- Where did the money come from? If everyone is borrowing, who had the money to lend? The only thing I can think of is that the ECB printed more Euros.
- Why won't this money simply go to assist in the financial evacuation of Spain? That is, if you hold bonds or stock or assets in one of these Spanish banks and haven't been able to cash it in until now because the banks are such toads that no one else wants to have anything to do with them, what's to prevent this 100B from simply buying you out as you flee the scene?
- Spanish interest rates are rising again, less that 72 hours after the deal was done. After this sugar rush is done, what comes next?
- The German economy is big, but it's only as big as Italy and Spain combined and both of them are in trouble. How long before even Germany can't stop the slide?
- Speaking of Italy, where are they in all of this? How long before they start getting a share of the headlines?
- Why isn't this this a good summary of what just happened: 100B Euros were printed out of thin air and handed to banks who handed them to depositors, creditors and bondholders who are fleeing the scene?
- Lather, rinse, repeat?
Monday, June 11, 2012
Some Questions About The Spanish Bailout
So Spain picked up a tidy 100,000,000,000 Euros over the weekend to save its ailing banks. A couple of questions arise.