Missing from the articles that I read on today’s ECB presser except for ZeroHedge, of course, is that Draghi admitted that the ECB did not discount Spanish T-Bills the required 5% for “B” rated countries.
Technically, Spanish banks need to post an additional €16.6bn in new collateral. These banks are very weak and probably insolvent at this point, so Draghi pulled a bureaucratic trick from up his sleeve. He referred the matter to an ECB audit committee that will assess proper collateral use.
Spain cannot be allowed to fail, because it will take the whole eurozone down with it. Since it refuses the ask for a bailout, the ECB has no choice but to deploy any and all tricks it has to maintain the solvency of the banks and of Spain itself.
Those banks will eventually begin failing, but not today.