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After almost five years of lies, denials and creative accounting the Spanish banking system and the government is finally coming clean. The true extent of their financial mismanagement is truly staggering. This coming Friday will reveal further bank stress tests showing the banks are close to collapse..
Some of us have posted on here over the years the true extent of the disgraceful behaviour of banks and government during this financial crisis. In my opinion Spain is a rogue state in parallel to a third world banana republic.
When the USA, UK, France and Germany had a similar problem with their banks they came clean, put up their hands and accepted the disaster which confronted them. The government acted and took on the burden of debt which in large part ballooned their deficits. The medicine was swallowed.
Spain on the other hand has prevaricated, ducked and dived and has been in public denial for years. I think that illustrates why everyone should think very carefully before they trust, invest or move to live in the country where such dishonesty is an accepted part of the culture.
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First of all, yet again, you are not differentiating between the cajas savings banks (and Bankia which is an aggregation of the cajas), and the normal commercial banks like Santander and BBVA. I realise you have strong views on the cajas, as we gather you made the mistake of using them, but their situation has been known for many years. There have been plenty of warnings on various message boards. On the other hand, Santander or BBVA are well capitalised (indeed they have now been required to be more so than other international banks, to an extent that they have sold off a couple of chains in south America). For the last 4 years, every few weeks, you get the envious-of-Santander lot trying to smear their name on English talkboards, yet they go on making a profit whilst RBS or Lloyds keep losing money. That is a fact. They are not having a bail-out. If Santander (or BBVA) do get a bail-out this Autumn I shall apologise here and leave the forum! Don’t worry I don’t expect you to make the opposite pledge, as I know you’re just tring to smear Spain and promote your French interests.
When the USA, UK, France and Germany had a similar problem with their banks they came clean, put up their hands and accepted the disaster which confronted them. The government acted and took on the burden of debt which in large part ballooned their deficits. The medicine was swallowed.
I don’t know what’s been happening in the States or France, but I guess you’ve not seen the banking scandals that have come to light recently in the UK, involving your “clean” banks. Libor-fixing and money laundering. Step up to the mark HSBC, Standard Charterd, RBS and Barclays! But hey, you hate Spain, so obviously dodgy things can only happen in Spain! Wise up!
Actually the Telegraph article you’ve linked to, doesn’t seem to be very comprehensive. It’s claiming that 100 billion Euros will be needed on Friday, whereas the Spanish business press have been giving figures more in the 30-35 billion Euros range. Now it’s quite possible that the press in either country are producing incorrect guesses. We shall see on Friday which nation’s press is more accurate – and if the figure is over 100 billion that will still count as a win for the Telegraph team. -
Incidentally, can anyone explain why the Spanish Ibex has risen so much in recent weeks (up from 6900 to around 8100)? Even to me it seems very strange. Ok, so the international tourism figures have been high – not so internal tourism- and companies that have survived the recession can be expected to improve their performance as the economy improves. But even so, there seems to be something missing from the equation, as times are still tough.
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When various posters on here ‘M’ including me are critical about Spain and Spanish property matters and after all it is ‘Spanish Property Insight’, we are told we obviously hate Spain and want to see the country collapse etc which is a total over-reaction. 🙄 Using the words ‘hate Spain’ is not reflective of our liking for the countryside, it’s food, culture, climate, it’s locals, it’s beaches and mountains etc 😛
We’ve all had our experiences with Spain, the good and the bad, and there appears to be a lot more of ‘bad’ simply because Spain never got to grips with either it’s corrupt out of control property market, nor it’s corrupt financial industry, it’s own Government Ministers are also talked of as in an elite group of corruption which help one another land the ‘boys’ jobs.
Logan is right that Spain has been in denial for years, where dishonesty is rife especially with ‘B’ money, property matters (illegal builds etc), it’s had this culture that if you pay someone you can get something through the system. Much of this does not nor could not happen in such a big way in the UK and other countries.
Why hasn’t Spain ever addressed this properly, why hasn’t Spain honestly regulated this property gravy train? No doubt because those in power did not want it to end and why not, one could assume backhanders are involved.
