Once again, the disaster has come close to happening. And at the last minute, unspeakable pressure from the government has succeeded in getting Banco Santander to take over the huge hole in Banco Popular. Before it got this far, of course, capital was raised with money from unsuspecting new shareholders, bondholders and any other naïve people who believed in the image of security and solvency of characters such as those used by advertisers.
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https://youtu.be/xD_4thIw1FQ
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Most sports personalities, accustomed to selling their image for publicity, do so to the highest bidder without giving a damn whether they are selling more trainers or helping to wipe out the savings of humble families who believe that what Pau Gasol tells them can be trusted. It is difficult to apportion blame fairly: who is more to blame for small savers losing their money in these bank rescue operations: the bank manager, who is increasing capital or going public (Bankia) knowing full well that the investors he is deceiving are going to lose a large part of their savings? The regulator (BdE) who allows it, also knowing the critical situation of these balance sheets? The person who sells his image of credibility to convince those who without it would not trust that entity with their money? The bank employee who lies vilely to all the prey who sit at his table during the aggressive campaign to attract investment? The investor himself with his explosive cocktail of ignorance and greed? As the saying goes, between all of us the scammed and she alone is ruined...
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In order not to be hypocritical, it is worth reflecting on another point. If the final destination of a failed bank is a bail-in, in other words, more debt that will have to be paid for with increases in our present and future taxes, every euro from a private investor that the bank captures - in collusion with the CEO, regulator, employee or publicist - will be one euro less that those of us who have not been duped by the whole gang will have to contribute. Therefore, leaving ethics aside, if other naive people plug the hole a little with their savings, the rest of us will have to pay less with our taxes. A vomitous political-financial jungle in every sense of the word, of course.
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In the case of B. Popular, the disaster has been close to the crossbar and has only affected a priori the investors who trusted the institution as shareholders and the subordinated and preferred bondholders, while the depositors and the rest of taxpayers, for once, seem to have been spared another bank bail-in. But the million-dollar question is, in exchange for what? What has the government promised the Botín family to make them swallow such a toad? We will probably never know and it will remain, like the rest of the bail-outs and bank «reorganisations», indecipherably diluted in the tax returns that our children, grandchildren and great-grandchildren will pay for the rest of their lives.
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The corporate rescue of Popular is nothing more than another symptom of the coming winter. This time the explosion has been controlled and concealed under the carpet at Santander, which today is at least 7 billion euros less solvent. But the persistent zero rates can already engrave another notch in its hilt of underground financial institutions. The problem is that when Germany can't take any more inflation and decides to raise rates, we in the south will need another central bank to keep them at zero. Then our banks and our prices will be able to lift their heads timidly, but our current accounts and assets in the south will be priced at a lower value than those in the north.