LONDON | Law-abiding citizens are happy, the government boasts about it and fiscal fairness rule over the land. But what does a £500-million extra tax bill collected from the wealthiest since 2009 says about the UK?
Where there is the European Central Bank’s full capacity of purchasing short-term State debt, there is hope. Even the primary market has opened, although by understandably timid measures, for southern euro zone debt issuers at a sub-sovereign level like State agencies and autonomous regions. The financial City of Madrid expects this window of opportunity to expand and demand of government bonds to improve as it is already happening to banks…
Negotiations must be already under way, but it looks as though the regional government of Madrid has somehow begun to surrender to the seduction and glitter of Las Vegas Sands Corporation’s much awaited arrival. Indeed, a deal that involves €18 billion of investment and 12 hotels, six casinos and three golf courses built by 2022 sounds appetising in the economically depressed surroundings of southern Europe. Esperanza Aguirre, president of the autonomous…
LONDON/MADRID | President Mariano Rajoy should manage to take this week a breath, although it will probably feel too weak. A simple look at the curve of Spain’s government debt now shows a steep upward gap between the internal rate of return of two-year bonds and the cost of the medium and long-term credit for the country. Indeed, 24-month debt paper’s IRR has tightened by more than 450 basic points…
Next Autumn, a panel of arbitrators will open hearings over the New York dispute confronting Spanish construction giants OHL and ACS, which blame each other for the mismanagement of tunnel excavation costs in their joint venture for a subway project. But its outcome is unfortunately known, already: it is set to please nobody. Least of all investors in both companies, analysts in Madrid say. Works to extend the Long Island metropolitan…
LONDON | Calls for further fiscal integration of the euro country members come extremely timely. Besides, they tackle the heart of the absurd problem that has been drowning since its foundation the common currency area a little bit deeper every day: utter disorganisation. The same goes for the banking union and budget authority. But these grand advances in the euro zone’s structures will need time and some effective communication strategy…
Hundreds of thousands of retail investors may share an uncomfortable feeling these days, that of being trapped under their holdings of what once was commercialised as ‘patriotic bonds’. Unloading them is proving a difficult task. While most sovereign and sub-sovereign debt securities in the secondary market move millions of euros, daily trade volumes of short-term paper issued in 2011 and 2012 by Spanish regional governments rarely reach the modest figure of €50,000….
MADRID | In the dialectics of the confrontation about how much of a national rescue is the aid package being draft by Brussels for Madrid and Rome, politics has so far played the upper hand. Apparently, governments in Spain and Italy would attempt to depict any coming bailout under a different light than that of Greece, Ireland and Portugal so their parties can avoid the stigma of having failed their…
Unless the Spanish government tackles the reform of the State administration, it is bound to follow the fate of Greece, Ireland and Portugal. Any positive impact of hints coming from the European Central Bank about lending a hand to maintain the country’s access to the markets will eventually fade away. Indeed, it is happening again. Most analysts in the financial City of Madrid said so in as many words in…
That the peripheral economies of the euro zone show time and again evident scars of a struggling performance is bad news, but known bad news after all. The close scrutiny to which Spain and Italy are being subjected leaves little room for surprises. All the alarms get restless, though, when core Europe somehow stumbles. And Germany has for some quarters now been bitten here and there by the decay surrounding it…