Europe

June Beckons for Fortress Rajoy


June Beckons for Fortress Rajoy

Photograph by Angel Navarrete/Bloomberg

Using public-debt securities instead of cash to bail out BFA-Bankia (BKIA), the lender Spain nationalized on May 9, may shift the burden of recapitalizing it to the Frankfurt-based European Central Bank because banks can use such securities as collateral to get cash from the central bank. Spanish lenders net average borrowings from the ECB rose to a record 264 billion ($330.6 billion) in April, compared with 42 billion a year earlier, according to data from the Bank of Spain.

—Emma Ross-Thomas and Charles Penty, “Rajoy Seeks European Backing As Spain’s Access Narrows,” Bloomberg News, May 28, 2012.

I am losing scope and scale. My “access narrows” in euro-fatigue. I am losing ability to gauge, judge, and measure the little from the big of our Crisis of Europe.

“A record 264 billion euros” seems like a lot. Is it?

Some $24 billion to keep Bankia going? Is it? In the vicinity of $5 billion to mend Fortress Dimon? Is it?

Compare and contrast.

The national outrage over JPMorgan Chase (JPM) is $15.93 per American. (Give or take non-prop-trading adjustment; it is believed that the bank can cover this from here to eternity.)

Getting Bankia to June is $510.18 per Spaniard. (Give or take Gironaian condo appraisal; it is believed that the Kingdom of Spain cannot cover this … now.)

June beckons for Fortress Rajoy. Discuss.

Keene hosts Bloomberg Surveillance 7-10 a.m. ET on 1130 AM in the New York metro area and nationally on SiriusXM 113.

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