The geat Spanish crash.

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This topic contains 20 replies, has 12 voices, and was last updated by Profile photo of DBMarcos99 DBMarcos99 3 years, 11 months ago.

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  • #57185
    Profile photo of katy
    katy
    Spectator

    On BBC2 at 7pm this evening an hour long documentary.

    Paul Mason travels to Spain to investigate how this once thriving economy has become the latest casualty of the Eurozone crisis.

    Greece, Ireland and Portugal have all received massive bailouts with strict conditions. But Spain is different. One of the largest economies in the world, for nearly twenty years “cool Espana” meant cutting edge architecture, the world’s best restaurants and the magic of Barcelona Football Club. Spain was a European success story.

    For BBC Two’s award-winning strand This World, Mason reveals how the transition to democracy after Franco’s dictatorship created a financial and political system that left the country vulnerable to catastrophe when the world economic crisis struck in 2008. One of the keenest advocates of the European single currency, Spain is now the biggest victim of the Eurozone crash with youth unemployment running at more than 50%.

    Interviewing key players, including former prime minister Felipe Gonzalez and European commissioner Joaquin Almunia, Mason reveals how Spain’s extraordinary credit and construction boom has collapsed, leaving millions facing poverty and the politicians still bickering about a massive potential bail out.

    Suspect it will be more of the same ole but worth a look :mrgreen: Why everyone seems to pinpoint Spains woes starting with the credit crunch I have no idea. Spain was already failing re.property, they just built too many. A lot of Estate agents on the costas were closing down from about 2006!

  • #113975
    Profile photo of GarySFBCN
    GarySFBCN
    Participant

    Spain was already failing re.property, they just built too many. A lot of Estate agents on the costas were closing down from about 2006!

    katy, that looks interesting.

    Just to clarify, it was businesses in Spain that built too many properties, no? Certainly there was corruption in some local officials, but was there any large-scale corruption by the central government?

    And if there had not been a global meltdown, would those properties have been sold to foreigners, for less than expected, but having more of a ‘soft landing’ effect on the economy instead of a crash?

  • #113976
    Profile photo of angie
    angie
    Spectator

    Some clips on here katy:

    http://www.bbc.co.uk/programmes/b01pgqpn

    Looks more interesting than ‘Strictly’, Paul mason doesn’t normally pull his punches ๐Ÿ˜‰

  • #113987
    Profile photo of DBMarcos99
    DBMarcos99
    Participant

    Seen 45 mins already, and I have to say it describes the reasons quite well (although it’s made a few howlers, and concentrates a bit much on Brit expats – they weren’t to blame for the crash).
    A combination of a over-heated economy, too much spending by local govts who had the power now to do so, lax lending by the cajas, and surging prices in the housing sector. A classic bubble that would end up in the current deflation. Perhaps the point they needed to stress more was that a lot of people chose to work in the lucrative construction sector instead of other areas.

  • #113990
    Profile photo of Anonymous
    Anonymous
    Participant

    I watched the programme in its entirety, but I don’t think an hour was long enough to explain such a major event properly. I didn’t quite believe that the Lehman’s crash had so little to do with Spain’s problems though.

    The economist who explained, twice, and with a wink each time that the Euro couldn’t survive without Spain was quite right, but they didn’t explore whether Spain could survive without the Euro.

    I believe it could, and don’t we all have a perfect example to quote from?

  • #113992
    Profile photo of Anonymous
    Anonymous
    Participant

    I didn’t watch it as I could guess what it was all about and don’t need to be reminded ๐Ÿ™

    My Dad did watch it though and said that at least they said that local cajas were very much to blame. At last, some truth about the corruption at local level which spread and spread.

    When is anyone going to be brave enough to say that lots of properties were sold with 130% mortgages to immigrants who didn’t pay deposits and then got ‘cash for furniture’. They’ve all gone home and left a heck of a lot of mortgage debt for others to suffer. The President of Ecuador can say that they’ll welcome their immigrants back home with open arms (of course they will with all their cash from Spain). Yes some immigrants were hard working and lost out in the ‘crisis’ but others played the corrupt bank game and made a lot of money to send home to build a house which they now have ‘for free’. Ecuador have said that they won’t allow Spanish banks to chase their people back at home…. that’s because they know how many have left debt in Spain for the Spanish to pay for.

    Shame.

  • #113997
    Profile photo of angie
    angie
    Spectator

    I watched it and what was interesting was the sheer waste of public monies on huge eye-catching buildings that are not in use nor can be paid for in places like Valencia which came out as really in dire straights financially. I also don’t think we’ve seen the last of huge austerity demonstrations and the intensity/violence will escalate especially if Spain is forced to beg for bailout and be run by those in Brussels/Germany.

