Since I have been off for a few days I have a lot of links today, probably too many for one big linkfest but here they are. I will leave out more than usual to strip it down to the most salient ones. There’s a lot on Spain and India in particular. A lot of good Spanish-language links but I’ll try to address these in commentary later. I plan on doing my weekly commentary later today so I’ll have a lot more to say then.
But as I indicated two week ago, I think the EU has almost reached an untenable situation again and I expect something big. It’s not going to be eurobonds or anything like that. It could be something from the ECB but I don’t think the ECB has another good dodge left, frankly. The third link from Ambrose Evans-Pritchard gets into why. The only viable dodge being discussed is the EuroTARP, where the ESM/EFSF is available to banks as well as sovereigns.
Giving banks capital to support their balance sheets is how Europe is now dealing with the Greek situation so I think this will be put forward on a European-wide level as well. The most urgent place for the bank fix is Spain, so it could be limited to Spanish banks at first but cosmetically a euro-zone-wide policy would work best.
Again, this is just a dodge. It is not a solution. The point is to buy more time.
That’s it. Here are the links.
Spain
Why merging Spain’s troubled banks won’t fix the country’s debt crisis | Business | guardian.co.uk
Egan-Jones Cuts Spain’s Debt Rating to B From BB- on Outlook – Bloomberg
Former Bankia executive gets €14m payoff | Business | The Guardian
BBC News – Spain’s retail sales in record fall
Spain Regional Rescue Risks Tipping Point on Yields: Euro Credit – Bloomberg
Spain may recapitalize Bankia with government debt: source | Reuters
Spain runs out of money – Telegraph Blogs
Spanish debt costs spiral, Rajoy says no outside bailout | Reuters
BBC News – Investor fears hit Spanish bonds as Bankia shares drop
Spain’s property market gripped by new realism as prices plunge | World news | The Guardian
India
BBC News – India’s power sector in crisis
India GDP: not looking good | beyondbrics
Analysis: Indian rupee slump costly for $5.5 billion in convertible bonds | Reuters
Euro crisis
Europe’s money contracts again – Telegraph Blogs
Hedge funds take bets against core euro zone bonds | Reuters
Christine Lagarde attack on Greece backfires as she pays no tax – Telegraph
Christine Lagarde’s Greek comments provoke fury | World news | guardian.co.uk
Eurozone crisis: Ms Lagarde’s morality tale | Comment is free | The Guardian
Christine Lagarde: can the head of the IMF save the euro? | World news | The Guardian
It’s payback time: don’t expect sympathy – Lagarde to Greeks | Business | The Guardian
The End Of The Euro: A Survivor’s Guide | The Baseline Scenario
For the eurozone, the worst is yet to come – Telegraph
Fearful Germans add to Greece’s woes by staying away in droves | World news | The Observer
Frozen Europe Means ECB Must Resort to ELA for Banks – Bloomberg
China
Japanese SMEs take flight to China – FT.com
China Has No Plan for Large-Scale Stimulus, Xinhua Says – Bloomberg
2 trillion yuan may be invested in stimulus – Xinhua | English.news.cn
FT Alphaville » Is Chinese real estate nearing a tipping point?
Resilient China: How strong is China’s economy? | The Economist
The Epicurean Dealmaker: As Long as the Right People Get Shot
Facebook’s Brilliant Disaster – NYTimes.com
Bronte Capital: Facebook and the sad case of ethical investment bankers
Other
Secret ‘Kill List’ Tests Obama’s Principles – NYTimes.com
Debt-Ceiling Deja Vu Could Sink Economy – Bloomberg
US home prices hit new lows in crunch week for economy | Business | guardian.co.uk
RIM Writedown Risked With $1 Billion Inventory: Corporate Canada – Bloomberg
oftwominds-Charles Hugh Smith: U.S.A. 2012: Is This What We’ve Become?
The Irish Economy » DeLong and Summers and Self-Financing Fiscal Expansion (very wonkish)
Bush’s Terror Overreach Becomes ’New Normal’ Under Obama – Bloomberg
Repsol Seen Cutting Dividend to Defend Rating After YPF: Energy – Bloomberg
First Lady Jacqueline Kennedy’s trip to India, 1962 | Retronaut
International – James Fallows – Krugman, Fingleton, and Japan – The Atlantic
Sorkin’s Glass-Steagall straw man : CJR
Why Conservatives Keep Beefing with the Military – democracyarsenal.org
Why David Rosenberg is keen on Canada’s big banks – The Globe and Mail
Undervalued Leaders From Jeremy Grantham To Buy – Will You Let Them Pass By? – Seeking Alpha
Rand Paul Wants to Bring European Medicine to the United States — Marginal Revolution
Brad DeLong: Mitt Romney Believes in Expansionary Fiscal Policy
Appetite for Junk Bonds Shrinking Fast – MarketBeat – WSJ
Dow Pacing Losing Streak That Dates Back to 1903 – MarketBeat – WSJ
Consumer Sentiment in U.S. Climbs to Highest Since 2007 – Bloomberg
Argentina April industrial output off 0.5% on year – MarketWatch
Analysis – Argentina faces deficit for first time in years | Reuters
EU files WTO suit over Argentina’s import restrictions | Reuters