Spain Sinks Deeper into Recession

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This topic contains 37 replies, has 13 voices, and was last updated by Profile photo of GarySFBCN GarySFBCN 4 years ago.

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  • #57117
    Profile photo of angie
    angie
    Spectator

    In the third quarter Spain’s economy contracted further for the 5th consecutive time but the true figures were somewhat masked by consumers trying to beat the VAT rise in September. With this news and that of Spanish unemployment rate now at 25.1% is Rajoy just turning a blind eye or what, or is he trying to bluff it out but for what reason? Is it because he just isn’t up to the task?

    http://www.telegraph.co.uk/finance/financialcr … rter.html#

  • #113215
    Profile photo of Anonymous
    Anonymous
    Participant

    Oh please Angie, he certainly is up to the task; he is just very, very smart; and knows the only way to make Spaniards change is to make them suffer more and more until they realize it’s time for a collective mentality change. It will come, believe me!!….. it will take five years more but in the meantime the smart guys are moving into position ๐Ÿ™‚ ๐Ÿ˜ฎ ๐Ÿ˜ฎ ๐Ÿ˜ฎ

  • #113216
    Profile photo of GarySFBCN
    GarySFBCN
    Participant

    Not that it matters much, but Edward Hugh said that Spain in in a depression, not a recession. I’m not sure what definition he is using, though.

  • #113217
    Profile photo of angie
    angie
    Spectator

    I’m glad you think he is up to the task UBEDA, the trouble is I don’t think it looks that way to outsiders with his posturing or non action. Is he any more liked now than Zapatero was? I think most new leaders of any country or Political sway always promise change but in reality it’s often more of the same! ๐Ÿ˜•

  • #113218
    Profile photo of DBMarcos99
    DBMarcos99
    Participant

    There are actually glimmers of better results ahead.

    For instance Investors (the financial speculators unfortunately) Return to Spain as Surplus Reaches Record
    http://www.bloomberg.com/news/2012-10-30/spain-narrows-central-government-budget-deficit-to-4-39-.html

    This week Ferrovial reports profits of 488 million (63% of sales outside Spain)
    http://www.thecorner.eu/2012/11/ferrovial-reports-488-5-million-euro-profit/

    Companies that deal in part with exports or foreign buyers are starting to gain interesting contracts and in many cases are producing ever better profits. Which is why Spain is now posting current account surpluses for the first time in Euro history..

    There are no shortage of prospective new opportunities in Spain either: Amazon creating 600 jobs in madrid – TravelLodge to open 100 new hotels by 2020 – France to buy military planes from the Airbus site south of Madrid – Toys R Us to create 1000 jobs this Christmas – Mercadona keep expanding and taking on staff.

    Of course for many the situation is gloomy. Many either have to take the bullet and find work elsewhere (Germany, Austria, Switzerland and Saudi Arabia have all signalled they want skilled workers in various fields from Spain) or live off the grandparents’ pensions).

    But although there are plenty of gloomy reports, there are some appearing now that state the economy will turn the corner in 2013 and enter growth in 2014. Let’s hope so, a certain segment of the Spanish population have suffered enough.

    As to Rajoy’s performance- I have to include myself in the large group who can’t understand his actions, and thought he was totally not up to the job (although remember he inherited incredible problems). But maybe he has a master plan that is coming to fruition? Vamos a ver…

  • #113220
    Profile photo of DBMarcos99
    DBMarcos99
    Participant

    Great optimistic message on Spain – Or a different view on Spain

    http://www.youtube.com/watch?v=XUFMxmIoFRc&feature=youtube_gdata_player

    A total propaganda piece of course (and already sour comments reminding us of house repossessions are below the video) but a lot of the facts presented may surprise many.

  • #113235
    Profile photo of Anonymous
    Anonymous
    Participant

    @dbmarcos99 wrote:

    Great optimistic message on Spain – Or a different view on Spain

    http://www.youtube.com/watch?v=XUFMxmIoFRc&feature=youtube_gdata_player

    A total propaganda piece of course (and already sour comments reminding us of house repossessions are below the video) but a lot of the facts presented may surprise many.

