Madrid Stock Exchange Index vs. Spain 10Y Note Yield, Bankia Was In Penny Land (Charts)

Yesterday, the Madrid Stock Exchange General Index (MADX) hit a new low of 616, and the Spanish 10-year government bond yield hit an intraday high of 6.70%, which is essentially testing the 11/25/2011 crisis high of 6.729% pre-LTRO. The sovereign debt crisis, banking crisis (Spanish banks are sitting on an estimated $150 - 180 billion of bad loans), 50% youth unemployment, austerity measures, and Greek exit/euro contagion risk are not helping to boost Spain's economy or its tax base. Maybe taxes from internet gambling and a "EuroVegas" will save Spain. Look at the inverse relationship between MADX and the Spanish 10-year government bond yield.

Madrid Stock Exchange Index vs. 
Spanish 10-year Government Bond Yield (

Spanish 10-year Government Bond Yield (

I see that Bankia hit penny land yesterday morning. Is the EUR18 billion bailout plan by Spain's government to inject government bonds into Bankia for equity (which they can then park at the ECB as collateral for cash) going to happen (1, 2, 3, 4, 5)? Subordinated bonds (junior bonds) at other Spanish banks (BBVA, Banco Santander) have had a bad month as well.

Bankia hits a low of 0.96 (Bloomberg)

Oh this might come in handy: Spanish Bank and Sovereign Debt Risk Monitor (Maturity Schedule, Yields, CDS).

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