{"id":10295,"date":"2012-06-18T17:49:44","date_gmt":"2012-06-18T09:49:44","guid":{"rendered":"http:\/\/maddruid.com\/?p=10295"},"modified":"2012-06-18T18:04:27","modified_gmt":"2012-06-18T10:04:27","slug":"2559-scary-quote-of-the-day","status":"publish","type":"post","link":"https:\/\/maddruid.com\/?p=10295","title":{"rendered":"[2560] Scary quote of the day"},"content":{"rendered":"<blockquote><p>&#8230;consider the grim fact that even\u00a0\u00e2\u201a\u00ac100 billion may not be enough to put Spain&#8217;s banks back on their feet, as they could easily face losses of perhaps three times that amount: Real-estate loans amount to\u00a0\u00e2\u201a\u00ac298 billion, construction credit to\u00a0\u00e2\u201a\u00ac98 billion, mortgages to\u00a0\u00e2\u201a\u00ac656 billion and other loans for families and firms to\u00a0\u00e2\u201a\u00ac683 billion. Assuming a 50% loss in real-estate and construction loans, a 5% loss in mortgages and 10% loss in other credits to the national private sector, brings us quickly to the worrying figure of\u00a0\u00e2\u201a\u00ac300 billion in losses. And don&#8217;t forget the banks&#8217; additional\u00a0exposure\u00a0of\u00a0\u00e2\u201a\u00ac78 billion to Portugal and\u00a0\u00e2\u201a\u00ac10 billion to Greece and Ireland, which could add losses of between\u00a0\u00e2\u201a\u00ac40 billion or more to our calculation.<\/p>\n<p>Spanish banks currently report total equity of\u00a0\u00e2\u201a\u00ac377 billion, so losses on this scale would leave them with just\u00a0\u00e2\u201a\u00ac50 billion to\u00a0\u00e2\u201a\u00ac70 billion remaining in equity. To bring them back to reasonably levels of capital would then require \u00e2\u201a\u00ac150 billion to\u00a0\u00e2\u201a\u00ac170 billion\u2014well above the\u00a0\u00e2\u201a\u00ac100 billion line of credit&#8230;\u00a0[&#8216;Bail-in&#8217; Spain&#8217;s banks, not bailout.\u00a0Juan Ram\u00c3\u00b3n Rallo. <em>Wall Street Journal<\/em>. June 18 2012]<\/p><\/blockquote>\n<p>No wonder yields on Spanish sovereign debt are going up, regardless of Greece.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8230;consider the grim fact that even\u00a0\u00e2\u201a\u00ac100 billion may not be enough to put Spain&#8217;s banks back on their feet, as they could easily face losses of perhaps three times that amount: Real-estate loans amount to\u00a0\u00e2\u201a\u00ac298 billion, construction credit to\u00a0\u00e2\u201a\u00ac98 billion, mortgages to\u00a0\u00e2\u201a\u00ac656 billion and other loans for families and firms to\u00a0\u00e2\u201a\u00ac683 billion. Assuming a 50% [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[10],"tags":[1511,1434],"class_list":["post-10295","post","type-post","status-publish","format-standard","hentry","category-economics","tag-banking-crisis","tag-spain"],"_links":{"self":[{"href":"https:\/\/maddruid.com\/index.php?rest_route=\/wp\/v2\/posts\/10295","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/maddruid.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/maddruid.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/maddruid.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/maddruid.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=10295"}],"version-history":[{"count":6,"href":"https:\/\/maddruid.com\/index.php?rest_route=\/wp\/v2\/posts\/10295\/revisions"}],"predecessor-version":[{"id":10297,"href":"https:\/\/maddruid.com\/index.php?rest_route=\/wp\/v2\/posts\/10295\/revisions\/10297"}],"wp:attachment":[{"href":"https:\/\/maddruid.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=10295"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/maddruid.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=10295"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/maddruid.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=10295"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}