Officials said there had been a heated debate over the International Monetary Fund's role in Spain's bank rescue, which Madrid wanted kept to a minimum. It will not provide any of the money.

Sat, 06/09/2012 - 15:35 | 2510766 icanhasbailout
icanhasbailout's picture


Sat, 06/09/2012 - 17:22 | 2510982 Matt
Matt's picture

Sure there is, it's called a "Dine and Dash". Alternatively, you can get someone else to pay for it. Either way, from the perspective of the one doing the eating, it is free.

Sat, 06/09/2012 - 15:38 | 2510772 FlyoverCountryS...
FlyoverCountrySchmuck's picture

Sure it can, if the election of THE MESSIAH, the "WON!" is in danger.

What? You didn't think Obama gave the Euros the key to the Treasury last week, when Summers was in Europe?

That EPIC-FAIL speech was to set up the Sheeple for another bailout of the Big Banks and Europe, both at the same time, along with a call for more "Stimulus" (pork for his voters).

After all, the Private Sector is doing just fine, it's GOVERNMENT that's really hurting!!

Sat, 06/09/2012 - 14:34 | 2510583 DosZap
DosZap's picture

, what does that do to the Treasury market, and USD, let alone the political reaction? 

Not one damn thing.

Sat, 06/09/2012 - 13:29 | 2510387 piceridu
piceridu's picture

"The chips will commence falling, where they may, shortly. In the meantime, we are days from finding out just what Germany thinks when it has to ratify (that's right, the ESM has still not been ratified by the one country which will fund the Spanish bailout) a Spanish bank bailout. Without conditions."

      I'll believe it if by Monday morning, Ronaldo and Messi are wearing Bayern Munich jerseys...

Sat, 06/09/2012 - 13:29 | 2510390 Dick Darlington
Dick Darlington's picture

100 bn unconditional TAX PAYER money for BANKS, TAX PAYERS from OTHER countries. Uh huh, EUSSR sure has gone turbo speed in it's way to collision with a brick wall.

Sat, 06/09/2012 - 13:44 | 2510440 Tirpitz
Tirpitz's picture

But that's understandable. Banks are systemically relevant, after all, while tax payers are expendable.

Sun, 06/10/2012 - 00:51 | 2511593 FreeNewEnergy
FreeNewEnergy's picture

I want my money back.

Sat, 06/09/2012 - 13:30 | 2510392 stant
stant's picture

whew! we americans have 6 more months to piss our money away. or find some way to keep it

Sat, 06/09/2012 - 13:31 | 2510396 sockratte
sockratte's picture

unconditional? so what does this mean for greece election? ;-)

Sat, 06/09/2012 - 13:36 | 2510409 Mongo
Mongo's picture

It means "Fuck you Europe but thanks for the fish"

Sat, 06/09/2012 - 13:34 | 2510401 strongband
strongband's picture

100,000 million sounds less than 100billion too. Dust off the saddle, bring out the unicorn - it's time to navigate the candy fields! Buy buy buy!

Sat, 06/09/2012 - 13:32 | 2510402 Rich Bagg
Rich Bagg's picture

Prepare for massive short cover rally.  Dow up 500 on Monday.  LOL

Sat, 06/09/2012 - 13:43 | 2510408 no life
no life's picture

This is 100 bill just to bailout the spiderman towel banks.  Who knows how much it will take to bailout the sovereign black hole.

Sat, 06/09/2012 - 13:46 | 2510446 Tirpitz
Tirpitz's picture

Actually Spain ran a primary surplus -- till the banks sunk her.

Sat, 06/09/2012 - 14:33 | 2510581 gatorengineer
gatorengineer's picture

Tell that to the regions, ya gotta count it all.

Sat, 06/09/2012 - 13:38 | 2510414 russwinter
russwinter's picture

Once Spain takes the money, then their obligation in the EFSF and ESM bail out mechanism would be taken over by others.   Those "others" are Italy, whose share rises from 19pc to 22pc.  France's share rises from 22pc to 25pc, and Germany's from 29pc to 33pc.


The smaller core countries like the Netherlands, Belgium, etc will pick up a little more as well.  By piling more on Italy, and Belgium, and for that matter France (should trigger the downgrade), the credibility of the guarantees given to EFSF bonds would collapse.

Sat, 06/09/2012 - 13:47 | 2510450 Tirpitz
Tirpitz's picture

The dominoes keep tumbling...

Sat, 06/09/2012 - 13:38 | 2510416 disabledvet
disabledvet's picture

100 billion strikes me as pretty big. Of course "the Greece story was supposed to be only 5." The devil is in the details. Or is it the Great Satan?

Sat, 06/09/2012 - 13:49 | 2510454 Tirpitz
Tirpitz's picture

Probably a hundred billion for now.

