RAJOY apparently got a pretty  sweet deal at the Brussels summit yesterday: Europe will capitalize troubled banks directly and not through the government, thus easing the sovereign debt conundrum; the non-seniority of the funds is confirmed, and Europe is open to use the rescue funds in the future to buy sovereign bonds.

It's gonna take some time to see if this works out. So far the markets, which started sending the Spanish bond yield down remarkably this morning, seem to have changed their minds, and the spread with the German bund is again over 500 basic points.