If Spain got to grips with regulation, speedy court procedures, transparency, and lower transaction costs then, confidence would return to the market.
The rise in the Ibex was probably down to lower borrowing costs and the likelihood of a bailout coming IMO, markets factor these things in. 🙄
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If Spain got to grips with regulation, speedy court procedures, transparency, and lower transaction costs then, confidence would return to the market.
so what do you think of the money-laundering scandals, as well as the Libor-fixing scams from years ago, that came to light in British banks this summer, Angie? Do you think that shows a transparent clean banking system?
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‘M’ of course the UK’s banking system needs fixing, I couldn’t agree more, It’s disgusting about the Libor scandal and fraudulent mortgages (liars loans) were given out en-masse, the MP’s expenses etc, it doesn’t make me proud of the UK, there is corruption in all Government too.
On the French thing, we have several friends who moved to France to live/retire, they know their property market is bumping along and quiet, but they don’t seem so stressed about it as many Brits are in Spain, and I think it’s because that’s the French market, it’s different. Also, they say the locals just go about their business as they’ve done for years, a more laid back and rural kind of life I think. Not the huge unsold urbanisations to contend with as in Spain/Cyprus/Portugal etc 😛
I would be posting regularly if there was a dedicated website called UK Property Insight, or UK Financial Scandal Insight, there’s a lot still to come out of the woodwork no doubt 🙄
No-where is perfect but as this website is about Spain and all of us have some experiences good and bad it gets discussed here for hopefully the benefit of others 😉
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I agree Angie. No-where is perfect but some people, ourselves included, have had shocking times due to the uncontrolled corruption in Spain. It’s still going on because heads are well and truly in the sand. No one in power wants it to stop because they’re on the make themselves. In my husbands little town it’s all related, the Mayor, his family, their extended family, their friends…… they can now drive around in their little Renaults or whatever pretending to be ‘suffering due to the crisis’ but we all know that the Merc is at the country estate….
The cajas are what are dragging Spain down. They went completely uncontrolled and someone at the Bank of Spain must stand up and just say ‘sorry’. If they are bailing the banks out, those who creamed off millions in commision for flogging dodgy loans should be held accountable. There are too many people living very comfortably where they should really be in prison and all their assets stripped. They won’t because they shunted it out of their name into that of their wife or daughter etc. ages ago. What really shocked me in Spain was that it was mainly thought of as acceptable. People working who owed the tax office nearly half a million but he’d put everything into his wifes name so he couldn’t be touched. A sort of ‘Robin Hood’ who’s robbing their own people?
A friend, who is a solicitor, works in a Spanish Caja. I asked him why they don’t just hold their hands up and say ‘blimey, we messed up let’s sort this out’ but he said that it’s true but they didn’t want to be the first to admit it. It’s a real ‘latin’ thing I guess?? The Cajas are bankrupt and owe billions, just tell it like it is….. don’t faff around trying to sort something out when honestly the only thing is a a bail out. Each caja probably has a million repo properties each? Add then add the millions of the developers loans…. how much per Caja? It’s shocking and laughable that it’s just dragging on.
The Spanish people are suffering whilst their politicians are desperately trying to save their friends the bankers, because come on, who are the ‘bankers’ at the Cajas….. friends of people in influence. Our hateful bank manager is a bank manager because her husband is (!). She can’t use the bank computer system and seems to be there to wear nice clothes and go out for coffee. My six year old has more of a clue than she does. They’ll all walk away from this property mess with their pockets well lined and a portfolio of all the best repo properties. Shameful.
Spain could be a wonderful place, their are some lovely people there….but there really needs to be some more sort of sense of what is right before the mess can really be sorted out. Too many people are still earning too much money and have too much power in little towns to make it worth their while stopping the corruption.
Europe needs to force their hand. If they get a bail out their financial system needs to be taken over by Europe and controlled by Europe. It won’t happen. The Spanish people need saving and the rest of the world is going to help the Spanish system help their banker and politician friends.
oh well.
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I repeat once again I have no agenda to smear Spain or even promote my French interests. I actually am very fond of both countries. To write otherwise is just silly, wrong and misguided.
