Lesson not Learned: The Fed Floods the Market with Fiat Money

By LUIS MIRANDA | THE REAL AGENDA | SEPTEMBER 14, 2012

Quantitative Easing is no longer an option for the private Federal Reserve and neither for the US. QE1 and QE2 did not avoid the fall of the United States, so QE3 did not make sense. Instead, Ben Bernanke has implanted a new fiat money manufacturing scheme I’d like to call Unlimited Easing.

In the same fashion that the European Central Bank is now able to buy unlimited amounts of debt from bankrupt countries like Spain, the Fed has given itself the prerogative to buy unlimited amounts of mortgage loans in an attempt to artificially lower interest rates and ‘stabilize’ the crashing home loan market. The $64 million question is how much will this unlimited easing help to rescue the mortgage market? Not much according to Ben Bernanke himself, who has said the move is not a panacea.

As some US media reported, the Fed once again pulled the trigger, but only to shoot the country on the other foot; an action that will certainly result in more difficult times for Americans. The U.S. Federal Reserve announced the ‘liquidity boost’ to help the economy and that such injection of fiat money will continue, which according to Ben Bernanke, shows the Fed’s commitment to help with the recovery. Double speak? Mind games?

At the end of their two-day meeting, the Fed said in a statement that it intended to “launch a program to buy mortgage-backed securities valued at $40 billion a month” and that the program would not have a limit in the amount spent or a deadline to conclude.

The organization led by Ben Bernanke said that if you add the “Operation Twist”, a program to swap short term bonds for long term ones, to the new scheme to buy mortgage backed securities, the Fed will be buying about $85 billion a month. Also, the U.S. central bank said it will keep interest rates at exceptionally low levels between 0% and 0.25%, until “at least mid-2015”, instead of the end of 2014 as announced in January of this year.

The Fed said that “highly accommodative monetary policy will remain appropriate for a considerable time until the economy strengthens.”

The chairman of the U.S. Federal Reserve (Fed), has defended the new measures adopted Thursday by the institution, while economists question the validity of a program that not even Bernanke sees as a real solution to the real problem. The chairman of the Fed insisted in his speech that his actions are not the “panacea” and “do not cure all ills” now affecting the economy.

In the press conference following the meeting of the Federal Open Market Committee (FOMC) of the Fed, Bernanke said that monetary policy alone — especially the wrong kind — will not solve all problems by itself, so politicians have to do their part. He also, emphasized that the Fed can not be rushed when leaving a highly accommodative monetary policy and pledged to hold such policy until the recovery is sustainable and allows for job creation.

However, he added that no set of policies can be extended until the objectives of his mandate are achieved. Those supposed goals include a significant improvement in employment, manufacturing and consumer spending. There is no need to say that under the current policies and the new ones the Fed has adopted, none of the goals will be ever accomplished. In fact, it is quite the opposite. The continuous unrestricted pumping of fake money into the economy will only prolong the disease.

Bernanke acknowledged that the situation in the labor market is still assessed as concerning, and stressed that the current level of economic recovery is not good enough to have the unemployment rate fall.

Democrites: The Socialist, Death-pushing Party

By LUIS MIRANDA | THE REAL AGENDA | SEPTEMBER 5, 2012

If Barack Obama was slick enough to confuse anyone about what the Democratic Party stands for, the party itself has made it very clear now. The Democratic Party, and more specifically, the Democratic Party platform for 2012 is the most Socialist, Godless, Death-pushing group in the history of the United States.

One thing is to believe that help should be given to anyone in dire need, or that God is an un-tangible abstract ideal that a part of society prays to. Another very different stance is to impose legislation on hundreds of millions of people because a man or his handlers want to install a de facto socialist system, remove God from the platform to attract non-believers and explicitly use people’s money to fund abortions through government and government affiliated organizations.

The Democrite Party is Nemesis, the pale horse that we’ve all read or been told about since we were born. But worse than the party platform, is that such platform has found a strong acceptance among millions of Americans, who as pointed out on Monday, are people who live inside an illusion bubble that has turned them into the most deceived population in the history.