    It highlighted well the growing unemployment and the many educated Spaniards looking abroad for work.

    I got the impression that the emphasis was that Spain should devalue but cannot and the likes of George Magnus and the Spanish Economic Professor say the only way was to leave the Euro making Spain more competitive again. ๐Ÿ™„

    Not forgetting the Spanish blackmail card, ‘help us, keep applying sticking plasters for ever, or we will bring down the whole Euro thing’ scary stuff! ๐Ÿ™„

  • #113998
    Profile photo of katy
    katy
    Spectator

    There was a hug demo in Madrid yesterday, against health service cuts.
    Angie said:
    I got the impression that the emphasis was that Spain should devalue but cannot and the likes of George Magnus and the Spanish Economic Professor say the only way was to leave the Euro making Spain more competitive again

    That is the problem with the eurozone, many critics say one size doesn’t fit all and was always going to happen to some countries.

  • #114001
    Profile photo of Chopera
    Chopera
    Participant

    @dbmarcos99 wrote:

    Seen 45 mins already, and I have to say it describes the reasons quite well (although it’s made a few howlers, and concentrates a bit much on Brit expats – they weren’t to blame for the crash).
    A combination of a over-heated economy, too much spending by local govts who had the power now to do so, lax lending by the cajas, and surging prices in the housing sector. A classic bubble that would end up in the current deflation. Perhaps the point they needed to stress more was that a lot of people chose to work in the lucrative construction sector instead of other areas.

    …and the banks. One of the things that imediately struck me when arriving in Spain was how everyone with a degree ended up working in a bank. The banks paid most, had the best convenios (e.g. obligatory summer timetables) and “gave the most job security”.

  • #114003
    Profile photo of Chopera
    Chopera
    Participant

    @katy wrote:


    Suspect it will be more of the same ole but worth a look :mrgreen: Why everyone seems to pinpoint Spains woes starting with the credit crunch I have no idea. Spain was already failing re.property, they just built too many. A lot of Estate agents on the costas were closing down from about 2006!

    Exactly – the problem isn’t the crash, it was creation of the bubble in the first place. To some extent what we’re seeing now is the best thing about the euro – without it the government would simply devalue and keep the scam going. Instead they are being forced to diversify into other sectors. At some point I’m hoping that it will dawn on them that Spain has to liberalise its economy and create genuine competition, so people are rewarded (rather than be punished) for starting up companies and doing business. The alternative is for Spain to leave the euro.

  • #114005
    Profile photo of DBMarcos99
    DBMarcos99
    Participant

    @chopera wrote:

    @katy wrote:

    Suspect it will be more of the same ole but worth a look :mrgreen: Why everyone seems to pinpoint Spains woes starting with the credit crunch I have no idea. Spain was already failing re.property, they just built too many. A lot of Estate agents on the costas were closing down from about 2006!

    Exactly – the problem isn’t the crash, it was creation of the bubble in the first place. To some extent what we’re seeing now is the best thing about the euro – without it the government would simply devalue and keep the scam going. Instead they are being forced to diversify into other sectors. At some point I’m hoping that it will dawn on them that Spain has to liberalise its economy and create genuine competition, so people are rewarded (rather than be punished) for starting up companies and doing business. The alternative is for Spain to leave the euro.

    Yes we’re already seeing signs of people getting on and starting up businesses ( for example read http://monocle.com/magazine/issues/59/starting-again/ ) and the export sector is rising admirably to the challenge. Hopefully too, the investment planned by the auto companies will not only create jobs, but encourage other multi-nationals to Spain. It’s claimed here that 73,000 jobs are to be create by the car industry http://www.theolivepress.es/spain-news/2012/12/04/boost-for-spanish-car-industry/ but we’ll believe it when we see it. But yes, if the govt keeps raising taxes then they could end up snuffing the recovery out. Which is probably why they are resisting the bailout option – no point taking that and then see the economy get hit further by further tax increases demanded by the Troika. Spain leave the Euro? It’s still an option, but I suspect now they’ll remain in it, despite the fact they could recover a lot faster outside. I used to be 65% of the opinion that Spain would leave the Euro soon, but I’m now around 35% ๐Ÿ˜‰

  • #114011
    Profile photo of Anonymous
    Anonymous
    Participant

    @angie wrote:

    Some clips on here katy:

    http://www.bbc.co.uk/programmes/b01pgqpn

    Looks more interesting than ‘Strictly’, Paul mason doesn’t normally pull his punches ๐Ÿ˜‰

    Thanks for the link, I’ll watch that a bit later on!

