Posts
http://world.time.com/2012/06/09/you-say-tomato-i-say-bailout-how-spain-agreed-to-be-rescued/
Madrid has gone from nibbling...to possibly chowing down an entire menu of euro tapas...finally admitting economic distress...and formally asking the eurozone for a bank bailout...up to an estimated 100 billion euros/$125 billion.
PM Rajoy denied needing a big bailout...even refusing to use the term...because of the bank reforms and restrictions that Germany and others wanted along with the money.
Rajoy's so-called 'bailout lite'...an initial 'modest' E40 billion or so to bolster real estate troubled banks...may balloon to 100 billion euros.
Reportedly...the IMF will not participate with any funds. The money will come from the eurozone's EFSF and ESM.
Madrid will decide on the total amount of the loan...after bank audits are completed.
The fact that Fitch has just downgraded Madrid's sovereign debt by 3 grades...to BBB... just 2 steps above 'junk'...added urgency to a bailout need.
But the EU's finmins finally convinced Rajoy about necessity of getting a bailout agreement before the crucial 17 June Greek election...and hopefully calming 'the markets'.
AND: More analysis about the possible market reaction: 'Not a lasting fix...more help is in the cards...but this loan buys time...until the fall.
http://www.google.com/hostednews/afp/article/ALeqM5iid-eFXlIP9OuceSjmvWIgFaiXcg?docId=CNG.513ecbbdc61bd72d49cc4662537f4cc3.441
