Euro zone’s fourth biggest economy is collapsing. In a dramatic appeal Spanish Treasury Minister Cristobal Montoro signaled on Tuesday that the credit markets are shut for Spain and that the debt-ridden country cannot borrow money anymore. Prime Minister Mariano Rajoy is claimed to press for a direct European rescue package to save his country’s banks but Germany is reluctant, apparently pressing for a full international bailout, the combined aid by EU/ECB/IMF as for Greece, Portugal, Ireland. Germany resists the urgent calls for issuing Euro Bonds. At least not before a fiscal union and a bank union. German Finance Minister Wolfgang Schaeuble went even so far to blame Greece for Spains’ banking crisis.
Spain is doing “everything right” with its reform measures but the country is suffering the effects of contagion from Greece, German Finance Minister Wolfgang Schaeuble was quoted as saying by Handelsblatt.
Schaeuble also said the euro zone needed to realise the medium-term project of fiscal union before discussing common euro zone bonds.
“The Spaniards are doing everything right and nonetheless they are coming under market pressure,” Schaeuble told the daily. “We need to manage this …through close and trusting coordination.” (Further reading REUTERS)
No, Schaeuble did not blame left-wing SYRIZA for the Spanish tragedy. Not yet. He could do it after the June 17 elections though…
PS I think, German Christian -Democrats are simply not able to cope with the crisis of the euro zone. Then, what’s the purpose of having at least four of EZ members into a bailout mechanism. While the next (Italy) may follow? What’s the purpose of enslaving citizens of EZ member-countries to an endless austerity? German Christian-Democrats should either come up with flexible, fresh ideas or resign and go retire in picturesque houses at the ever-green slopes of the Black Forest .
BTW Spaniards are also rush to banks and withdraw their money.