Eurozone crisis: Spain edges closer to disaster as the euro crisis spreads

July 25th, 2012

FAKE NEWS for the Zionist agenda

Fears panic will spread from Spain to Italy and tear the Eurozone apart
British taxpayers could be dragged into a bailout of stricken Spain
FTSE 100 index of leading shares down 2% as Spain bans short-selling of shares to stem stock market losses
French and German markets down 3%
Italy heads towards bail-out with nearly £1trillion public debt
Spanish sovereign borrowing costs soar to crisis levels: 10-year bond yields at 7.5%, unsustainable in medium term

By
Hugo Duncan, Becky Barrow and James Chapman

PUBLISHED:

03:16 EST, 23 July 2012

|

UPDATED:

18:38 EST, 24 July 2012

The Eurozone was back on the brink last night as Spain edged towards a financial disaster that could tear the single currency apart.

Analysts said Spain’s huge economy was at a ‘tipping point’ and would inevitably need international aid.

In a sign that Europe’s debt crisis is deepening, Italy’s borrowing costs edged higher, Greece was was facing a 1930s-style depression and its austerity measures were said to be faltering.

Spanish Prime Minister Mariano Rajoy attends a plenary session in Madrid to debate the country's borrowing costs in the hope of drawing up a budget for 2013

Look of concern: Spanish Prime Minister Mariano Rajoy attends a plenary session in Madrid
to debate the country’s spiralling borrowing costs

Additionally, ratings agencies
threatened to strip Germany of its gold-plated credit rating because of
the risk of the crisis spreading.

Treasury officials refused to discuss whether British taxpayers could be dragged into a bailout of Spain.

While the Coalition has extracted the
UK from the Eurozone’s bailout funds, a full-blown crisis will probably
mean Spain will also need a loan from the International Monetary Fund,
of which Britain is a leading member.

David Cameron is pushing Eurozone
leaders to agree that Germany and other wealthy countries in it, such as
the Netherlands, should stand behind the debts of other countries.

Spain has already required an
emergency loan package of up to £80billion to bail out its banks but
that has done nothing to quell concerns about its ability to pay its
way.

The country is crippled by a property crash and recession and the
highest rate of unemployment in Europe.

Despair: A trader during afternoon trading on the floor of the New York Stock Exchange

On the up: At 1.285 euros, the pound is 14 per cent stronger versus the euro than this time last year

Spain’s crucial ten-year bond yield –
the interest rate the government pays to borrow and a key indicator of a
country’s financial health – hit a new euro-era high of 7.6 per
cent.

Enlarge

Dismissing worst case scenarios: Mario Draghi said that the eurozone will require greater integration in the long term

That is deep in the danger zone and well above the 7 per cent level
that triggered bailouts in Greece, Ireland and Portugal.

Spain is now
paying more to service its debt over six months than countries such as
Slovakia and the Czech Republic pay to borrow over ten years.

Sources close to the government were
reported as saying that Spain would need a loan to avoid ‘imminent
financial collapse’ facing the country when it has to cover a further
£22billion of debt in October.

The Eurozone was further shaken by
ratings agency Moody’s threat to downgrade the AAA credit ratings of
Germany, the Netherlands and Luxembourg.

Factory output in Germany and France fell at the fastest rate for more than three years.

The euro tumbled against the pound and shares from Madrid to Milan went into reverse.

Borrowing costs in Italy also soared as the financial markets bet that it will be the next domino to fall.

City analyst Gary Jenkins said. ‘The market is just saying Spain is a done deal, they are going to need a proper full bailout.

‘The danger is if Spain requires a bailout, the market will say Italy is next. And if that happens you have a major problem.’

Europe can ill-afford to rescue Spain –
the fourth largest economy in the single currency bloc – and Italy is
widely seen as too big to save.

In Greece, inspectors from the
European Commission and the IMF returned to examine the country’s
finances amid fears that austerity measures being demanded are simply
not achievable.

