EU Bailouts

The EU bailouts are not over until

Debt crisis in Europe

In Portugal, the government seems to have enough cash to cover debt repayments this month, but can not find at a reasonable cost of € 10 billion needed in June to meet bond maturities. Bankers shouted - and heard loud-"Basta!"

Practically, to get the money before June requires negotiations to start soon, opera metherminefomenon if efinan after the elections would be too late. On the other hand, there are concerns in Brussels about whether a caretaker government can negotiate the difficult economic conditions that accompany the bailout.There are indications that the main political parties agree to negotiate, possibly under the auspices of President Aníbal Cavaco Silva.

However, digging a little deeper we see that not everything is rosy. Analysts believe that Greece will need more bailout money for a year, even in the unlikely event that satisfies (our country) the objective of the budget. And later, although the government denies the AUA, think they will be forced to restructure its debt.

In Ireland, expected new reliable stress-test banks to stabilize the financial system. But concerns persist, despite the government's assertion that there will be no sale of assets, which also would create new problems for banks - to reduce book value.

If Greece does default, the money will be needed for the recapitalization of banks that currently hold the mountains of the bond is above the limits of European support.

It is assumed that Spain will be able to run away from the crisis.The gap between yields on Spanish bonds and their German has fallen in recent months, reflecting this sentiment. Nevertheless, 10-year Spanish government bonds was at + 5.2% Thursday.And while the actions of Madrid in the past have helped to calm the creditors / purchases, analysts see the main risks in Spain lies elsewhere: in the ability of central government to affect the region. Can the Bank of Spain to find a way to enforce mergers, but how can adversely affect the regional and local authorities responsible for so much magales public spending?

The issue is not to predict disaster, but I just think that there are still many possible points that could lead to a sharp deterioration in the economic climate.

The euro has the tools to stop the crisis from spreading? Steps have been taken, but there is great flexibility with regard to crisis management mechanisms, in order to stem the existing rates. To understand any economics, everything is the trend and not absolute.

Last but not least, the economic situation is not as positive as it was a few months ago. Developments in the Middle East and Japan, energy prices contributed to increased uncertainty. A rise in interest rates from the European Central Bank will be unwelcome shaky banking structures that seek to strengthen their positions (funds).