Investors Fear Mounting Losses in Portugal as Second Rescue Looms!

• The charade continues. Greece is about to be rescued. Yeah right! Everything is ok. Go back to sleep. Calamity or successful resolution of the Eurozone sovereign debt crisis? You decide!
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  Investors fear mounting losses in Portugal as second rescue looms! 
  By Ambrose Evans-Pritchard, http://www.telegraph.co.uk/ 
  Portugal is fighting a losing battle to contain its public debt and may be forced to impose haircuts of up to 50pc on private creditors, according to a top German institute.
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  A report for the Kiel Institute for the World Economy said Portugal would have to run a primary budget surplus of over 11pc of GDP a year to prevent debt dynamics spiralling out of control, even in a benign scenario of 2pc annual growth. “Portugal’s debt is unsustainable. That is the only possible conclusion,” said David Bencek, the co-author, warning that no country can achieve a primary budget surplus above 5pc for long.
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  “We won’t know what the trigger will be but once there is a decision on Greece people are going to start looking closely and realise that Portugal is the same position as Greece was a year ago.” Yields on Portugal’s five-year bonds surged on Thursday to a record 18.9pc, reflecting fears that the country will need a second rescue from the EU-ECB-IMF Troika. Three-year yields hit 21pc.
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  Antonio Saraiva, head of the Confederation of Portuguese Industry, said the first loan package of €78bn (£65bn) did not acknowledge the vast liabilities of public companies, which have been shut out of global capital markets.
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  … for more click here!

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