I make no criticism of the people or the country other than the financial and political system for which incidentally most Spaniards themselves have total contempt.
What I was trying to get across is the dishonest way this banking scandal has been dealt with both by banks themselves and politicians. Bad debts have been moved off balance sheets, international loans obtained with inflated property values and statements for years by governments and central bankers that the situation was containable and no bail out was needed. The aim was simply to calm the bond markets and retain investor confidence.
It’s not just the caja’s who have contributed to this disaster. Santander and BBVA have suffered huge losses but the difference is they have had greater resources to sustain it.
The Spanish banks collectively have bad or doubtful debts of €169 bn. that they have come clean with so far. Their none performing assets are grossly over valued in current terms and much of that reason is because of collateral support for previously loans from the ECB.
Spain is faced with dire problems. €32bn of maturing international debt this autumn, bankrupt regions and a banking system that requires as a minimum a €70bn. cash injection.
Rayjoy is resisting help because he knows he will lose control of the country. It’s inevitable, very necessary and about time.
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Also let us not forget that thousands of Spaniards and ex-pats have been swindled out of their life saving by being duped into buying “investment” bonds when in fact their savings were used to buy junk bank bonds!
If Rajoy was in the private finance world he would be charged with trading whilst insolvent 😆
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@katy wrote:
Also let us not forget that thousands of Spaniards and ex-pats have been swindled out of their life saving by being duped into buying “investment” bonds when in fact their savings were used to buy junk bank bonds!
If Rajoy was in the private finance world he would be charged with trading whilst insolvent 😆
I’m afraid a large chunk of the banking is sector is also trading whilst insolvent, and falsely declaring their asset values in order to roll over debt. Something that any director in the private sector could find themselves criminally charged for. Of course the rules don’t apply to banks and politicians though.
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@DBMarcos99 wrote:
For the last 4 years, every few weeks, you get the envious-of-Santander lot trying to smear their name on English talkboards, yet they go on making a profit whilst RBS or Lloyds keep losing money. That is a fact. They are not having a bail-out. If Santander (or BBVA) do get a bail-out this Autumn I shall apologise here and leave the forum!
Awww, your poor Spanish ego. Spain is bust and getting bailed out, probably more than once. Its going to cost more than the banking system contributed to Spanish taxes for the last decade, just as it has in the UK.
Personally I’d like to wipe the banks out of history, there is nothing any of them have done to be proud off.
@DBMarcos99 wrote:
I don’t know what’s been happening in the States or France, but I guess you’ve not seen the banking scandals that have come to light recently in the UK, involving your “clean” banks. Libor-fixing and money laundering. Step up to the mark HSBC, Standard Charterd, RBS and Barclays! But hey, you hate Spain, so obviously dodgy things can only happen in Spain! Wise up!
Completely irrelevant to Spain, but you are obviously Spanish, so display that peculiar trait of pride blinding you to reality. UK’s BoE can help its banks recapitalise, unlike Spanish banks. Bad debts are what is going to hurt the Spanish system, 9.5% of loans are bad. Are some banks magically immune? We will see.
@DBMarcos99 wrote:
Actually the Telegraph article you’ve linked to, doesn’t seem to be very comprehensive. It’s claiming that 100 billion Euros will be needed on Friday, whereas the Spanish business press have been giving figures more in the 30-35 billion Euros range. Now it’s quite possible that the press in either country are producing incorrect guesses. We shall see on Friday which nation’s press is more accurate – and if the figure is over 100 billion that will still count as a win for the Telegraph team.
The true figure will be more than 100billion, up to 450billion maybe required in the long term. One thing for sure, you won’t get the truth in Spanish newspapers.
Incidentally, can anyone explain why the Spanish Ibex has risen so much in recent weeks
Cluessless fuckwits and money printing hopes.
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@DBMarcos99 wrote:
We shall see on Friday which nation’s press is more accurate…
I doubt that we will.
I’ll guarantee that just as we saw with Greece, it will be a series of bailouts.