“Government is the only thing we all belong to”, says an ad supported by the Democratic National Committee. That is the very definition that a collectivist organization would want people to believe, instead of “you can forge your own destiny”. If government was the solution to the numerous problems that it itself has created, we would not need elections, and that is what Democrites believe and want. Of course, we all know it is not so. Government, as it stands today, is the problem, not the solution.

Natural Law or common law is the most successful guide to getting as far as we had, until government appeared. The set of moral and legal standards which aren’t written anywhere, but that everyone knows very well is what has worked throughout history, and that is precisely what both the Democrat and Republican platforms lack: morality. That is why Natural Law worked and government did not.

The standards in Natural Law are part of humanity, of being human, and therefore derive from human nature and the world we all live in. Government on the other hand, is a creation of a group of egotistical, selfish demagogues who believe they know better how to run our lives. Both presidential candidates in 2012 favor collectivism, big government and government mandated everything for everyone. Government is an entity that, despite having been created by humans and being composed by humans, has turned into a creature that violently enforces its own rules in detriment of its creators, as supposed to obeying the natural, common laws.

The Democratic Party, more than the Republican, is the party of Death; not because they do not believe in God or because it is excluded from its platform, but because they officially pronounce themselves in favor of abortion, a practice that has killed at least 50 million people in the US. Many of these abortions have counted with the financial support and funding from government. Has it happened under both parties? Sure. But the Democratic Party has been the one that has more strongly reaffirmed they compromise with government funded abortions.

Please do not let yourself be fooled by either Republicans or Democrites, as they will do whatever it takes to keep you tied up and dependent. As explained by Dr. Russell Blaylock, government is great at masking its true intentions, and it has done so throughout the last 200 years. “In the 1800s they did not shy away from the term socialism, but as people began to understand that socialism was a form of social control and engineering, they dropped the term for more acceptable terms such as liberalism, progressivism and collectivism.” Do any of these sound familiar?

Both parties have had their shots at destroying the United States for the past century and in the process keeping people sound asleep, but now that their attempts to keep people from waking up have failed, they ask for more time while reinforcing how trustworthy they are. Both the Republican and Democratic Parties are now trying to buy more time before they fully accomplish their dream. What is their dream? Let’s have author Eric Voeglin explain it to us. In his book, “From Enlightenment to Revolution“, he states:

“In its outline we see the idea of mankind dominated by a chosen people who embodies the progressive essence of humanity. In historical actuality that would mean a totalitarian organization of mankind in which the dominating power would beat down in the name of mankind and freedom everybody who does not conform to the standards.”

Again I ask, does it sound familiar?

By the way, if you think socialized medicine is the cure for all social ills, please be sure to read about the origins of such an aberration (see paragraph 11).

While the United States drowns in debt — $16 trillion and well on its way to $20 trillion — the gullible people are told that the answer to the debt is getting into more debt. While people go hungry around the country, the socialists say that the answer is more food stamps — 46.7 million in total. While the nation starves for innovation and employment, Obama funds his buddies at Solyndra.

The message of “we are the party of diversity, of new ideas, or progress, hope and change” is just a socialist set of smoke mirrors. Under the diversity umbrella, the Democrites seek to buy off minorities and the most needy, bribing them with free stuff so they remain passive and condemned to the misery they’ve always lived in. The highly unsophisticated population of illegals — generally poorly educated in their home countries — who invade the US from all directions, and who only want a handout to step forward towards the illusive American Dream will appreciate the fast-track towards citizenship so they can vote for the pirates that let them onto the sinking ship.

With the ship they shall all sink while the captains are long gone.

United States: The Illusion of Choice, the Reality of Fraud

From Welfare to Warfare, the United States of America has the most deceived population in the history of humanity.