  • #114025
    Profile photo of Anonymous
    Anonymous
    Participant

    The points I got:

    – they built sports complexex next to Torrevieja for 400K Euros that nobody use and Science palaces for 1.1 billion Euros in Valencia that
    they cannot afford to maintain.
    – on the other hand they make kids study in plastic containers because they cannot afford to build schools.
    – the biggest mistake made after Franco was to give too much freedom to the local governments because they wanted to satisfy the Basque and catalonians but also wanted to dilute the freedom given to basques and catalonians by giving freedom to everybody.
    – nobody paid attention to the local banks who were abusing the lending procedures.
    – banks were ruled by people who knew s**t and by people with vested interests to lend.

    Main point:

    – s**t hasn’t really hit the fan, there is lots of pain to come.

    On the other hand I am looking forward to enjoy 2 weeks of good weather over Christmas in Marina Alta.

  • #114028
    Profile photo of katy
    katy
    Spectator

    Well summed up…have a good time ๐Ÿ˜€

  • #114016
    Profile photo of Anonymous
    Anonymous
    Participant

    The situation in Spain is not just getting worse by the day, it is getting worse by the hour. Who on Earth in their right mind would want to live in Spain, let alone buy a property there? It is obvious that the pain and misery will continue to get worse and accelerate such that in the end even the most die-hard residents in Spain will consider upping sticks and moving out of the country.

  • #114041
    Profile photo of DBMarcos99
    DBMarcos99
    Participant

    @jakesuper wrote:

    The situation in Spain is not just getting worse by the day, it is getting worse by the hour. Who on Earth in their right mind would want to live in Spain, let alone buy a property there? It is obvious that the pain and misery will continue to get worse and accelerate such that in the end even the most die-hard residents in Spain will consider upping sticks and moving out of the country.

    I must have been very lucky when I visited end of October. The Spanish people I met in Valencia, and the expats I met in Madrid were all quite busy in their jobs and doing well. Ok, that’s anecdote and I understand that the jobs situation is very harsh in Valencia – the people I know are of a certain age where they have their niche. The one complaint I heard most was that taxes were biting hard – if Rajoy’s foolish enough to increase taxes further he may find that many will leave to work remotely.

  • #114045
    Profile photo of angie
    angie
    Spectator

    ‘s**t hasn’t really hit the fan, there is lots of pain to come’, totally agree, that’s what most rational people on here and elsewhere think too flosmichael ๐Ÿ˜‰

    I felt sorry for those poor children having to use containers as a school while one of the great Valencian/Spanish white elephants stood unused and unpaid for, would make a good school/university perhaps ๐Ÿ™„

    Have come across several people today locally who watched that programme, said how interesting it was, and all said, they ‘didn’t know things were that bad in Spain’ ๐Ÿ™„

    Enjoy your break ๐Ÿ˜›

  • #114046
    Profile photo of logan
    logan
    Participant

    I have just watched this program via the bbc i player (VPN). It’s already out of date having been made this summer but the essentials are correct, with nothing we have not discussed on this forum before.

    I was struck how determined the Spanish people in the film are to help themselves. That’s what comes from a lack of welfare.
    In the UK people in their position would sit back and contentedly live off state benefits, housing allowances, family allowance et al. and moan it was not enough.

    That’s why I love Spain, it’s the people stupid.

  • #114047
    Profile photo of DBMarcos99
    DBMarcos99
    Participant

    @logan wrote:

    I have just watched this program via the bbc i player (VPN). It’s already out of date having been made this summer but the essentials are correct, with nothing we have not discussed on this forum before.

    I was struck how determined the Spanish people in the film are to help themselves. That’s what comes from a lack of welfare.
    In the UK people in their position would sit back and contentedly live off state benefits, housing allowances, family allowance et al. and moan it was not enough.

    That’s why I love Spain, it’s the people stupid.

    Blimey, you must have been on the pop Logan – or I have. I agree 99% with what you’ve put. There are still those of us in the UK trying to get ahead by working instead of just taking the benefits, but it seems we’re in a minority.

  • #114035
    Profile photo of Anonymous
    Anonymous
    Participant

    “Have come across several people today locally who watched that programme, said how interesting it was, and all said, they ‘didn’t know things were that bad in Spain “

    When you say local you mean local Brits or Local Spaniards ??? How wonderful it is to be an Ostrich.

  • #114036
    Profile photo of angie
    angie
    Spectator

    shakeel, the Brits I was talking about were in England, I still don’t think many here are aware of Euro wide problems, not even Spain’s, hence their reactions to seeing the programme ๐Ÿ˜‰

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