Brace for impact : Spain is coming

Soon, we will get to know how truly suicidal the eurotrash in Brussels is. Greece was small potatoe. The sovereign banker takeover of Ireland as well. Portugal is just another bailout among bailouts. And then there is Spain, which is sizing up to 5-6 times the size of its smaller euro-cousins. And rumours have been spreading all summer and fall that they are in fact massively cheating with their numbers. Could this be why Jean-Claude Trichet and his henchemen at the ECB refuse to disclose how Greece managed to cover up their deficits? Because Spain is using the same mechanism?

Personally, I think the eurozone may end with Spain, regardless of what politicians do. Saving Spain means that either Germany and whoever has money left is going to demand they get to dictate fiscal policy for Europe in its entirity. That one is not going to fly. Or, Spain is not bailed out, and then the great unravelling of the pretension-mechanisms of the last couple of years begins. A complete restructuring of the entire European banking sector. Shareholders will likely get zero. Bondholders will probably get haircuts. And it will most likely mean that European debt issuance disappears as an option for all but Germany and a handful of sane nations (my native country of Sweden being one).

The welfare state was always destined to go bankrupt, the only question was if it would do so with a bang or a whimper. Since everyone has gone ALL in on there being five aces left in the deck, I think we can safely assume that there will be some sort of bang. The sad part is that economic recovery could have begun, if governments weren't such cowards when it comes to realizing losses. Banks could easily have been taken into receivership and chopped into pieces during 2008. Why didn't anyone? Probably because banking is as intertwined with political interest in Europe as in the US. Only difference is that here, the bankirs do not buy the politicians, they buy their debt.

The coming decade is going to make many people, especially those at the lower rungs of society, very poor. They will not understand why. All so the global politician/banking class could have their fun, pretending that their centrally controlled ponzi-experiment works for a little longer. I am assuming people are going to be even more pissed off in 6-12 months, so for now I'm keeping my savings in the cookie jar.