A very gloomy view on Spanish economy

[emmi]

http://www.mail.com/int/business/markets/1492832-long-spain-take-financial-heat.html#.1272-stage-hero1-6

[djk99]

We had a few 'good discussions' about this on here a few months ago....initially triggered by the problems Bankia were having. Sadly, it all seems to be following the predicted course. There a lot of Madrid politicians with their heads buried firmly in the sand, but, to be honest, I'm not sure much could be achieved even if they were to take a proactive approach. If the Northern European countries can avoid weakening their position by bailing out what they consider to be the non taxpaying PIIGS we're on our way to some form of 2 tier Europe at best.
Ironically, it may be Spain's regional governments, who eventually tip Madrid's delicate financial balance. Spain's seventeen semi-autonomous regional governments -  spend 40%  of all public money. Most are overspent and traditional  money markets will be  closed to them when loans mature and must be refinanced. Valencia became the first region to formally request a bailout, followed by Murcia - Catalonia, Andalucía, Castilla La Mancha - more are joining the queue.
Andalucia is struggling to find enough cash to fund it's 19 hospitals, and  60,000 public jobs, one in four of the local governments workforce,are at risk.
Earlier this month, Cristobal Montoro, Spain's economy minister held a meeting to set new limits on regional spending. The meeting, which had already been boycotted by Catalonia, the largest contributor to Spain's economy with debts of €42bn, prompted a walkout by Andalucia's representative, while the economic head of two others, Asturias and the Canary Islands, voted against the measures - So from a local perspective, we appear to have locked horns with the Madrid administration at an early stage and will be on their hit list for some punitive reaction.

[Voldermort]

You are very right, although the central government does have some cash to play with, even at this stage, most have overlooked the debts of the regional spendthrift governments. Most has been wasted/nicked/trousered etc over the years, but now they cant afford the medicine bills and are finding it hard to get supplies. Some councils havent been able to pay their staff for over a year.

   Sadly will only get worse

[kevin2003]

Señor Rajoy still have one trick up his sleeve.This case here is before his Attorney General at the moment:

http://tinyurl.com/7dc5uad

The temptation to think big and legalise Cannabis must be enormous.

There would be licenses for it's production and licenses for the development of non-tobacco delivery systems.There would be income and capital tax streams from production through to consumption.Thousand of jobs would be created in agriculture and production.As other European countries slowly follow,Spain will already have established itself as the dominant market supplier.

There is potentially a pot of billions here.

It wouldn't of course cure all Spain's ills but it would scare the wolf from the door.

Oh,and the Americans won't be too pleased........nor the Moroccans come to think of it.

[butchbuildersinc]

You are very right, although the central government does have some cash to play with, even at this stage, most have overlooked the debts of the regional spendthrift governments. Most has been wasted/nicked/trousered etc over the years, but now they cant afford the medicine bills and are finding it hard to get supplies. Some councils havent been able to pay their staff for over a year.

   Sadly will only get worse


Its no different in the uk.
When our glorious leaders decided to give less money to the councils and cut back , the councils decided that they could no longer afford to employ all employees and made many redundant and lots lost their jobs. Now a council near me that literally got rid of hundreds of people WITH FAMILIES are spending 19 million pounds to smarten up the town for a better shopping experience. Bunch of morons!!
WHAT ABOUT THE POOR SODS WHO CAN NO LONGER FEED THEIR FAMILIES!!!
Rant over   just     phew!!!

[PeterHeirman]

For a start banks could half (or at least decrease by 35%) the asking price of their real estate - then foreigners could start buying. Now all those with money/savings are sitting on the side line until the price drops 35%.
The foreigners with money are those that have saved money the last15- 20 years instead of buying real estate as second home. These foreigners with money are not in a rush like their predecessors - moreover they don't need a loan.
Foreigners with money are scarce: Norwegians (North Sea oil), Swedish, Germans, Swiss and Belgians (the country with the highest savings per head in Europe / World).

Of course life in Spain needs to maintain the level of comfort and not falling back to a third world country as else Florida is more interesting to buy a place in the sun.

[butchbuildersinc]

For a start banks could half (or at least decrease by 35%) the asking price of their real estate - then foreigners could start buying. Now all those with money/savings are sitting on the side line until the price drops 35%.
The foreigners with money are those that have saved money the last15- 20 years instead of buying real estate as second home. These foreigners with money are not in a rush like their predecessors - moreover they don't need a loan.
Foreigners with money are scarce: Norwegians (North Sea oil), Swedish, Germans, Swiss and Belgians (the country with the highest savings per head in Europe / World).

Of course life in Spain needs to maintain the level of comfort and not falling back to a third world country as else Florida is more interesting to buy a place in the sun.
absolutely spot on.
Ive always said that money is not given but earn t and Spain needs to learn not to bite the hand that feeds them, and that is tourism!!

[fifi]

Hi Butchbuilders, hows life with you? Nice to see you posting again.