{"id":7179,"date":"2015-04-09T06:56:12","date_gmt":"2015-04-09T11:56:12","guid":{"rendered":"http:\/\/olduvai.ca\/?p=7179"},"modified":"2015-04-09T06:56:12","modified_gmt":"2015-04-09T11:56:12","slug":"this-could-sink-banks-in-greece-portugal-spain-and-italy","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=7179","title":{"rendered":"This Could Sink Banks in Greece, Portugal, Spain, and Italy"},"content":{"rendered":"<h3 class=\"entry-title\"><a href=\"http:\/\/wolfstreet.com\/2015\/04\/07\/european-commission-competition-this-could-sink-banks-in-greece-portugal-spain-italy\/\" target=\"_blank\">This Could Sink Banks in Greece, Portugal, Spain, and Italy<\/a><\/h3>\n<p>Not that much has changed in Spain since the climax of the debt crisis during which its collapsing banks were bailed out. Some of them were recombined into a bank with a new name \u2013 Bankia \u2013 and sold to the public via an IPO that immediately sank into red ink and scandal. Spanish government debt sported yields that reflected the risks of owning it. At this time in 2012, six-month T-bills yielded over 3.2%.<\/p>\n<p>But that part has changed. In this absurd era when risks no longer exist in a quantifiable manner, the Spanish government today joined a growing club: it issued its first debt \u2013 6-month T-bills \u2013 with a\u00a0<em>negative yield<\/em>. Spain!<\/p>\n<p>But the European Commission is now contemplating pulling the rug out from under the banking miracles in Spain, Portugal, Greece, and Italy.<\/p>\n<p>Turns out, these four countries have been smart in how they propped up their rickety banks. They and their banks have declared something a \u201chigh quality\u201d asset even though it has a dubious value, no market price, and can\u2019t be sold. And they have included this totally illiquid asset of dubious value in the \u201ccore capital\u201d of the banks. This asset significantly increases the \u201ccapital buffers\u201d and makes the bank more resistant to shock and collapse, on paper. That\u2019s how they solved their banking crisis.<\/p>\n<p>&nbsp;<\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>This Could Sink Banks in Greece, Portugal, Spain, and Italy Not that much has changed in Spain since the climax of the debt crisis during which its collapsing banks were bailed out. Some of them were recombined into a bank with a new name \u2013 Bankia \u2013 and sold to the public via an IPO [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[63,150,195,200,2535,284,1167,1464,4695,4696,743],"class_list":["post-7179","post","type-post","status-publish","format-standard","hentry","category-economics","tag-banks","tag-collapse","tag-debt","tag-default","tag-european-commission","tag-european-union","tag-greece","tag-italy","tag-piigs","tag-portugal","tag-spain"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/7179","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=7179"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/7179\/revisions"}],"predecessor-version":[{"id":7180,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/7179\/revisions\/7180"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=7179"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=7179"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=7179"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}