    I have seen this on another expat site, posted on the same day, any connection?

  • #113236
    Profile photo of Anonymous
    Anonymous
    Participant

    There seems to be more to Rahoy than one could have believed – he never looked credible but since his election he seems a tower of strength and its can be contagious -it will be a great achievement if he pulls Spain through -and it stays together !

  • #113237
    Profile photo of peterhun
    peterhun
    Participant

    He has a magic wand to make Spain’s problems disappear?

    His “Tower of Strength” will banish the problems to the land of Nod?

    Lord, help me.

    http://wallstreetsectorselector.com/2012/11/stalling-in-spain/

  • #113239
    Profile photo of katy
    katy
    Spectator

    @fern999 wrote:

    @dbmarcos99 wrote:
    Great optimistic message on Spain – Or a different view on Spain

    http://www.youtube.com/watch?v=XUFMxmIoFRc&feature=youtube_gdata_player

    A total propaganda piece of course (and already sour comments reminding us of house repossessions are below the video) but a lot of the facts presented may surprise many.

    I have seen this on another expat site, posted on the same day, any connection?

    Of Course not ๐Ÿ˜† ๐Ÿ˜† ๐Ÿ˜† ๐Ÿ˜†

  • #113240
    Profile photo of DBMarcos99
    DBMarcos99
    Participant

    @katy wrote:

    @fern999 wrote:
    @dbmarcos99 wrote:
    Great optimistic message on Spain – Or a different view on Spain

    http://www.youtube.com/watch?v=XUFMxmIoFRc&feature=youtube_gdata_player

    A total propaganda piece of course (and already sour comments reminding us of house repossessions are below the video) but a lot of the facts presented may surprise many.

    I have seen this on another expat site, posted on the same day, any connection?

    Of Course not ๐Ÿ˜† ๐Ÿ˜† ๐Ÿ˜† ๐Ÿ˜†

    Like you Katy, I have the right to post on several forums. Not sure what the point is here? (unless of course none of the facts and opinions in the video can be contradicted – although I’m surprised no-one’s said anything about their mention of the banking sector).

  • #113242
    Profile photo of katy
    katy
    Spectator

    Anyone seen the worse than expected unemployment figures out of Spain this morning. Over 2% more (4% in mรกlaga province) ๐Ÿ™

  • #113244
    Profile photo of DBMarcos99
    DBMarcos99
    Participant

    I always have difficulty linking those high figures with the Spain I visit regularly, which tends to be Madrid and the north where the unemployment rate is half that of Andalucia. I have to admit though that on a recent visit to Valencia (where I was lucky enough to gain 2 website projects for the new year) the people I met, although busy on their projects, stated that national demand was generally not good so they were looking at international openings.
    Then I read something like this, and it makes you wonder
    http://www.davidjackson.info/2012/25-of-the-local-economy-is-black.htm

    Still, at least this means we donโ€™t have the social unrest youโ€™d expect with a 35% unemployment rate. Everyone is working, they just arenโ€™t bothering to pay any taxes. Understandable really, when the average Spaniard knows that if he/she does pay taxes, it just goes into the back pocket of the nearest politician.

    Is he right or wrong?

  • #113247
    Profile photo of Chopera
    Chopera
    Participant

    @dbmarcos99 wrote:

    I always have difficulty linking those high figures with the Spain I visit regularly, which tends to be Madrid and the north where the unemployment rate is half that of Andalucia. I have to admit though that on a recent visit to Valencia (where I was lucky enough to gain 2 website projects for the new year) the people I met, although busy on their projects, stated that national demand was generally not good so they were looking at international openings.
    Then I read something like this, and it makes you wonder
    http://www.davidjackson.info/2012/25-of-the-local-economy-is-black.htm

    Still, at least this means we donโ€™t have the social unrest youโ€™d expect with a 35% unemployment rate. Everyone is working, they just arenโ€™t bothering to pay any taxes. Understandable really, when the average Spaniard knows that if he/she does pay taxes, it just goes into the back pocket of the nearest politician.

    Is he right or wrong?