By LUIS MIRANDA | THE REAL AGENDA | SEPTEMBER 3, 2012

It is called the American dream because you’ve got to be asleep to believe it. Meanwhile, truth and reality are ridiculed, opposed and then accepted before they are beaten to death. The time it takes the average American to realize it’s all a dream — the big house, the corner office with glass windows, the managerial position, the six digit salary and the recognition — is the same time it takes him to wake up. The problem is, not many Americans actually wake up.

Before every single American’s eyes, the Republican Party shamelessly erased from all records the choices made by hundreds of delegates all over the country who did not support Mitt Romney for the presidential nomination. The corporate board of the party simply decided that in order to smooth out Romney’s entrance into the race for the presidency, its handlers had to change the way delegates were chosen and counted.

I would love to explain it to you, but it is easier if you watch it and understand the level of fraud, hubris and disregard for the voters that now fills the foundation and core of the Republican Party. Let’s just say that after the Republican National Convention of 2012, never again will people who support this party and any candidate that is not backed by the establishment of this corrupt organization, be able to actually elect their representative to the convention; much less their man or woman to run for the presidency.

Please watch and listen with attention and try to strap yourself in. Believe me, you will need the straps.

I told you those straps would come handy.

In case you did not understand the reporter, let me explain it in layman’s terms. The motion passed at the Republican National Convention of 2012 assures that only the establishment candidate of the Republican Party or the Republican president in office will decide who is named an official delegate to attend the National Convention and vote during that event. Forget about caucuses and primaries.

And you thought there was a choice, didn’t you? Unfortunately, choice is just one of the most fashionable illusions that the average American believes in. The motion passed and adopted by the RNC is not only bad because it stole rightfully owned delegates from Ron Paul, who won enough of them to challenge Romney at the Convention this week, but also because, regardless of who the candidate is, it is clear that the establishment politicians and media feel threatened by a kind of man that only comes around once every century or so. Perhaps less often.

Why do they feel threatened? Because despite the circus put together by both the Republican Party and the corporate media, Mr. Paul was able to get his message through to millions. But the threat grew bigger, because all those millions of people, even outside the United States, actually listened and began the largest and most important liberty movement in recent history.

Unfortunately, on the other side of the aisle, things are not well either. Obama is the other side of the illusion coin, the second face of the fake choice that the owners of the United States of America — and large portions of the rest of the planet — chose to deceive the gullible members of the uneducated, clueless population. To say that the Barack Obama phenomenon is a deception would be short of what needs to be said about him and his corporate supporters. But to be fair, let’s compare the two men who are now in the race to govern over the United States.

What do these two men support and what do they oppose?

Both Mitt Romney and Barack Obama support, as their voting record and public statements show, the following policies:

1. Bailouts, ‘too big to fail’ concept, stimulus packages, quantitative easing and deficit spending.
2. Sending troops to protect others borders and sending our money to foreign dictators.
3. Interventionist foreign policy from Bush era.
4. Federal restrictions on gun ownership.
5. Patriot Act.
6. Spying on American citizens without warrants.
7. Indefinite detention of American citizens without charge, trial or lawyer.
8. Assassinations of American citizens or anyone else without due process.
9. Socialized Healthcare

Both Mitt Romney and Barack Obama oppose, as their voting record and public statements show, the following policies:

1. Balancing the budget in less than 30 years.
2. Paying down the national debt.
3. States rights to make their own laws.
4. Sound fiscal and monetary policies.
5. A policy of non-interventionism.
6. Freedom to choose by entrepreneurs and consumers.

Although for many years Americans were seen abroad as uneducated arrogant people, that opinion has now changed. The best description of the average American abroad is now that of an uneducated, arrogant plantation slave who for a long time — even today — enjoys and rejoices with the prison he lives in. While most of the world has been devoid of opportunity and resources to succeed by the same forces that control the American way of living, American citizens have been acclimated with the benefits that a nation’s artificially strong currency has been able to provide.

