News / Europe

Spanish Bank Rescue Euphoria Fades on World Markets

Traders look at electronic boards at the stock exchange in Madrid, June 11, 2012.
Traders look at electronic boards at the stock exchange in Madrid, June 11, 2012.
VOA News
The initial euphoria on world financial markets about Europe's $125 billion bailout of Spanish banks faded quickly Monday as investors reconsidered terms of the rescue package.

Stock indexes in Tokyo and Hong Kong surged more than 2 percent, and markets in London, Frankfurt and Paris moved up sharply in early trading. By the end of the day, however, European markets ended little changed from Friday's closing prices. Major U.S. stock indexes all were down more than 1 percent.

Spain's key market, led by financial stocks, initially jumped 4 percent, but ended the day down one-half of one percent.

Analysts questioned whether the bank bailout would hurt the Spanish government, since it ultimately is responsible for repaying the loans, and its borrowing costs are increasing. Spain is in the third year of a recession. It has the highest unemployment rate in the 17-nation eurozone and is struggling to regain its economic footing.

Related video report by Henry Ridgwell

Spanish Bank Bailout Brings Relief - But For How Long?i
|| 0:00:00
X
Henry Ridgwell
June 11, 2012 7:36 PM
Spain’s prime minister has called the $125-billion loan from the European Union to prop up its banks a "victory" for his country and the EU. Stock markets surged Monday following the bigger-than-expected bailout. But as Henry Ridgwell reports, with potentially seismic shocks around the corner, analysts say the relief for the euro crisis could be short-lived.
Robert Halver of the Baader Bank said the rescue package has just given the eurozone a bit more time to resolve the crisis.

"Spain's problems have not been solved, they have just been moved. The clock for the the eurozone has turned back from five-to-12 to 10-to-12 so we won a little bit of time, but the main problem is still the Spanish economy and its inability to carry out reforms and that is something that needs to be worked on," Halver said.

Some Spanish workers said they see little gain with the bank bailout. One court employee, Felicia Lopez, said the policies of Prime Minister Mariano Rajoy are misguided.

"Rajoy's government is rescuing the banks giving them big amounts of money, and at the same time it is destroying citizens' lives, cutting salaries, cutting benefits, cutting basic rights," Lopez said.

Oil Prices Still Falling on Europe Crisis, Weak Global Prospects (Watch Related Video by Mil Arcega)

x
Oil Prices Still Falling on Europe Crisis, Weak Global Prospectsi
|| 0:00:00
X
Mil Arcega
June 12, 2012 1:22 AM
Oil prices edged lower again on Monday, erasing a 2 per cent gain last week on continuing worries over the ongoing economic crisis in Europe and slumping growth around the world. With oil consumption falling and inventories rising, some energy experts believe prices have not yet reached bottom. Mil Arcega takes a look at what that might mean for oil producers and consumers.

Oil Prices Still Falling on Europe Crisis, Weak Global Prospects (Watch Related Video by Mil Arcega)

In securing the bank rescue, Spain became the fourth eurozone nation to need a bailout, after Greece, Ireland and Portugal. On Monday, Cyprus, one of the smallest of the currency bloc countries, said it, too, could need assistance, possibly within days.

Greece is set for new parliamentary elections Sunday, after last month's vote proved inconclusive. A new government could become the first country to quit the 17-nation euro currency union rather than face austerity measures demanded by the International Monetary Fund and Greece's creditors across Europe.

Some information for this report was provided by AFP and Reuters.