Sat, 06/09/2012 - 13:39 | 2510419 Seasmoke
Seasmoke's picture

No Pain......... No Spain

Sat, 06/09/2012 - 14:21 | 2510547 Oldrepublic
Oldrepublic's picture

The Euro’s reign in Spain is mainly causing pain

Sat, 06/09/2012 - 13:39 | 2510421 Ned Zeppelin
Ned Zeppelin's picture

If you're dumb enough to short this market based on so-called "news" you deserve to be hosed.  Only humans short, not the robot algos.  Every opportunity to short is a set up.  The market is broken, try to think like a criminal.  

Sat, 06/09/2012 - 13:50 | 2510463 disabledvet
disabledvet's picture

I agree with this HOWEVER. "Once the shorts are washed out new shorting opportunities appear." It is however "the opposite of catching a falling knife" of course. I don't what that would actually. "Catching a Magic Carpet Ride" or something. Here's what it sounds like when you do it right:
from what i'm told "it's what looks like too."

Sat, 06/09/2012 - 13:40 | 2510423 MiniCooper
MiniCooper's picture

I heard that Spain is saying that it is 'agreeing' to a bailout without conditions and only after the bank audit has been completed - in other words sometime after the Greek election.

This is NOT a done deal yet.

Sat, 06/09/2012 - 13:45 | 2510442 Rich Bagg
Rich Bagg's picture

It's a done enough deal for the market to skyrocket on Monday.



Sat, 06/09/2012 - 14:01 | 2510494 MeanReversion
MeanReversion's picture

And now the bond vigilantes can turn to Italy.

Sat, 06/09/2012 - 13:42 | 2510431 JR
JR's picture

Spanish and American banks need money to prop up their economies?  No! They need to repay their masters, the international banks that have pushed them into financing gambling advances using inflation and money from their citizens. The banking crisis is: “We haven’t been paid our money.” A banking crisis means the banks need the money.

International bankers try to create the impression that banks are the foundation of a nation’s economy; that the banks supply the fuel for growth, and when there’s a crisis the banks have to be saved. Bankers now say the crisis in Spain is not like Greece’s at all; in Spain it is a banking crisis “that can easily be solved”; in Greece it’s an economic crisis.  And, of course, the way you fix a banking crisis is to give the banks more money. Whose money is that? In general, it’s German and American and Spanish taxpayer’s money.

As for propaganda, a François Picard panel said earlier that when Spain asks for the bailout money the latest steps towards a banking union in Europe could finally gain traction.

A bank is a place where people are to keep their money and if they want they can borrow some money from the other depositors and then pay it back at the other end. But these central banks and international banks have created a worldwide network of gambling with other people’s money, namely the tax money of citizens. They are way beyond the definition of a bank; they are speculators and gamblers and because the politicians give them access to other people’s money there is just no end.

US banks’ derivative bets of $230 trillion (bets on interest rates comprise 81% of all their derivatives) are concentrated in five banks and are 15.3 times larger than the US GDP, says economist Paul Craig Roberts.

Says Roberts: “A failed political system that allows unregulated banks to place uncovered bets 15 times larger than the US economy is a system that is headed for catastrophic failure.

My guess is these Spanish banks, just like little banks everywhere, are extensions of the central banks’ gambling with other people’s money.

The Fed was sold on the basis that it is going to be some sort of watch dog over the banking system, keeping it level and even, but instead it is the instigator, the initiator, of banking fraud. And all the time they are not producing any product, they are simply playing with other people’s money.

Sat, 06/09/2012 - 13:54 | 2510471 Tirpitz
Tirpitz's picture

They are way beyond the definition of a bank; they are speculators and gamblers...

Or, in short: money masters. Without any regard for the underlying economies nor the people that are to serve them.

The banking system has become entirely cancerous, so only a profound therapy will be able to cure us of this disease.

Sat, 06/09/2012 - 16:37 | 2510896 Olympia
Olympia's picture

Loan sharks knew that if they took the dollars printing machines under their control they could suffocate the world ...they could initially suffocate USA and after taking the USA from the Americans, they could move and suffocate the whole world and take the countries from their people.

FED printed cheap money and loansharking multiplied this money in an unnatural way within the American economy boarders and they discarded them abroad so that they did not threaten USA. USA became the first state in the world with artificial “breathing”...

It cannot be possible but just in the USA for only the last year, more than one million houses were seized. It cannot be impossible but the New World has returned to tents and shelters ..has returned to the ages of Columbus. It cannot be possible that we allow to a few loan sharks looting the toils and the assets of people...


Global Debt Crisis

Sat, 06/09/2012 - 18:05 | 2511049 emersonreturn
emersonreturn's picture

thank you, JR.

Sat, 06/09/2012 - 13:43 | 2510436 MiniCooper
MiniCooper's picture

This is what Sky News is saying in the UK:


"Spain will ask for eurozone aid BUT NOTuntil it has a clearer picture of the amount of capital its banks need, according to reports."

Sat, 06/09/2012 - 13:48 | 2510449 Market Man
Market Man's picture

Why on the focus on Spain THIS WEEKEND?   Because next weekend Greece will essentially vote to leave the Euro.   This is all about building a firewall around Greece.    Will the firewall work?   Place your bets!


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