Rajoy’s claim for fame
Spain’s Rajoy pulls the magic move over the weekend by requesting the bail out (more to come according to The Trader). Discounting this as massively good news could prove rather dangerous. The Spanish economy is in a much bigger mess than only needing 100 billion Euros. The zombie urbanizaciones won’t be helped much by this small bail out. In order to fill up those + 1 million empty properties, prices need to come down much more, and that won’t be met by the 100 billion bail out. For now, enjoy the Risk On mood credited to Rajoy. From El Pais.
After being widely criticized for failing to appear in public on the day that Spain accepted a European Union bailout for its debt-ridden banking sector, Prime Minister Mariano Rajoy improvised a brief press conference on Sunday to explain the financial rescue package before flying off to Poland for the Euro 2012 soccer match between Spain and Italy.
In his first solo address to the media since he was elected last November, the always-cautious Popular Party (PP) leader took care to avoid using the word bailout, and instead talked about “a loan” and even “yesterday’s event” to describe the agreement with the Eurogroup of financial ministers to prepare a bailout to clean up Spain’s financial sector.
Rajoy stated that his government’s strategy has been to avoid “semantic debates” as to the nature of any eventual assistance at all times.
For his part, Economy Minister Luis De Guindos has called the up to 100-billion-euro loan “financial help.”
Rajoy, who was elected on the promise that he would reduce the country’s risk premium, create jobs and above all restore investor confidence in Spain, has finally had to request a bank loan that he tried desperately to avoid.
But on Sunday the conservative leader turned the criticism on its head and claimed that this situation is exactly what he had been seeking personally for weeks, although until now he had been saying the contrary “out of discretion.”
Full article here.