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quantitative easing alla spagnola 
How to roll debt, Spanish style
Posted by Izabella Kaminska on May 07 13:05.
As the FT reported:
If true, this could be why the auction has so far done little to restore risk appetite and why the cost to insure against default on Spanish government bonds still soared on Thursday, along with almost every other eurozone financial cds.
Here, specifically, was the action in Spanish sovereign cds:
Related links:
A Spanish bond auction litmus test - FT Alphaville
The slow death of the cajas – FT Alphaville
Who’s most at risk of falling into a European debt funding trap – FT Alphaville
This entry was posted by Izabella Kaminska on Friday, May 7th, 2010 at 13:05
How to roll debt, Spanish style
Posted by Izabella Kaminska on May 07 13:05.
- Take $3bn worth of five-year bonds to market.
- Offer an average yield of 3.53 per cent — 72 basis points more than offered the month before.
- Politely force ask your domestic financial institutions to participate.
As the FT reported:
[Spain] had to pay an average yield of 3.53 per cent on the sale of €2.35bn ($3bn) of five-year bonds, 72 basis points more than when it sold five-year bonds only a month ago. It is the highest yield for the sale of new Spanish bonds over this maturity since May 2008.
But according to Cotizalia (via Google Translate):
The Government yesterday had to ask for help large Spanish financial institutions to place a bond issue five years, with low demand that recorded between foreign entities, as confirmed by several sources familiar with the operation.
In this way, managed to avoid a similar failure to that of Greece in late March, which gave rise to the top of the current resurgence of the debt crisis of the peripheral countries.
In this way, managed to avoid a similar failure to that of Greece in late March, which gave rise to the top of the current resurgence of the debt crisis of the peripheral countries.
“With the sensitivity that is now in the markets to Spain, if they fail to cover a bond issue would have caused an earthquake,” said one of the sources consulted.
Hence, the Treasury touched the keys to prevent it. It was quite a dance to the entire banking given the small size of the issue, which ultimately was of 2,345 million euros.
Yes, the move towards the Treasury came out: in exchange for achieving a strong demand for 5.522 million (2.3 times the bid, the highest ratio of all placements, 2010), had to pay an interest rate of 3 , 58%, 26% more than in the previous placement of securities for that period, held on 9 March.
The allegation here is that the Spanish government was forced to lean on domestic institutions to pick up sovereign bonds, in case foreign investors didn’t show up.Hence, the Treasury touched the keys to prevent it. It was quite a dance to the entire banking given the small size of the issue, which ultimately was of 2,345 million euros.
Yes, the move towards the Treasury came out: in exchange for achieving a strong demand for 5.522 million (2.3 times the bid, the highest ratio of all placements, 2010), had to pay an interest rate of 3 , 58%, 26% more than in the previous placement of securities for that period, held on 9 March.
If true, this could be why the auction has so far done little to restore risk appetite and why the cost to insure against default on Spanish government bonds still soared on Thursday, along with almost every other eurozone financial cds.
Here, specifically, was the action in Spanish sovereign cds:
Related links:
A Spanish bond auction litmus test - FT Alphaville
The slow death of the cajas – FT Alphaville
Who’s most at risk of falling into a European debt funding trap – FT Alphaville
This entry was posted by Izabella Kaminska on Friday, May 7th, 2010 at 13:05
che minkia stanno combinando