    He’s right, to an extent. I suspect many of the jobs previously done cash in hand by illegal immigrants are now being done cash in hand by Spaniards. However a builder did tell me the other day that the warehouses all charge IVA these days, whereas a few years ago they acepted cash. Apparently they are trying to crack down on the black market.

  • #113248
    Profile photo of Chopera
    Chopera
    Participant

    @angie wrote:

    In the third quarter Spain’s economy contracted further for the 5th consecutive time but the true figures were somewhat masked by consumers trying to beat the VAT rise in September. With this news and that of Spanish unemployment rate now at 25.1% is Rajoy just turning a blind eye or what, or is he trying to bluff it out but for what reason? Is it because he just isn’t up to the task?

    http://www.telegraph.co.uk/finance/financialcrisis/9644198/Spain-sinks-deeper-into-recession-in-third-quarter.html#

    It’s because he’s not in charge of the situation. If you are not in charge of your currency then you are not in charge of your economy.

  • #113249
    Profile photo of angie
    angie
    Spectator

    Rajoy looks far from being a ‘Tower of Strength’ to many people, he keeps stalling on his eventual bailout request ( I can’t see how he thinks Spain doesn’t need the bailout), Master Plan ? I don’t think so, Muddled plan more like, I don’t think he knows the best way forward which makes investing in Spain for now decidedly risky or ‘money is no object if I lose it all’.

    Of course Rajoy and his elite inner sanctum of cohorts and friends, milk what they personally can, give jobs to the boys, and screw most of the populus without addressing the important issues to restore some credibility into the country. But only my opinion, not ๐Ÿ˜†

  • #113357
    Profile photo of angie
    angie
    Spectator

    Some questions for you:

    To what extent do posters here think the austerity measures are in fact deepening the recession in Spain and elsewhere?

    Are there any figures for how much extra money it’s costing Spain and elsewhere just to Police these austerity protests?

    Should Spain and other countries put more emphasis on growth with projects, and cut back the austerity measures?

    Do you think if nothing is done that mass civil unrest will increase to levels we’ve not seen so far?

    ๐Ÿ™„ ๐Ÿ™„

  • #113358
    Profile photo of Anonymous
    Anonymous
    Participant

    @angie wrote:

    Some questions for you:

    To what extent do posters here think the austerity measures are in fact deepening the recession in Spain and elsewhere?

    To a very large extent.

    On the other hand, the last half of a century has been a dream due to the demographic advantages in Europe and elsewhere. Now we go back to a normal situation where people only spend what they earn. It will be a painful decade and after that an austere future.

  • #113360
    Profile photo of Anonymous
    Anonymous
    Participant

    @angie wrote:

    Some questions for you:

    To what extent do posters here think the austerity measures are in fact deepening the recession in Spain and elsewhere?

    Are there any figures for how much extra money it’s costing Spain and elsewhere just to Police these austerity protests?

    Should Spain and other countries put more emphasis on growth with projects, and cut back the austerity measures?

    Do you think if nothing is done that mass civil unrest will increase to levels we’ve not seen so far?

    It would be best if Spain left the euro right now and adopted the Peseta so that the Peseta could devalue and reflect the true state of the Spanish economy and enable the Spanish Government to print money and set interest rates to suit its economy. Staying in the Euro will just mean more government debt with very little to show for it and in any case Spain will have to leave the Euro, one way or another eventually so why bother with all the costs of staying in the Euro.

    Spain should face reality now and leave the Euro immediately and flatten and bring down the economy and let the banks go bankrupt. Keeping aloft the zonbie banks is just what the Japanese did and it has only led to twenty years of deflation and austerity. Only when there has been a total economic collapse can a new beginning take place, an economic recovery based on real money and real demand rather than the funny money and fake demand generated during the last boom.

  • #113361
    Profile photo of logan
    logan
    Participant

    For a different more optimistic view of the Spanish crisis see this video. I don’t necessarily share the optimisim but it is a contrary view to Jake’s gloom and doom.
    I actually believe in the coming decade most western capitalist countries will settle in to a modest growth pattern of around 1% per annum. Property values will remain at current levels or slightly below especially in Spain.
    That is how economies used to behave, we just have to get used to it again after years of advanced development.

