Spain Plunders 90% Of Social Security Fund To Buy Its Own Debtby Tyler Durden
Jan. 04, 2013
CNN's Stelter Attacks Fox News For Covering Story Of Illegal Immigrants Raping Girl At School
Gross: TSA Agent Gropes Disabled Boy In Front of His Mother At DFW Airport
'Sorry, Not Sorry': Leftists Celebrate Surge In White Working Class 'Deaths Of Despair'
Antifa Thugs Beat Down & Arrested For Attacking Trump Supporters At Huntington Beach Rally
NSA Whistleblower Says NSA Spied On Congress, The Supreme Court And Trump
With Spanish 10Y yields hovering at a 'relatively' healthy 5%, having been driven inexorably lower on the promise of ECB assistance at some time in the future, the market has become increasingly unsure of just who it is that keeps bidding for this stuff. Well, wonder no longer. As the WSJ notes, Spain has been quietly tapping the country's richest piggy bank, the Social Security Reserve Fund, as a buyer of last resort for Spanish government bonds - with at least 90% of the €65 billion ($85.7 billion) fund has been invested in increasingly risky Spanish debt. Of course, this is nothing new, the US (and the Irish) have been using quasi-government entities to fund themselves in a mutually-destructive circle-jerk for years - the only difference being there are other buyers in the Treasury market, whereas in Spain the marginal buyer is critical to support the sinking ship. The Spanish defend the use of pension funds to buy bonds as sustainable as long as it can issue bonds - and yet the only way it can actually get the bonds off in the public markets is through using the pension fund assets. The pensioners sum it up perfectly "We are very worried about this, we just don't know who's going to pay for the pensions of those who are younger now," or those who are older we would add.