Via translation from La Vanguardia …
Economy Minister, Luis de Guindos, said Tuesday that Spain has submitted projects worth around 60 billion euros to the President of the European Commission, Jean Claude Juncker, who aims to mobilize 315,000 billion euros.
Guindos stressed the priorities for the Government are energy interconnections, transport and R & D. Juncker said the plan is a “key initiative” of the new Commission, “with the appropriate times, quickly and effectively.”
Spain wants €60 Billion. How much will France want? Greece? Portugal? Germany? How far will €315 Billion go?
The answer is not far. As I commented on November 24, Juncker’s €315bn EU Slush Fund is €299bn Sleight of Hand Magic.
Juncker’s €315bn EU Slush Fund looks like this.
95% Leveraged Magic, 5% Fund
- €16bn from the EU budget
- €5bn in guarantees from the European Investment Bank (EIB)
- €299bn is magic.
Supposedly, private money will come up with €299bn based on €5bn in guarantees.
Of course someone has to administer this action plan. So Juncker unveiled a new “investment advisory hub” run by “financial professionals” with direction from the European Commission and EIB.
After padding their own pockets, the group will decide which projects to undertake, no doubt based on kickbacks, bribes, and political favoritism to friends.
To make the deal even sweeter for their political cronies, the EU will offer a “first-loss” guarantee, where the EU money would absorb any initial investment losses in an effort to “crowd in” private investors looking for more secure upside.
Given that it’s all funny money anyway, I have a question: Why not provide €50bn in guarantees raising €2.99 trillion in the process?
Out of a grand total of €16bn from the EU budget, Spain seeks €60 Billion.
Taking into account Juncker’s leveraged magic, if Spain got every penny of what it requested, it would get about €3bn from the EU budget. Leverage would provide the other €57 Billion.
That really going to work?
Mike “Mish” Shedlock