  • #113362
    Profile photo of Anonymous
    Anonymous
    Participant

    @logan wrote:

    For a different more optimistic view of the Spanish crisis see this video. I don’t necessarily share the optimisim but it is a contrary view to Jake’s gloom and doom.
    I actually believe in the coming decade most western capitalist countries will settle in to a modest growth pattern of around 1% per annum. Property values will remain at current levels or slightly below especially in Spain.
    That is how economies used to behave, we just have to get used to it again after years of advanced development.

    http://www.youtube.com/watch?feature=player_embedded&v=XUFMxmIoFRc

    I read somewhere that a Japanese survey revealed that the British produced some of the most influential technological developments of the 20th century but that does not alter the fact that Britain is a third rate feudalistic country with no economy that is run by the Eton public school mafia. Likewise there are multinational companies that are based in Spain that are doing rather well, based on bribery and corruption of course and on the cartels that they operate, however that does not alter the fact that Spain does not have an economy, its unemployment rate is racing towards the 50% mark and that its economy is getting worse by the day and is fast becoming a third World country.

  • #113367
    Profile photo of GarySFBCN
    GarySFBCN
    Participant

    To what extent do posters here think the austerity measures are in fact deepening the recession in Spain and elsewhere?

    That is what I believe. Spain’s crisis wasn’t debt. It was unemployment. But the global meltdown highlighted other problems in Spain. One example of idiotic austerity: Government employees get 14 paychecks each year – one each month and one extra for summer and one extra for Christmas. The extra paychecks are not extra salary – they just divide the annual salary by 14. So what does Rajoy do? He cuts the extra paycheck for Christmas, as a cut in salary. What does this do? I eliminates the largest workforce in Spain from spending money for Christmas. This will have a huge negative impact on retail and food sectors of the economy and even more, it will lead to further cultural depression. This was an idiotic thing to do and it was done in the name of austerity. Another example is privatizing health care in Madrid. If the idiots there would just read about health care in the US, they’d know the private systems cost a lot more than socialized systems.

    Are there any figures for how much extra money it’s costing Spain and elsewhere just to Police these austerity protests?

    I’m sure the cost is huge.

    Should Spain and other countries put more emphasis on growth with projects, and cut back the austerity measures?

    Spain yes. Other countries I’m not so sure. Greece doesn’t need growth when so much of the economy if underground. There’s no one-size-fits-all solution but the problem solvers are approaching this as one big problem. Spain isn’t Greece. Ireland isn’t Spain.

    Do you think if nothing is done that mass civil unrest will increase to levels we’ve not seen so far?

    I think it is going to get worse and unless Spain can rid itself of PP, Spain will lean toward fascism.

  • #113372
    Profile photo of Anonymous
    Anonymous
    Participant

    Are there any figures for how much extra money it’s costing Spain and elsewhere just to Police these austerity protests?

    Besides using tear gas etc. How & why should it cost them extra ? The Police etc are already on the payroll and have to be paid protest or no protest !!!!

  • #113375
    Profile photo of angie
    angie
    Spectator

    Thanks for answering the points raised Gary ๐Ÿ˜‰

    Not sure what your problem is shakeel, what don’t you understand about costings? Every strike in every country has a larger cost implication than normal Policing etc. Large scale riots cost countries huge amounts, when the Tottenham riots were costed in the UK, and the UK Uncut costings were done, it added huge amounts to stretched budgets.

    I’m only asking on here if anyone has an idea of what this costs in Spain, this is not normal Policing, clearly you have no idea of the situation ๐Ÿ˜ก Try and be constructive dear boy ๐Ÿ˜†

  • #113376
    Profile photo of Anonymous
    Anonymous
    Participant

    Hi Angie,
    I do not think that I have a problem it was a question that comes to mind. As I said besides using tear gas, rubber bullets and all sundry that get used in mostly a very barbaric action taken by riot police.

    The police or riot police are already there on the payroll so riots or no riots they are paid. So this cost remains constant. It is not that an state will suddenly employ/train extra staff & when the riots are over sack them with compensation etc for loss of emplyment.

