With Spanish sovereign bond yields hitting record lows - marginally above those of the US - one might be surprised to learn that unemployment is at record highs, suicide rates are at record highs, youth joblessness is at record highs, and now, to top it all off, Spanish bad loans are at record highs once again (at 13.6% of all loans). Of course, not deterred by the uncomfortable reality, Economy Minister Guindos is out in full propaganda mode:
- *GUINDOS SAYS BAD LOANS RATIO SEEN MODERATING IN NEXT QTRS
However, given the 17.7% rise in the last 12 months - the most in a year - we are struggling to see signs of the turning point he is so confident of.
The data - Guidos argues - reflects "recognition of reality" in what seems like an admission that all the spin and hoopla about marginal improvements til now have been based on entirely unreal data...
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Did Spanish banks kitchen sink it? We highly doubt it as unemployment levels strongly suggest the worst is yet to come.
Charts: Bloomberg