Cristiano Ronaldo's butt could belong to the ECB

Despite the fact that I don't like soccer, it was brought to my attention something very funny: the European Central Bank (ECB) could become the new owner of soccer players Cristiano Ronaldo and Kaka. In 2009, the Spanish soccer club Real Madrid was granted a credit of EUR 76.5 million with Caja Madrid, later integrated in Bankia, to recruit both superstars. With Bankia's bailout, the  ownership of both players could end up in the hands of the ECB. The result of this bailout, the entities within Bankia, including Caja Madrid, have lost all their financial assets. Among these assets, Bankia owned an asset securitization fund called "Corporate Assets Madrid V, FTA", which included the credit lent by Caja Madrid to Florentino Perez's club for the transfer of Kaka and CR7. This fund was given by Bankia as collateral so that it could be eligible to participate in the ECB's weekly liquidity auctions that have bought Bankia the much needed liquidity to be able to continue operating. At the present time, the fund no longer belongs to Caja Madrid.

The agreement signed between Real Madrid and Caja Madrid for the reception of the loan, was dated June 23, 2009 and maturing on July 3, 2014, after payment of three installments of 25.5 million on July 3, 2012, 2013 and 2014, and is payable by image rights of both players, which always was the basis on which Florentino Perez justified the return on their huge investment.

Under the present circumstances there are two reasons why the ECB could take over the rights of Cristiano Ronaldo and Kaka: one is that Real Madrid soccer club committed a non-payment of amounts agreed, and two, that Bankia turns insolvent. The club will try to avoid the first one at all cost in spite of the spectacular revenue fall this season. The second one is more than likely should the outflow of Spanish bank depositors.

Back when the deal was closed, the (educated) public opinion was outraged by the favorable conditions of the loan since it coincided with the closing of the credit tap to individuals and small businesses. Today, this agreement may turn against Florentino Perez if the situation spirals into chaos, which right now can not be excluded. And if it does, would have to see what happens with both players, which could ultimately end up changing team and joining the European Central Bank, or more accurately, they could appear as an asset on the central bank's balance sheet.

  
The New York Times puts ACS, the construction company whose president is also Florentino Perez, as an example of the problem of private debt in Spain, which is even worse than the government debt (sovereign) that threatens to place the country in a decade of stagnation. The newspaper cites the case of ACS, "a company with a debt of 9,000 million, double its current market value, and tucked into a frenzied campaign to sell assets and to distance himself from the situation affecting the Spanish economy." "Just as he has used debt to accelerate his company’s remarkable growth, he has borrowed heavily to sign prominent Real Madrid players — from the British star David Beckham to the current Portuguese sensation, Cristiano Ronaldo."

So there you go guys. Some central banks used to back their currency with gold, some others back it with soccer players that make covers on teen magazines.