    The biggest cost is salaries in any kind of organisation. Perhaps you or the forum users can point me in the right direction as to what the extra cost would be.

  • #113377
    Profile photo of katy
    katy
    Spectator

    Overtime ๐Ÿ’ก

  • #113378
    Profile photo of Chopera
    Chopera
    Participant

    I can only guess that there may be some extra policing costs because they will receive extra payments for being present at riots (extra shifts, overtime for those not scheduled to be on duty when a riot hits, etc) but I suspect the main costs are due to the clean up afterwards. Which might be one reason why riot police use the tactic of channeling riots into closed off areas. On the other hand, as someoneone was pointed out to me, if you knock a building down and then build it up again it counts as economic growth. So maybe a few riots might improve Spain’s GDP ๐Ÿ˜• ๐Ÿ˜• ๐Ÿ˜•

  • #113379
    Profile photo of DBMarcos99
    DBMarcos99
    Participant

    There are demos almost every week in London, that have to be organised and controlled by the police. Last week it was a TUC march and demonstration against the cuts, this week it’s Middle-East issues
    http://www.standard.co.uk/news/london/hundreds-descend-on-kensington-to-protest-over-violence-in-middle-east-8320574.html

    I don’t think the policing cost will change that much. Ok, there may be overtime payments, but generally the police are merely transferred from their normal roles.
    What does have an effect though is on world opinion and their confidence in investing in Spain. Probably this latest set of demos and strikes won’t have too much of an impact (the London riots last year stayed in peoples’ minds longer), but it could be damaging if the strike is repeated. Would TravelLodge continue their plan of opening up 100 new hotels in Spain if these strikes continue to take place? A point that Celia Maza de Pablo made in the Evening Standard

    http://www.standard.co.uk/comment/comment/spain-is-suffering–and-now-it-is-hurting-itself-8319495.html

    Spain is now more dependent than ever on external financing. With these strikes we are sending a message abroad of instability and insecurity at a time when we should be restoring confidence. The trips made by different ministers to meet investors in the City, and the tests conducted by independent agencies on Spanish banks, are useless if the images offered on the BBC are of riotous street protests.

  • #113380
    Profile photo of katy
    katy
    Spectator

    London has always had demos for as long as I can remember. When I used to walk down Whitehall to work there was one almost every day. The UK gets the demos they cannot do in their own country.

  • #113381
    Profile photo of DBMarcos99
    DBMarcos99
    Participant

    @katy wrote:

    London has always had demos for as long as I can remember. When I used to walk down Whitehall to work there was one almost every day. The UK gets the demos they cannot do in their own country.

    Well yes, all capital cities have regular demos, as far as I know. I’ve been visiting Madrid since the late 80s and nearly always there is some demo going off, whether it be Cuban dissidents or Asturian miners having their say. During Zapatero’s government there were often huge demos by Rajoy and the PP lot, often on religious issues eg abortion or gay marriage.

    I was in Madrid last week, and after going for a nice morning walk (this was a Sunday) I had to cross Puerta del Sol to the south side to get to my accommodation. I quickly saw that the road was completely blocked, and I could hear shouts and whistles. Oh no, I thought, not another Indignados demo that will block movement for hours. It turns out it was an annual herding of sheep through the centre of Madrid, and was over fairly quickly…

  • #113386
    Profile photo of angie
    angie
    Spectator

    This one’s for you shakeel, and for the one or two who don’t think it costs more to Police strikes and demonstrations ๐Ÿ˜‰

    The bill for London’s Tottenham riots came to ยฃ133 million, that’s on top of their normal pay etc so yes it does cost more, don’t forget compensation and clean-up payments too. BTW This does not include the bill for the mass protest by UK Uncut in London when students etc protested against Bankers and Corporate tax evasion.

