BBC News: Reports that Spanish Bonds have passed the 7.5% mark today, this has depressed Markets in the US and Europe, leading to the concern that Spain might need a Sovereign Bailout.
Lets Get Real:
Thus folks we have the Trinity problem with Spain, on one side we have the debts of the banks, the EU has agreed to bailout the banks, then we the debts of the regional Governments of Spain, this has been estimated at a 140 billion, at the end of the day due to the banks and the regional Governments the national Government of Spain might need a bailout. As noted in this blog there have been riots in Spain due to the austerity package of the new Conservative Government, it could get a lot worse folks if the Spain has to ask for Sovereign bailout, then the EU/IMF/ECB would have to place budget inspectors in each Spanish Ministry, they would have to have a VETO on any spending, the austerity measures would have to be even more brutal, as a Sovereign bailout of Spain would have to be harsh to prevent Italy going down the toilet. A joint bailout for Spain and Italy would break the Euro. Also the Germans have made it clear if Greece has not totally met its commitments over its austerity deal then there will be no more money, looks like Greece is a dead dodo that does not know its cooked. The good news folks its only Monday.
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