Meanwhile, no one has any faith in the Spanish Government:- http://business.financialpost.com/2012/09/17/spains-banks-bleeding-cash-as-deposits-shrink/ & http://www.financialexpress.com/news/spaniards-pull-out-cash-flee-spain/997885/0 It also raises the rather prickly issue (on the property front) as who exactly is going to be underwriting mortgages for all these properties? We saw what happened in the rest of Europe and the U.S. when the banks stopped lending. Right now many banks are offering 100% mortgages on property they own and sales are not exactly brilliant to say the least. I think the notion of the politicians and banks here procrastinating is accurate, they’re just prolonging the problem, I might even argue that because of their procrastination the problem is only just about to kick off!
And I love Spain! 8)
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Spanish my arse 😉 Marcos is just a dreamer who can’t crack it anywhere. He specialises in talking up Spain and pushing his mates websites.
The rise in the IBEX looks good but when you compare that before the crash it was over 12,000 there is a lot of catching up to do. UK and USA have almost got back to former levels. The exchange rate is no indicator of economic recovery. When the Eurozone was booming the Euro was almost parity with the Dollar…think about it!!
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It’s impossible to predict an exact time frame for events like an economic crash you can only see that’s its going to happen and not in what form. As it is now countries have been pumping in more and more money which is just prolonging the agony and moving the real crash forward in time. You can see how severe the situation is when even with this money injections nothing is getting better. I just hope people are going to be civlised about it and not kill each other. Diluting the money supply and shifting the losses to the population of every country is not the right way to go.
What Spain is doing at the moment is not a nice thing since they are trying to trick other countries populace to take on their problems. Hopefully the politicians and banksters see this and let them deal with their own problems since they have their own.
Another thing I have noticed during this crisis is that most countries are lying about their trade deficits and this lying has increased a lot. If you add up all countries trade surpluses and trade deficits they should be the same and it has never been but the last few years this “lie” has increased ten folds. You can’t trick the markets forever.
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@katy wrote:
Spanish my arse 😉 Marcos is just a dreamer who can’t crack it anywhere. He specialises in talking up Spain and pushing his mates websites.
Come on Katy. We know you hate Spain and so dislike folk who can produce factual links that contradict your allegations, but “pushing his mates websites”? Given the wide range of differing links I gave here I must have a whole heap load of mates! Btw., if I wanted to push someone’s website I wouldn’t be spending time doing it here (with all respect to Mark, there are sites that gain 100000s more in traffic). Maybe the DM or Money Saving Forum.
Btw, what do you think about shares in Telefonica? I know last time you thought my tip was a bad one, but since then they’ve soared over 30%. Do you still feel they’re going to crash? Serious question btw. I also think there will be a correction downwards before they recover again, so want to get any feedback before I commit serious cash.
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In once sense I can understand Rajoy’s reluctance to accept the conditions imposed by Mario Dragi to implement the ECB’s bond purchase program.
What nation would voluntarily surrender it’s sovereignty even if the cause was completely justified. The troika’s ‘Men in Black’ have little sympathy for the nations peoples, only their mission. Once that step is taken it’s irreversible and politicians are usually not forgiven for it by their electorate. It’s being caught between a rock and a hard place and a political price will be paid whatever takes place.
In Spain’s case and in every other EU bailout the choice has been already made for them by the extent of the severe situation.
The demands made upon Greece by the these bailout conditions are in my view totally impossible to meet without the country falling into total chaos. Spain may well also be a future victim of that.However at the end of the day the case for submission to these demands has already been made and Spain has no other real choice.
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@logan wrote:
In once sense I can understand Rajoy’s reluctance to accept the conditions imposed by Mario Dragi to implement the ECB’s bond purchase program.
What nation would voluntarily surrender it’s sovereignty even if the cause was completely justified. The troika’s ‘Men in Black’ have little sympathy for the nations peoples, only their mission. Once that step is taken it’s irreversible and politicians are usually not forgiven for it by their electorate. It’s being caught between a rock and a hard place and a political price will be paid whatever takes place.
In Spain’s case and in every other EU bailout the choice has been already made for them by the extent of the severe situation.
The demands made upon Greece by the these bailout conditions are in my view totally impossible to meet without the country falling into total chaos. Spain may well also be a future victim of that.However at the end of the day the case for submission to these demands has already been made and Spain has no other real choice.
