Investors Get Jittery As Spain Enters Whole New World of Pain

[marmar]

Investors Get Jittery As Spain Enters Whole New World of Pain
by Don Quijones • September 8, 2015


[font color="blue"]Even chief financial alchemist Draghi is unable to prevent gravity from taking hold.[/font]

By Don Quijones, Spain & Mexico, editor at WOLF STREET.


After a summer of missed opportunities, poisoned rhetoric and bitter recrimination, Spain faces what promises to be a very tumultuous autumn.

On September 27 its largest economic region, Catalonia, will hold its most important elections since Spain’s late dictator Francisco Franco passed away 40 years ago. If the pro-independence parties win a majority of seats in Catalonia’s parliament, they have pledged to declare unilateral independence from Spain.

As if that were not enough, in December the country will hold what could turn out to be its most tightly fought general election in decades.

[font color="blue"]ECB at a Loss[/font]

The inevitable result is increased fear and uncertainty – two things that financial markets generally abhor. It’s already beginning to show in the performance of Spanish bond yields. ..................(more)

http://wolfstreet.com/2015/09/08/investors-get-jittery-as-spain-enters-whole-new-world-of-pain/

[Demeter]

1. If it weren't for the euro, would Catalonia want to walk?

This is step two on the destruction of a dream--an Impossible Dream, if you will pardon the allusion to quixotic ventures like the eurozone...

[MisterP]

2. frankly *when* Catalonia splits (no Balears for you!) I see them as moving under the French aegis,

euro or no, and Madrid will insist that the economic powerhouse take a lot of the national debt (it's like 500 years old, this debt); Belgium might also fall apart surprisingly quickly with or without the EU, so Paris might have its ... ambition stimulated

Scotland and Quebec currently get basically "transfer payments" to muffle secessionism and they'll probably just settle for "devomax" arrangements (which might mean less money from the capital if it's "play independence," or even shenanigans to sub-autonomize Shetlands)