You May Like

Multimedia Social Media Documenting, Not Driving, Hong Kong Protests

Unlike in Arab Spring uprisings, pro-democracy protesters in Hong Kong aren't relying on Twitter and Facebook to organize, but social media still plays a role More

Analysis: Occupy Central Not Exactly Hong Kong’s Tiananmen

VOA's former Hong Kong, Beijing correspondent compares and contrasts 1989 Tiananmen Square protest with what is now happening in Hong Kong More

Bambari Hospital a Lone Place of Help in Violence-Plagued CAR

Only establishment still functioning in CAR's second city is main hospital More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
The Legacy of Jimmy Carter: The Preacher from Plainsi
X
October 01, 2014 10:45 AM
It is common in the United States to see tourists flock to sites associated with America's presidents. Some are privately owned and others are run by the National Park Service or the National Archives -- but most have helped draw business and people into the towns and cities where they are located. As VOA’s Kane Farabaugh reports, there is one particular presidential hometown that is unique in what it has to offer those who make the trip.
Video

Video The Legacy of Jimmy Carter: The Preacher from Plains

It is common in the United States to see tourists flock to sites associated with America's presidents. Some are privately owned and others are run by the National Park Service or the National Archives -- but most have helped draw business and people into the towns and cities where they are located. As VOA’s Kane Farabaugh reports, there is one particular presidential hometown that is unique in what it has to offer those who make the trip.
Video

Video Hong Kong Protests Draw New Supporters on National Holiday

On the 65th anniversary of the founding of Communist China, Hong Kong protesters are hoping to stage the largest pro-democracy demonstration since the 1989 Tiananmen protests. VOA's Brian Padden visited one of the protest sites mid-day, when the atmosphere was calm and where the supporters were enthusiastic about joining what they are calling the umbrella revolution.
Video

Video India's PM Continues First US Visit

India's prime minister is on his first visit to Washington, to strengthen political and economic ties between the world's oldest and the world biggest democracies. He came to the U.S. capital from New York, the first stop on his five-day visit to the country that denied him an entry visa in the past. From Washington, Zlatica Hoke reports Modi seemed most focused on attracting foreign investment and trade to increase job opportunities for his people.
Video

Video Malaysia Struggles to Stop People Joining Jihad

Malaysian authorities say militant groups like the so-called "Islamic State" have used social media to entice at least three dozen Malaysian Muslims to fight in what they call "jihad" in Syria and Iraq. As Mahi Ramkrishnan reports from Kuala Lumpur, counterterrorism police are deeply worried about what could happen when these militants return home.
Video

Video Could US Have Done More to Stop Rise of Islamic State?

President Obama says airstrikes against Islamic State militants in Syria will likely continue for some time because, in his words, "there is a cancer that has grown for too long." So what if President Obama had acted sooner in Syria to arm more-moderate opponents of both the Islamic State and the Syrian government? VOA State Department Correspondent Scott Stearns reports from the United Nations.
Video

Video Treasure Hunters Seek 'Hidden Treasure' in Central Kenya

Could a cave in a small village in central Kenya be the site of buried treasure? A rumor of riches, left behind by colonialists, has some residents dreaming of wealth, while others see it as a dangerous hoax. VOA's Gabe Joselow has the story.
Video

Video Ebola Patients Find No Treatment at Sierra Leone Holding Center

At a holding facility in Makeni, central Sierra Leone, dozens of sick people sit on the floor in an empty university building. They wait in filthy conditions. It's a 16-hour drive by ambulance to Kailahun Ebola treatment center. Adam Bailes was there and reports on what he says are some of the worst situations he has seen since the beginning of this Ebola outbreak. And he says it appears case numbers may already be far worse than authorities acknowledge.
Video

Video Identifying Bodies Found in Texas Border Region

Thousands of immigrants have died after crossing the border from Mexico into remote areas of the southwestern United States in recent years. Local officials in south Texas alone have found hundreds of unidentified bodies and buried them in mass graves in local cemeteries. Now an anthropologist and her students at Baylor University have been exhuming bodies and looking for clues to identify them. VOA’s Greg Flakus has more from Waco, Texas.
Colonel Steve ‘Spiros’ Pisanos left Greece and came to the U.S. to learn to fly. He flew fighters for the Allies in World War II, narrowly escaping death multiple times.Colonel Steve ‘Spiros’ Pisanos left Greece and came to the U.S. to learn to fly. He flew fighters for the Allies in World War II, narrowly escaping death multiple times.

AppleAndroid