Well there is another choice (but I accept the current govt doesn’t have the mandate nor the cojones to carry it out). Leave the Euro, revert to an independent currency, and print like the UK and US have done. It’s a drastic step though, and would create an awful situation in the first few months before things improved.
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Come on Katy. We know you hate Spain and
Accusing anyone of hating Spain who blows apart your good news is wearing a bit thin. Some of us are only responding to your over optimistic views.
European shares…wouldn’t touch them. Not just risky but the xchange rate has to be factured in too. Maybe ok for those who hold euros. We do fine on the UK stocks 😀
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Incidentally, can anyone explain why the Spanish Ibex has risen so much in recent weeks
I managed to find a link that may explain why this happened, which could be of interest to investors here
http://www.fool.com/investing/international/2012/09/20/its-time-to-buy-europe.aspx
The survey showed that 43% of managers believe that Europe is the most undervalued stock market right now. ..
Already, stocks have seen big gains on that assumption. On the financial front, Banco Santander (NYSE: SAN ) has vaulted around 60% just since late July, while compatriot Banco Bilbao (NYSE: BBVA ) has also seen similarly sized gains in light of better prospects and lower Spanish bond rates. You’ll also find that optimism expressed in gains for mobile giant Telefonica (NYSE: TEF ) , which has broad exposure to markets not just in Europe but in Latin America as well.
It does look now as though values are easing back, ahead of any decision to take a bail-out or not.
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You failed to mention this paragraph in your post which is the principle reason they are trying to talking up the market. You have the same agenda. 😈
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You have the same agenda.
You are very sadly mis-taken. I’m reporting facts – and indeed had asked the question previously, why the Ibex had risen in recent weeks? This article had given a reason why.
Think about it (I know you may prefer knee-jerk jibes, but just think). If I really was trying to talk up the market, I’d surely do it when the market was down, not now when it seems to be at a mid-term peak? Besides which, it’s hardly the most-read place to “talk up” a stock market.
Why are you so upset at linking to an article that gives the reason behind historical fact? -
I’m not upset just fed up with your weak attempts to persuade readers everything will soon be tickety boo so risk your money now in a market that’s as dead as the Dodo.
If you had any knowledge of equity markets you would know up ticks do not reflect either a trend or a return of investor confidence.
Traders, tipsters and tricksters try to manufacture a market rise so they can sell in a couple of hours and profit take.
These markets do not and never have reflected economic fundamentals which as we all know are dire in the extreme.
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I’m not upset just fed up with your weak attempts to persuade readers everything will soon be tickety boo so risk your money now in a market that’s as dead as the Dodo.
With respect that is absolute bull-kaka. I was asking the question – why had the Ibex risen so much (and indeed couldn’t see why myself)? That link gave a plausible reason. I am certainly not asking anyone here to buy shares in the Ibex – My feeling is it will go back down again soon, but it’s only a feeling. My longer term feeling is that Telefonica will come out on top, but not in the short term. again I’m not asking anyone here to invest in them. Wouldn’t affect them if they did – movements are caused by big players buying/selling millions.
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I have to say ‘M’ that I agree with Logan’s comment that ‘Traders, tipsters and tricksters try to manufacture market rises in order to profit quickly’, regarding ‘tricksters’, this is exactly what happened during Spain’s property boom.
As these ‘tricksters’ were selling multiple units to so called investors and the unwary looking for one home but ending up buying two or three with the phrase ringing in their ears ‘you cannot lose’, the same tricksters had already taken their profit out of very often the same units. It was like most markets, rigged. The Spanish model was then copied and applied to Cyprus, Turkey, Bulgaria, Dubai, Cape Verde, Portugal, even the Caribbean, Brazil, Thailand, Florida to some extent. The same agents operating in Spain then, opened offices all over the World to dupe yet more naive purchasers who fell for their sales talk. It was completely and utterly out of control mass mis-selling, helped along by TV programmes and newspaper adverts.