The unlimited plentifulness reinforced the illusion of the American Dream and that alone blinded roughly 99% of the population. It was due to the rise of people like Ron Paul and his grassroots movement composed by genuinely concerned people that the 99% shrank to 95% or so. Members of that vociferous minority were the ones who elected enough delegates in at least 5 states where Ron Paul beat Mitt Romney by a long shot. By changing the rules on how delegates are chosen, the Republican Party has assured its establishment core that never again will a grassroots movement challenge the election of a candidate that does not accept the imposition of the Party’s official platform.

With the political landscape sorted out, one must take a look at the other illusion.

Even though the state of the economy has made it more apparent that things are not going well for the American people, it is not uncommon to read, hear and watch reports about fat bonuses being paid to corporate leaders and bureaucrats with taxpayer funds. Needless to say that the US sponsored bailouts of American and European banks have pushed the country that much closer to the deep and dark cliff of insolvency and bankruptcy. But if you ask the average American about it, he just can’t see it or feel it.

From the American lack of real education, little perspective on history and zero understanding came the illusion of prosperity. Having the world’s reserve currency, which enabled Americans to enjoy artificially low prices, permitted politicians to adopt and advance the debt-based economic and financial systems. The collapse of the American way of living did not start in 2008, 2007, or 2006, but in 1913.

That collapse was incrementally pushed through the years at a very slow pace, so ‘the frogs’ wouldn’t notice the heat of the boiling water. The supposed prosperity was a smoke screen that led to the United States’ precipitously approaching collapse. The financial bankruptcy of the US has gone from being a conspiracy theory, to becoming a mathematical certainty. The United States is drowning in debt and so is the rest of the world. But contrary to what the corporate media, main stream liberals and socialists believe, there is no way in the world to pay that debt off. No amount of raised taxes, no money printing scheme, not even if all of the  GDP money was used to attempt to pay the debt could the US eliminate its heaviest burden.

Right now, the United States is suffering from two incurable problems: National Debt and Federal Deficits. Although they are separate issues, they are indeed interconnected. The debt is created as the Federal Government is unable to keep its spending in check and limited to the production of the country. This creates a need for borrowing money from the FED or China or whoever is crazy — or smart — enough to lend the US. The national debt is the sum of all debt owed by the US Federal Government including borrowed money and the interests it has to pay on it.

The deficit on the other hand, is the difference between the budget the US has and what it actually spends in a specific year. So, for example, if in 2012 the US had a budget of $ 100 but spent $130, the deficit for 2012 would be of $30. Since the US has no way of paying the $30 difference, it puts the $30 as debt to be paid in the long-term; say 50 years. During that time, the US as whole — its citizens — will have to pay interests on that debt, while the original $30 remains unpaid. Because the original debt goes unpaid for decades, it continues to accrue interests over interests, which then become impossible to pay as well.

The problem is that the deficit is not as little as $30 and therefore the debt is not small either, so the interests have been exploding over the past century or so. Today, the US National Debt sits at $ 16,001,431,267,262.98. With an estimated population of 313,431,758 in the US, each citizen’s share of this debt is $51,052.36. Got some spare change? Don’t worry, because this is not your debt. It is the debt generated by the out-of-control Federal Government that illegally mortgaged the lives of generation after generation to pay for its limitless bribery schemes such as Social Security, Medicare and Medicaid; to finance wars in the Middle East and everywhere else in the world, as well as to give bailouts to American and European banks.

Although you didn’t exactly approve of the creation of this debt, you did indeed enable the crime of indebtedness if you supported either political party  and voted for any of their corporate creations such as Jimmy Carter, Ronald Reagan, George Bush Sr., Bill Clinton, George Bush Jr., and Barack Obama. So yes, you have been an instrument to the crime; knowingly or not. Also, please realize that the debt will continue to grow as it has always have. For the period of 2007 through 2012, the US National Debt grew $3.88 billion per day. (conservative estimate).

Please see the graph below for a historical perspective on US debt since 1940 until 2011:

Click to Enlarge. US debt from 1940 to 2011. Source: CrisisHQ.com

That is what I mean when I say Americans are seen as uneducated, gullible people. The system used by the corporate-owned US government is an example of what we call today a Ponzi scheme. That is how the US Federal Government intends to run the debt up to $20 trillion by 2016 and $70 trillion in the years after that. It doesn’t matter whether Obama is re-elected or Romney takes his place. Business will continue as usual.

