Spain’s Banking System Is Doomed To Collapse
Mike “Mish” Shedlock, Global Economic Trend Analysis
AUG. 10, 2013
The question on my mind today is “When will the Spanish banking system collapse?” Spain’s exposure to Portuguese sovereign debt and unrealized losses on real estate loans are two reasons a collapse in inevitable.
The Spanish banking system passed a so-called “stress test” in 2012, but sovereign government bonds are are not included in the evaluation.
We saw how well that worked with Greece (over and over again), and with Cyprus as well. It was Cypriot exposure to Greek bonds that collapsed the Cypriot banking system.