I don’t know of one mis-selling estate agent that’s ever been successfully prosecuted and put behind bars yet, you’d have thought Spain’s Ministers would have wanted to set an example there but no! The property market has escaped prosecutions I think in comparison to some financial market racketeers:evil:
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@katy wrote:
Most stock sites have been tipping Telefonica shares for months, even The NY Times. Not sure they are a good buy now they have risen!
Well yes I agree (to an extent, I was looking long term, but want to buy cheap). Yet I seem to remember you being negative on them prior to their rise. Maybe another poster…
Of course if you’re positive their share price will fall now, you can make money on that… But that’s getting into dangerous territory, more gambling than investing. Besides which, if even the experts get the markets wrong most of the time, what chance do the rest of us have? -
I agree katy about attempts to prosecute developers with little or no outcome, but apart from the recent half-hearted attempt at McAnthony regarding mis-sold furniture packages, I’ve yet to see even one estate agent end up in Court for property mis-selling or downright scam 👿 🙄
Used to work in Banking and stockbroking years ago, could make profits for some friends who were clients, but when I ventured in for myself, lets say taking short term profits on maybe 20-25 stocks successfully, then I’d go for a couple of recommended Blue Chips and those companies would bomb or go bust so wiping out all the previous profits I’d made 😕 🙄 🙁 😉
Made me nervous, much better on our own property renovations and moves when selling on, some new builds, even our two Spanish forays ended up with profit after a lot of hard graft and dog with a bone attitude with the agent who sold them to us, (but I learnt a lot and fast about Spanish property) and good profits on some currency trading too 😉
Then Cyprus property taught me a thing or two but got out unscathed thankfully 🙄
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My feeling is it will go back down again soon, but it’s only a feeling.
Well I got that bit right! Ibex down below 8000 again. I can’t imagine anyone predicting otherwise though..
Pressure building again for Rajoy. Can he keep dithering whilst everything crashes around him? Surely he has to ask for the credit facility (ie bail-out) soon? -
Methinks the request might come soon and after Spain announces these further austerity cuts today. When they realise the knock on effect they will have on it’s people it might just trigger a request to try and placate things and focus minds elsewhere 🙄
Rajoy is just putting off the day as a show of strength I think 😉
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This may well be the best article I’ve read on this so far, and explains (perhaps) why Rajoy is so hesitate to make a decision
http://www.marketwatch.com/story/spains-chicken-game-wont-end-happily-2012-09-26
Investors, naturally enough, want the Spanish to go ahead and ask for assistance. The ECB’s intervention amounts to quantitative easing by another name. Whether that will actually help the euro-zone economy any more than it has helped the American, Japanese or British economies, where central banks have been printing money like crazy for several years now, remains to be seen.
But one thing is for sure: It helps the asset markets. Gold, equities and bonds all do well when money is pumped into the economy. There is nothing for an investor not to like about that.
But for Rajoy — the man who will have to make the call — it is almost certainly going to be a disaster. He will want to avoid a bailout if at all possible. There are three reasons….
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The entire premise of the bailout is wrong.
Instead of bailing out the banks, Spain should ask for money to invest into industries, especially in provinces that show promise such as Catalunya. Then, as the primary and secondary economies heat up in those provinces, the overall tax revenue will increase and, with more people employed, there will be less funds needed for unemployment.
Rajoy should rescind his idiot elimination of the extra paycheck at Christmas. Retail sales depends upon Christmas spending for a huge percentage of their business. Not only will retail suffer, the secondary economic sectors will suffer as well, not to mention the mental health impact to Spaniards – more depression and hopelessness.
Finally, Catalunya should be given fiscal independence such as they have Navarra.
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This article by Stefanie Claudia Müller has drawn some attention in Spain, well at least amongst my friends and colleagues:
Apparently it has appeared in the German press and many feel she has highlighted issues that are simply have not been presented by the Spanish media.
Here is the Spanish translation:
Hoy, 6 de septiembre, se encuentran en Madrid los gobiernos de Alemania y España, acompañados de un nutrido grupo de empresarios, y donde seguro hablarán sobre las condiciones para poder otorgar más ayudas financieras a España o a su sistema bancario. En los dos lados se ha elevado el tono en los últimos meses y es con gran expectación que España espera ahora la decisión que va a tomar el Tribunal Constitucional alemán, que esa sí es crucial, el día 12, sobre la conformidad o no del rescate europeo y las obligaciones derivadas para los alemanes.