Although some economists would like to continue enjoying the benefits of the illusion, by continue to borrow to fund government liabilities and social programs, the truth is that the limit on how much the US can borrow is rapidly approaching its end. Why? Because in order for this Ponzi scheme to work, there have to be crazy investors who agree to bailing out the US every time it raises its debt ceiling. If the investors slow down or stop the flow of cash, Ponzi scheme collapses. That is where we are today.

The financial collapse of the US is a great segway to learning how the US government has for many years attempted to prevent this very same collapse and how it will continue to prevent it in the future. That is the  third component of the illusion.

War and conflict have always been multi-headed monsters. For one, they are responsible for destroying lands and murdering innocent people, but they also accomplish a second goal: justify the existence of the military industrial complex. However, a third goal is often overlooked. Wars and conflict are excellent tools to keep populations distracted, while financial and political crimes are committed. The current unrest in the Middle East that just so happens to coincide with the deepest financial crisis since the Great Depression is not a coincidence at all.

The people who control western governments — including the US — know this. In fact, they’ve used wars and conflict abroad to carry out radical changes at home. Hitler, Mussolini, Franco and Pinochet did it, and so has every single US president since at least 1929.

Whenever the United States runs out of lenders, or it publicly recognizes it cannot longer meet its obligations, who exactly will come to its rescue? No one. The only two choices that the US will have then are two visible ones and one card in the sleeve. The US will have to either declare itself bankrupt or exponentially hyper-inflate its currency, a policy it has been incrementally employing since 1913.

It seems very clear that the US government will not declare itself bankrupt, because it would mean that its creditors — China, the centralized banking system, Saudi Arabia and so on — will seek to claim their piece of the American pie. So, it is likely the US will continue hyper-inflating its currency, but at a faster speed. This will not be a solution, but a strategy to delay the collapse. Either way the country will collapse. The difference will be something like what is explained on CrisisHQ.com. “Economically, the first option would feel like a heart attack and the second option like terminal cancer.”

Once the hyper-inflation smokescreen no longer works, the US managers will resort to the plan they’ve been tuning up for at least half a century: open-ended war. The scenario of perpetual war as a tool of control was exploited throughout the 20th century in every single corner of the planet. From the Balkans to Nicaragua to the Middle East. The result is always the same: the confused sheeple support the candidate that shows a stronger position towards the ‘foreign threat’; that imaginary aggressor that seeks to destroy their imaginary lives.

Hitler was able to gain almost total support from the German people after fabricating the Reichstag fire. In 2001, the US government did the same. It lit up two landmarks of the American tragedy and with that opened the door to the perpetual state of war into the 21st century. That state of war gave way to the Homeland Insecurity and the growing Police State. As Saman Mohammadi puts it in his article 7 Reasons Washington’s Grand Counter-Terrorism Myths Persist In The Face of Evidence, “the doctors of reality construct mental traps and dead-ends in order to contain the conversation of contested political events and issues within the parameters of the U.S.-Israeli counter-terrorism paradigm.” The American Reichstag worked just fine.

So what to do about all this? First, understand that there is no political solution to this illusion. As shown at the beginning of this article, the establishment political parties will always find a way to rig the rules to impose their will. If government were really a solution or part of the solution, we would all be much better off than we are today. Voting for the lesser of two evils will not do anything to improve things. As long as there are public servants who do not fear the people, but who feed on them, there won’t be a solution to the problem. Second, the real solution starts with education, and then with involvement of those who saw the light and decided to walk towards it. It is necessary that the 5 percent multiplies 10 fold.

Education takes time and so does a mass awakening. Unfortunately, sometimes only a ground-shaking collapse like the one we are about to have is able to wake large masses of people up. Since the collapse seems almost inevitable, it is everyone’s duty to continue educating family members, neighbors and friends so the collapse can be prevented by exercising massive pressure over the political class. At the same time, those who are awake must prepare themselves for the collapse by becoming independent from the controllers who have been increasing the heat under all of us for the last century.

