Three Out Of Four: Spain Joins Ireland, Portugal With A Gun To Its Head, Demanding Concessions
by Tyler Durden
Previously we noted that, just as expected, the weakest PIIGS – Portugal and Ireland – wasted no time to start rumblings about a “suddenly slowing economy” in the aftermath of the Greek bail out which achieved nothing but to delay contagion by 48 hours (we won’t bother readers with the blow out in Italian bond yields any more), and to unleash demands by everyone else to get the same concessions, in essence pushing Europe into an even deeper hole, forcing Golum Van Rompuystiltskin to say he was only kidding about the 4-5x EFSF leverage: he really meant 45x. Confirming that the tsunami of demands has been unleashed is today’s announcement from the Bank of Spain that not only was Q3 GDP flat (read: negative), but that the deficit target for the year would not be achieved. Google translated from Expansion: “The Bank of Spain says the Spanish economic growth was zero in the third quarter from the previous quarter and warns that there are significant risks that may prevent achieving the deficit target this year. The Bank of Spain said that the information available for the third quarter suggests that the pattern of decline shown in the previous quarter “would have continued in the middle months of the year, in an environment marked by the deepening crisis of sovereign debt euro area.” Truly nobody could have seen this coming, yet it is odd how it was casually slipped in broader discussion three short days after the Greek bailout.