JP Marin Arrese, Author at The Corner

Articles by JP Marin Arrese

JP Marin Arrese

Juan Pedro Marín Arrese is a Madrid-based economic analyst and observer. He regularly publishes articles in the Spanish leading financial newspaper 'Expansión'.

Companies 13th January 2015

MADRID | By J.P. Marín Arrese | Santander´s management has provided little explanation for the huge 10% capital increase launched last week. The official announcement vaguely notes the need to seize new opportunities when economic prospects are improving. Can we bet on such a promising outlook when so many uncertainties prevail in Europe? It doesn’t seem very convincing. Rumours on potential take-overs also seem rather odd, as raising cash before entering a bid will only serve to increase the final bill. It makes more sense to gauge this move as a means aimed at buttressing the bank´s own funds.

Markets 13th January 2015

Bankia issuance challenged

MADRID | By J.P. Marín Arrese | The Spanish Justice Department has launched a thorough investigation into the accounts which were submitted prior to the original BANKIA share issuance back in 2011. Experts from the Bank of Spain have delivered a devastating report implying these accounts did not provide a fair elucidation of the balance sheet. Should the final ruling follow that line, it could open the way for multi-billion euro claims from investors. Even though BANKIA has announced it can cope with such losses, with taxpayers footing two-thirds of the bill, the impact on Spanish financial market credibility could wreak havoc.

In Europe 8th January 2015

ECB bound to act

MADRID | By JP Marín Arrese | Central bankers would be ill-advised to cave in to pressure from the markets. Yet, the ECB can hardly resist the urgent need to implement a fully-fledged QE programme involving sovereigns. Anything less could end-up sparking a period of vicious turmoil as Syriza seems poised to win the upcoming elections in Greece and the oil market continues to tumble into utter disarray. Such a grim outlook requires drastic action. Would it solve all the current problems? There are plenty of reasons to doubt it.

World economy 2nd January 2015

Greece: New Year brings past woes

MADRID | By JP Marín Arrese | As Greece plunges again into wild uncertainty, following a call for snap elections, once again the Eurozone shivers at the prospect of a full-fledged crisis. Even if the flight for safety has reduced the bund rates to fresh lows, no other economy has come under attack for the time being. But should Syriza emerge as the winning party in the January polls, the truce might be over.

In Europe 21st December 2014

Eurozone’s plight

MADRID | By JP Marín Arrese | Once again, Greece has ignited the flame of instability in the Eurozone. The prospect of early elections coupled with the left-wing party´s scores in the polls has resulted in severe shock-waves hitting other South-Med countries. The promised debt default by the better placed candidate in this race stands as a formidable threat to Europe. What happens in this relatively small country is bound to hit all of us. Confidence in sovereigns will dramatically fall while financials will also bear the brunt.

World economy 19th December 2014

Analysis: The oil crisis

MADRID | By JP Marín Arrese | Plummeting oil prices are sending shock waves to stock markets as investors fear the violent swing might cripple the global economic balance. Some exporting countries like Russia are crumbling while investments in industries face widespread disruption as they become out-priced. Even if importing countries are footing a downsized bill in the short run, volatility is never welcome.

Markets 15th December 2014

The ECB easing fails to fly

MADRID | By JP Marín Arrese | Just cast a look at the dismal performance of the medium-term targets of LTRO liquidity tenders, that amount to barely a fifth of the amount pumped in three years ago.

Markets 5th December 2014

Draghi fails to deliver

MADRID | By JP Marín Arrese | Markets took Mario Draghi´s encouraging promises at face value a couple of weeks ago. However yesterday’s ECB Council meeting failed to endorse any move to bolster the QE strategy. Super-Mario was only able to renew the central bank´s firm commitment to act should economic prospects markedly deteriorate. Investors felt utterly upset and reacted accordingly.

Markets 26th November 2014

ECB’s bond buying unlikely to bring growth

MADRID | By JP Marín Arrese | Up to now, all devices planned by the ECB to reverse the dismal situation have utterly failed. The medium-term financing facility has gathered little enthusiasm from the banking community. Covered bonds and ABS have proved to be blunders, their turnover limited to a meagre €20 billion per month. This heralded bazooka has petered out well short of its target. Banks are pressing for a widening of eligibility, hoping to transfer bad assets to the central bank. Others suggest a sweeping corporate bond buying thrust that would only benefit big enterprises, thereby introducing further distortions. Short of ammunition, the ECB has just one final weapon to curb the dwindling performance of the economy: sovereign bond acquisitions.

Spanish economy 20th November 2014

Podemos or Spanish radical’s economics

MADRID | By JP Marín Arrese | The radicalism of Podemos (we can) has won widespread popular support in Spain, scoring an astonishing result in the latest European Parliament election. It now runs a bitter neck-and-neck race alongside the two mainstream political parties. Its charismatic leader, Pablo Iglesias, has delivered devastating blows to opponents across the board, mercilessly portraying them as a corrupt “caste” all too eager to preserve their petty privileges, while bending to wealthy establishment’ interests. Yet, in an open bid for power, Podemos has undertaken a sweeping U-turn, transforming itself into a conventional party. Its leader has taken over as General Secretary and immediately launched discussions for setting up an economic manifesto.

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