The biggest problem, as Greece learned, is that once the priming begins, and the various sovereign debt classes start becoming subordinated, it doesn’t end, until the PSI. At which point the crammed down debt gets impaired and receives 20 some cents on the dollar recoveries… at which point Grey Wolf will tell you it is the «no-brainer trade» of the year.
Keep a close eye on Spanish sovereign bonds at the moment when the bond market understands what just happened, and once the euphoria over the very short-term bailout of insolvent Spanish banks passes. Because a month from today another €100 billion will be required, then another €100, and so on.
At that point even the officially acknowledged Spanish debt/GDP will surpass 100%.
via Details Emerge About Spain’s Cramming Down «Bailout» Loan | ZeroHedge.