‘Greece is hugely off track,’ one of the officials said.

The Greek prime minister said yesterday that the outlook for the country’s economy is even worse than feared.

Antonis Samaras said output could
shrink by more than 7 per cent this year – a far steeper decline than
the 5 per cent fall forecast.

The slump will bring the cumulative
economic contraction to a punishing 20 per cent over the past five years
in an echo of the Great Depression of the 1930s.

The premier insisted the country will
return to growth ‘at the beginning of 2014’ and said he would seek a
deal ‘as soon as possible’ to water down the cutbacks and reforms
demanded in return for bailout funds.

VIDEO: Markets are taking a beating…

Here’s what other readers have said. Why not add your thoughts,
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The rich Spanish fat cats who have sucked their country dry should pay, not the British taxpayers.

– Lauren, Australia, 25/7/2012 00:59

Lets stop this crazy mess now. How can we lend out money to countries when we are more in debt than them. NOT LOGICAL. Lets get out of the eu NOW !!!!

– Tim Coleman, Nottingham, UK, 25/7/2012 00:57

Farage was right. He said this weeks ago
– terry, Folkestone, 23/7/2012 12:45
No he said it years ago. And how right he is, perhaps people will now realise that UKIP are the only party with common sense and with loyalties to the British Electorate

– worzel 1, portsmouth, 24/7/2012 23:52

When are these idiot politicians going to realize that they cannot go on like this and dump the euro, Its utter madness to continue like this. Maybe now that mighty Germany is in trouble they might think again.

– wind, in the willows, 24/7/2012 23:07

Wasn’t the DM predicting that the pound would be worth 1.33 Euros by now? Yet another DM prediction down the drain!

– Ted, Coventry, 24/7/2012 22:59

GRAHAM, IN A WORLD OF MY OWN, FAR FROM THE MADDING CROWD, BEYOND THE BLUE HORIZON, TENERIFE – THE LAST RESORT, 24/7/2012 21:45 F’gods sake tell me where you are. I’ll come and join you and give up this madhouse
– tony, sheffield, 24/7/2012 22:16++++++++Blimey mate, I think you need to go to specsavers.

– Dave, Hastings, East Sussex England, 24/7/2012 22:57

See what happens when Socialists get their grubby little hands on Capitalism, they don’t know how to handle it and when it all goes pear-shaped they are quite happy for someone else to bail them out and then have the cheek to expect you to vote them back into power for another go,————– Yvonne, West Midlands, UK, 23/7/2012 14:40—————-There’s always one joker. Spain has a right wing government, so has Greece, Italy , Portugal, Ireland and until recently France . The whole crisis started in the US with a Republican party in power. The countries doing best in the world Australia, Brazil and particularly China have left wing parties in power. Perhaps socialism is not as bad as you would have us believe

– Poppy Clarke, Croydon UK, 24/7/2012 22:52

Hasn’t the DM been predicting this will happen for years now? It’s like a stuck record.

– Ted, Coventry, 24/7/2012 22:51

“WHAT’S THE EURO TRANSLATION FOR ‘COPULATED’?”
– GRAHAM, IN A WORLD OF MY OWN, FAR FROM THE MADDING CROWD, BEYOND THE BLUE HORIZON, TENERIFE – THE LAST RESORT, 24/7/2012 23:45
You have a few choices they include “irreversible” / “manageable” / “NOT a Bail Out” / “fiscal unity” etc – lets face it the Euro is NOT going away, Germany France can NOT afford for it to do so so they’ll arrange loans to all the other countries so that all the other countries can then lend to a “stability fund” as soon as they think of another new name for it then those countries will borrow their own money back and the merry go round will keep on going until something economically good happens (a war ?) and then all the EU can start saying how they saved the Euro, like that’s a good thing.

– Stephen, Esh Winning, 24/7/2012 22:30

They thought it was over. It is now.

– Rigil, Kent, 24/7/2012 22:29

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