The meaning of preparing will vary depending of who you are and where you live. The common denominator for being prepared is self-reliance. Being able to determine one’s own present and future is the strongest weapon against the collapse and against the ruling class. Help your relatives and neighbors to leave the mass mind control plantation system and to become intellectually and physically independent. Help them wake up from the illusion they live in.

European Central Bank to Gain control of 6,000 banks in Euro zone

By LUIS MIRANDA | THE REAL AGENDA | AUGUST 20, 2012

The European Central Bank will “supervise” 6,000 banks in the euro area, including savings banks and regional German public banks, but the degree of direct supervision may vary depending on the banks and the involvement of other regulators.

The German newspaper Handelsblatt reported in its Friday edition that sources from the European Commission (EC), the European Union’s executive, wants the ECB to gain supervision of euro zone banks and not only those included in the European Stability Mechanism (ESM), the EC confirmed today.

With the proposal, the EC faces the German Government, as Chancellor Angela Merkel said the EU summit in late June that it is only necessary that the ECB monitor the 25 largest banks in the euro area, that is the ones considered to be in the ESM system.

Community spokesman Internal Market and Financial Services, Stefaan De Rynck, said today that the EC is still working on the proposal, which will be presented around September 11, but that a single monitoring system should apply the common rules consistently throughout the Union Bank and all financial actors. This is the bankers attempt to turn a supposed financial rescue into a financial power grab, as it was detailed in the memo of understanding (MoU).

“We have seen in the past that systemic risks can arise from banks that are not mentioned much in the media and suddenly become systemic, so it is difficult to define what is a large bank, which is a systemic bank, so we have to ensure that the union bank supervisory system to be able to cover all the banks,” he said.

However, De Rynck said it remains to be seen how this principle is articulated with respect to the types of banks and all institutions of the euro zone. What is clear is that the European Banking Authority (EBA) will have a key role alongside the ECB to play in safeguarding the unity and coherence of the single market, he added.

A European official said today that evidently supervisors have the necessary human resources to engage in this system and said it also left open the possibility that the mechanism will get to countries that are not part of the euro zone. The new supervisory tasks will have to be approved unanimously by the 27 member countries in the case of the ECB and by qualified majority in the EBA.

The same source pointed out that, obviously, to talk about “all banks” also includes savings banks and regional public banks.

A Request from De Guindos

The economy minister Spain has been one of the most outspoken politicians who is pushing for a complete surrender of sovereignty to the European bankers. He believes that the European Central Bank’s intervention must be strong and without limit in order to bring about relief to the pressure exercised by the sovereign debt that all European nations are faced with. De Guindos thinks that more centralized power could be the solution to this crisis, even though the current banking policies created by central banking institutions are ones responsible for the current crisis.

The Spanish Minister of Economy and Competitiveness Luis de Guindos, said that the intervention of European Central Bank (ECB) to ease market pressure on Spanish debt must be strong and that there should not be a set limit to amounts or durations.

In an interview with Reuters, the minister has indicated that such interventions “can not be put limit or can not be explicitly explained; not in the amounts of money that will be used not in the length of time the intervention will take” to not detract the effectiveness of the aid which aims to dispel doubts about the euro zone. That is exactly what needs to be avoided. Giving the banks a blank check without limitations for action or time frame is all they want and need to carry out their agenda further.

Regarding the way in which the monies received by Spain and how they will be used, De Guindos explained that these decisions will be made by the finance ministers of the euro countries and the EU in a meeting to be held in the second week of September. He said that by then the Governing Council of the ECB will have to explain how it plans to run the program to buy debt in the secondary market.

Countries in trouble with sovereign debt expect that the ECB will act on the secondary market,where investors already exchange issued debt by buying short-term bonds and without exercising its role as a preferred creditor, which would drive away the other investors and raise the risk premium.

