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Another run?

Posted By Peter Boockvar On May 17, 2012 @ 8:21 am In MacroNotes | Comments Disabled

Greek banks are not the only ones experiencing daily deposit withdrawals. Bankia, the Spanish bank that was half nationalized last week, is reportedly losing deposits and this will likely lead to a full nationalization at some point soon. The Spanish IBEX is at a fresh 9 yr low as also the country’s biggest banks, Banco Santader and BBVA are down another 2%+. Spanish 5 yr CDS is at a new high at 545 bps. The Spanish Finance Minister within the last 15 minutes is saying Bankia is not seeing ‘deposit flight’ and is saying depositors are safer now than they were before due implicitly from its nationalization. Bank runs is the European region’s worst nightmare and if anymore take place of substance, the ECB will have no choice but to step in with something. Spain did sell three debt issues out 3-4 yrs at about the target amount they hoped of 2.4b euros. The euro heavy Dollar index is higher for a record 14th straight day.

In Asia, Japan reported a better than expected Q1 GDP gain of 4.1%.

In the US, individual investor sentiment has gotten pretty bearish as AAII said Bulls fell to 23.6 from 25.4, the lowest since Aug ’10 while Bears rose to 46 from 42.1, the highest since Sept.


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