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It is not a liquidity issue, it's a solvency issue".
People realized that Ireland does not have a liquidity issue and not much of a solvency issue either," said Brian Devine, economist with NCB Stockbrokers.
Now, maybe there's a solvency issue, and bond vigilantes will turn on America over that — although of course this keeps not happening either to us or to anyone else with their own currency.
"This is no longer about liquidity; it's a solvency issue," said Stephen Jen, a former economist at the International Monetary Fund who is now a strategist at BlueGold Capital Management in London.
"Dubai shows us that what we are now facing is a solvency issue, not a liquidity issue," said Jonathan Tepper, a partner at Variant Perception, a research house in London that has been outspoken on the debt problems facing European economies.
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At that point, we may indeed have a resource constraint, or an inflation constraint, but not a national solvency issue.
So, what we need is a set of sensible solutions to the long-term solvency issue -- a surgical approach, rather than simply taking a whack at the retirement age.
But now, he added, it "would be difficult to anticipate" that the buyers and Bell could come up with a new agreement that would both resolve the solvency issue and meet with bank approval.
"In other words, a bailout package addresses the liquidity issue much more than the solvency issue," Citigroup said.
By embracing an ad-hoc approach to member solvency issues, the EU risks enabling a domino effect of defaults across its membership, much like the American ad-hoc approach led to the cascading wave of defaults that led to the Lehman bankruptcy.
That followed a warning in March from the finance ministry that a third of the 45 cajas faced solvency issues.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com