The interventions of the ECB “should not make explicit neither the amount nor a time limit and as noted by the ECB itself, it must take into account the problems caused by the preferred creditor status”, said an European source. In his opinion, the attitude of the ECB has opened “a very positive scenario” for the Spanish government, as the entity recognized the pressure on Spanish debt markets largely responding to something that goes “beyond the domestic politics ” and has seen fit to intervene to correct it.

By this statement, most European nations expect the ECB and the EU to intervene in every way possible, whenever it is necessary, instead of them looking for a domestic solution, which is how the debt problem could be solved more easily, by simply rejecting the payment of debt created by the banks on behalf of the Euro zone countries, which is what has turned the debt problem into a ticking bomb. Iceland did it and it is now enjoying a less painful recovery. Greece and Spain did not have the guts to face the bankers and reject their fraud, so they still suffer the consequences of working along the rubber barons of financial fraud.

Spain’s debt will increase by 23,000 billion Euros until the end of 2012

By LUIS MIRANDA | THE REAL AGENDA | AUGUST 6, 2012

You are not going crazy. 23,884 billion euros is approximately what Spain’s debt will be in the short term should the country continue to adopt the European banking policies. The reason for this is that the current and soon to come newest austerity and indebtedness measures will prolong the country’s painful crawl towards bankruptcy while inflating the government’s debt to more than 23,000 billion euros. That’s why the actions taken so far by Mariano Rajoy’s led government beg the question about what will be the realistic impact of a financial bailout of the Spanish government, that right now is estimated to be at 300 billion euro. The answer is that any impact will simply get Spain more in debt that it is today.

As it happened in Greece, the negotiation of debt for both the banking system and the Spanish government are just window dressing moves to extend the losses and accumulate power in the hands of the banking elites, to which we are all slaves to, according to the main stream media. The above mentioned debt is the debt that Spain will have to incur into to finance its government for the remaining of 2012. More debt will be added to this in the long term, if the European Banking System decides to rescue Spain, and will turn the obligation impossible to pay.

The more than 23,000 billion is something like the 27.8% of the total amount scheduled for the year. To that amount must be added several billion more in terms of short-term debt — 3 months to 18 months. If things do not change much, long-term debt will be at the highest rate in recent years, according to a statement issued by the president of the European Central Bank (ECB), Mario Draghi.

Friday, the Treasury debt placed at two, four and 10 years were at interest rates ranging between 4.8% and 6.7%. The Director of Studies of Catalunya Caixa, Ramon Roig, explained that “the rate at which the interest rate has been placed is practically the same as that listed on the secondary market.” So if the Spanish debt in this market rally that began Thursday consolidates (the 10-year bond stood at 7.2%), it will become more expensive for Spain to fund. “It will surely make it more expensive to finance the borrowing, which will complicate our life,” said Miguel Angel Bernal, a professor at IEB.

A total of 1062.1 million of debt was placed Thursday into a two years, 4.8% (the previous was 5.3%), with 1,024.4 million due to four years at 6.1% (in the previous one was at 5,6%) and 1045.8 million to 10 years at 6.7% (previously 6.5%).

According to the Spanish Treasury, last June (latest data available) there were 611,992,000 of outstanding government securities with an average life of 6.2 years. The average cost, according to the same statistics, is 4.1%, one of the lowest in recent years.

The Economy Ministry confirmed that as in previous years, there will be no long-term auction given the holiday period in mid August. So the next test for the State are 21 and 28 of this month, when more debt will be put out. That short-term debt is easier to place with investors, among other reasons, because in a hypothetical situation where the money is taken from creditors, a debt reduction may remain outside, say the analysts. This is what happened, for example, in Greece.

Miguel Angel Bernal warned yesterday that “the key time is October because there are many debt maturities.” According to the Treasury, that month will see the renovation of more than 20,000 million for the long term and some 5,000 million for the short term. In addition to these maturities, the State must finance the deficit generated during the same period. “If you spend more than you take in, as in a family, it becomes a deficit and that deficit needs to be financed, which normally results in more debt,” said Roig.