In Spanish press , could the Euro days be numbered in Spain?
NO ALTERNATIVE TO THE RESCUE, THE DEFAULT OR THE OUTPUT OF THE EURO
The Government throws the towel: "It is a matter of days, or help us or we sink"
As of today, the Government of Mariano Rajoy faces one of the most critical weeks of his mandate. After closing last week with the premium risk above 600 basis points and that trip to 640 in the early hours of today with the announcement of two autonomous, both of the PP - Valencia and Murcia - communities, of the ransom because have no liquidity to pay its employees payroll, and with the street on the edge of boilingWhat happens today can be definitive.
"What is happening to Spain it is not only the evidence of the failure of our policies as a country during all those years ago, it is also evidence of the failure of the European project, the incompetence of their leaders and the futility of their decisions," say sources very close to the own Mariano Rajoy. And is that the Government has no room for manoeuvre to make nothing more and depends solely from decisions taken in Brussels.
"Or help us or we sink us and Europe sinks, and is a matter of days, here cannot be with this maddening slowness with which normally Act Brussels", say in the Ministry of economy. Act means the ECB, as he comes claiming since last week by the entire Government, breaking with its traditional secrecy and either buy debt or at least make some effective gesture that leads to thinking the markets that you going to do in the short term.
But pessimism has been installed at the heart of the Spain Government to the point that Executive Rajoy already handles three possible scenarios that may occur in the next few days or weeks:
The first, the bailout. The Government believes that it is the less likely because a quantity would be an injection of capital in the more than 500 billion euro, Spanish coffers "exorbitant, hardly suscribible by the whole of the EU", inter alia by would imply that the next tab to break down would be Italy, which would imply one much higher amount - 700,000 million euros. In any case, "involves the recognition of a failure which, in addition, would inevitably lead to the end of the euro because the Nordic countries press for their break-up", indicate sources Executive. However, the Government already does not deny outright the possibility of rescue as it had been doing so far.
The second, the dreaded default, suspension of payments. It would be a way of pressing the ECB and the Nordic countries, primarily to Germany as main creditor of Spain, but at the same time "a tremendously negative image of our country, he moved and picturing the risk to unacceptable levels premium - although it is already-, and unless the EU acted fast us library nor the rescue", say these sources. However, is the option that the Government shuffle at this time as more plausible, inter alia because if any immediate decision is taken in the EU, the lack of liquidity will put at risk the payment of payroll staff and the interest on the debt "not later than August or September", added.
Third, the exit from the Euro. The Government does not rule out anything, and this possibility also is on the table. "We would again own currency and we act on our competitiveness indexes." It is true that at first it would have disastrous consequences, but return us autonomy to make our policies and get out of the crisis ahead of schedule. "That Yes, our creditors can longer go is forgetting to charge until our economy starts to recover", conclude these sources.
In any case, the Government seems resigned to make one of these three scenarios which is imposed in the next few days, although "from our point of view, the only truly effective way to this situation is that it was agreed at the last Summit, i.e. to build more Europe, go to Fiscal Union and the Union Bank." "But we can not afford the luxury of waiting months, it must be already, or at least to take significant steps in this direction," stated in the Executive of Rajoy.
Hence the call to Mario Monti that meet with Rajoy on 2 August in Madrid. And hence the discussions by telephone the President of the Government, is since the last Summit, quite often with French President François Hollande. Against the Norse immobility, the South joins coordinated action of pressure. "Is perhaps the one of the alternatives to the current configuration of Europe, but the doubt is going to be in where tilt the balance Paris, because that will be what they predict the success or failure of this new Alliance born of the crisis," concludes these sources.
This message was last edited by ojosazul88 on 24/07/2012.
This message was last edited by ojosazul88 on 24/07/2012.