The Economy Minister Luis de Guindos, ruled today that Spain has to ransom his European partners, despite “the situations of irrationality in the markets,” which has led to the risk premium to maximum area.
From this consideration has Guindos speaking to the media before appearing at his own request, the Congress of Deputies to explain European aid to the bench and in relation to the increase in the risk premium, which exceeded 640 basis points today.
In this regard and asked if the government drops the rescue of Spain, De Guindos said: “of course” and thanks to a country that is “solvent” that has the capacity to grow and create jobs in the future.
The problem in Spain is “a brutal level of debt,” said the minister, who added that “there is no doubt that the process of deleveraging households and businesses” will be painful. ”
The moderation in consumption of the investment is a process that must be accelerated to pass as soon as the minister, who nevertheless believes that Spain is advanced.
Regarding the market tensions, has stated: “What we are seeing in the last days is a situation of enormous uncertainty and volatility, which is being irrational approaches.”
“The breakwater of this uncertainty about the future of the euro is in Spain right now,” said De Guindos, who has clarified that this situation is affecting not only Spain but also all the single currency.
So, after insisting that the government has done what it considers to have to do that is to carry out adjustment processes in the interest of fiscal consolidation, major economic reforms and sound banking, explained that the only way act “goes beyond the capacity of governments.”
“There are situations of irrationality in the markets, extreme nervousness,” said De Guindos, who said “not everything can be addressed by governments (…) must be approached from other points of view, with certain very specific actions” .
Asked if these actions are the purchase of debt by the European Central Bank (ECB), the minister has said that “you know it perfectly.”
With the ECB, “I maintain a huge caution, but beyond the actions of governments, there are institutions that should act in times of heightened uncertainty,” stated the minister, who believes that the short positions must be limited.
Although it has insisted, “not up to governments and yes to other institutions.
Despite the Government’s request, President of the European Central Bank (ECB), Mario Draghi, has said this weekend that the mandate of the lead agency fails to “solve the financial problems of the states” but to “ensure price stability and contribute to the stability of the financial system with complete independence. ”