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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: Haim R. Branisteanu who wrote (91292)	6/9/2012 12:53:03 PM
From: Haim R. Branisteanu	1 Recommendation Read Replies (1) \| Respond to of 218030

German Finance Minister: Spain's Bank Woes Solvable 09-Jun-2012 BERLIN--Spain's banking crisis can be solved step-by-step and shouldn't be compared with the more fundamental economic difficulties facing Greece, German Finance Minister Wolfgang Schaeuble said in a newspaper interview published on Saturday. Mr. Schaeuble told the Passauer Neue Presse daily newspaper that financial markets were again volatile because of the uncertainty created by the inconclusive Greek elections last month and the lack of any movement toward implementing the conditions placed on the second Greek bailout by the European Commission, European Central Bank and the International Monetary Fund. "The difficult reforms have been put on hold and so that gives rise immediately to a new danger of contagion on financial markets," Mr. Schaeuble was quoted as saying. "Spain on the other hand has a very specific problem with the banks, which are in a difficult situation as a result of the collapse of the Spanish real estate boom. But that can be resolved step-by-step." Mr. Schaeuble's comments were published as European finance ministers were laying the ground for allowing Spain to tap as much as EUR100 billion in loans from the euro-zone bailout funds--the European Financial Stability Facility and the European Stability Mechanism--to recapitalize the banks. Separately, Carsten Schneider, finance expert for the opposition Social Democrats, warned: "The Spanish bank bailout must not set a precedent because otherwise the EFSF and the ESM would be transformed from a bailout fund for states to a bailout fund for the banks. The Irish government accordingly would then make new demands and the banks in Cyprus also have refinancing problems." Mr. Schneider added that to prevent making taxpayers foot the bill for the troubles at European banks, the EU must first introduce a financial transaction tax to raise money for bailouts from the financial sector. "At the very least the signatories to the ESM should agree to introduce a financial transaction tax," he said in a statement. Mr. Schneider also said Europe should only provide aid for Spain's banks in exchange for tough restructuring of the financial sector. "The banks must be made smaller or shut down; state aid should only be given in exchange for a real investment that assures a voice and influence" over the banks. (END) Dow Jones Newswires