    Spain like Greece has constant strikes and demonstrations due to austerity measures, there has to be an increased added financial burden on the State over and above their normal pay for normal duties, I can’t find figures for Spain’s extra Policing, wonder why, lack of transparency again? Hence the inclusion in my questions, someone may know I suppose ๐Ÿ™„

    Shakeel I hope this helps, did Spain plan for X number of demonstrations this year at the beginning of the year, did they plan for the extra clean-up and possible compensation payments, I doubt it, it certainly did not budget for it out of normal pay and their warehouse for rubber bullets which will have to be replaced. The trouble is this could just be the tip of the iceberg, things might turn a lot uglier later which will inevitably cost more to Police etc ๐Ÿ™„

  • #113392
    Profile photo of Anonymous
    Anonymous
    Participant

    So we agree that the additonal cost will be made up of overtime, extra cleaning & replenishment of rubber bullets.

    If we agree to the the above than it must be good for the economy. The over time will be spent in Bars, ferias, VAT contribution, cleaning contractors & light arms industry who I suppose manufacture the rubber bullets. I am not being flipent.

  • #113393
    Profile photo of angie
    angie
    Spectator

    And other things shakeel like compensation payments, are they good for the economy, oh, and despair is that good too ๐Ÿ˜†

    So what you seem to be saying is that it’s ok to have these strikes and demonstrations which cause a lot of damage and suffering, people get hurt, their businesses suffer whilst their windows and doors etc are being repaired, hospitals have to cope with injured people including Police etc, and all the rest, simply because more work, VAT and bullets will be provided, wacky or what? ๐Ÿ˜ฏ

    Do you really think overtime will be spent in bars for example and not on food, utilities, trying to keep alive for many in Spain, paying the missed mortgage and rental payments perhaps etc I’m not sure you still quite understand what’s good for the economy is not to have civil unrest which costs the State millions in extra Policing and emergency services, this money could be used constructively in the economy even help pay off some Spain’s debts ๐Ÿ™„

    So do you now agree it does cost more to cope with demonstrations and not just out of normal pay as you thought and budget? ๐Ÿ™„

  • #113396
    Profile photo of Anonymous
    Anonymous
    Participant

    I am not or was not saying any of the above. However it seems that with any action taken by a citizen it have a plus & minus implication to a society. No I have not re invented the wheelside.

    My was a simple question as to how does civil strive cost extra money y punto.

  • #113397
    Profile photo of angie
    angie
    Spectator

    Well, now you know shakeel, oh, and more minus than plus ๐Ÿ˜†

    Mine was one of several simple questions too which some have answered here ๐Ÿ™„

    Do you mean ‘invented the wheel’? ๐Ÿ˜†

  • #113401
    Profile photo of GarySFBCN
    GarySFBCN
    Participant

    Not content with the centuries-old looting of the New World that allowed Spain to prosper, Rajoy is now asking former colonies to ‘invest.’

    Spain asks former Latin American colonies for investment to help it through financial crisis

    CADIZ, Spain โ€” Spainโ€™s prime minister on Saturday joined its king in asking former Latin American colonies to help the EU nation overcome a deep financial crisis by channeling investments its way.

    Prime Minister Mariano Rajoy said Spain had invested heavily in Latin America when it suffered a crisis 10 years ago, and now that the roles were reversed, he called upon those nations to increase their participation in his countryโ€™s economy.

    http://www.washingtonpost.com/business/spain-asks-former-latin-american-colonies-for-investment-to-help-it-through-financial-crisis/2012/11/17/eb70cfb6-30e5-11e2-af17-67abba0676e2_story.html

  • #113402
    Profile photo of Anonymous
    Anonymous
    Participant

    Besides the role turn around. If Spain makes itself effecient, productive, reduce corruption, make the legal system work, show accountability, lower taxes, reward enterprise and not treat investors as some one that can be milked from day one. ( sorry if I have said on this before ) It does not have to go out to world with a begging bowl & use the blackmail of returning favours.

    It shows the dire position that it is in !!!!

  • #113403
    Profile photo of GarySFBCN
    GarySFBCN
    Participant

    Besides the role turn around. If Spain makes itself efficient, productive, reduce corruption, make the legal system work, show accountability, lower taxes, reward enterprise and not treat investors as some one that can be milked from day one.

    And I believe that ALL of this can be achieved without austerity measures that directly or indirectly hurt low and middle-income people.

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