En Alemania crece la critica contra la supuesta “mentalidad de fiesta” de los españoles; en España los medios cada vez son más negativos con la supuesta dureza de la canciller Merkel. Pensamos que la situación es mucho más compleja de lo que presentan ambos gobiernos y la mayoría de los medios. España no es Grecia, pero España puede ser un paciente crónico si Alemania, junto con Europa, no contribuye a solucionar sus verdaderos problemas.
España no debería recibir más dinero sin que se cambie a fondo el sistema político y económico, hoy en manos de una oligarquía política aliada con la oligarquía económica y financiera, y sin que se aumente la participación ciudadana real en las decisiones políticas. Para no perpetuar la crisis y endeudar a los españoles durante generaciones, el Gobierno español debe reformar a fondo la administración de las comunidades autónomas y los ayuntamientos, en su mayoría en bancarrota y completamente fuera de control, sometiendo a referéndum el modelo de Estado.
Este tema es la clave del futuro de España, porque las regiones, ayuntamientos y diputaciones son los responsables de los dos tercios del gasto público -234.000 millones frente a 118.000 el Estado en 2011-, excluyendo la Seguridad Social -23.000 millones-, y este gasto se realiza en condiciones de descontrol, despilfarro y corrupción totalmente inaceptables. Las razones verdaderas de la crisis del país, en consonancia con lo dicho, nada tienen que ver con salarios demasiado altos -un 60 % de la población ocupada gana menos de 1.000 euros/mes-, pensiones demasiado altas -la pensión media es de 785 euros, el 63% de la media de la UE-15- o pocas horas de trabajo, como se ha trasmitido a veces desde Alemania. A España tampoco le falta talento, ni capacidad empresarial ni creatividad. Tiene grandes pensadores, creativos, ingenieros, médicos excelentes y gestores de primer nivel.
La razón de la enfermedad de España es un modelo de Estado inviable, fuente de todo nepotismo y de toda corrupción, impuesto por una oligarquía de partidos en connivencia con las oligarquías financiera y económica, y con el poder judicial y los organismos de control a su servicio. En España no existe separación de poderes, ni independencia del poder judicial, ni los diputados representan a los ciudadanos, solo a los partidos que los ponen en una lista. Todo esto lleva también a una economía sumergida que llega al 20% del PIB y que frena la competencia, la eficacia y el desarrollo del país. Además, detrae recursos con los que podrían financiarse educación y sanidad.Las ayudas para España, igual que para otros posible candidatos de rescates, no deben ir a bancos ya casi en bancarrota y fuertemente politizados. En la CAM, el Gobierno ha comprometido 16.000 millones de dinero público en lugar de cerrarla; en Bankia, 23.000, y el Ejecutivo acaba de darle 5.000 millones urgentemente para cubrir pérdidas en vez de cerrarla, y además de forma tan extraña que despierta todo tipo de recelos. ¿Por qué se ha utilizado el dinero de los españoles (FROB) en vez de esperar los fondos de la UE? Es lícito suponer que la razón es la siguiente: los bancos no quieren que la UE investigue sus cuentas.
Control estricto y duras condiciones. Ya el caso de Grecia ha demostrado que las ayudas europeas tienen que estar vinculadas a un control estricto y condiciones duras. Esas condiciones no pueden solamente representar recortes sociales o subidas brutales de impuestos, como hace ahora el Gobierno de Mariano Rajoy con la excusa de Europa. Se tiene que cambiar más en España que cortar gasto social, que de todos modos es mucho más bajo que en Alemania, y hay otros gastos infinitamente más relevantes que se pueden eliminar. Además, los casos de corrupción resultan tan escandalosos, incluso en el propio Gobierno, que uno solo puede llegar a una conclusión: el dinero de Europa no puede ser manejado por personas tan increíblemente venales.
La pasada semana el ministro de Industria Soria -imputado también por corrupción urbanística en Canarias- acusó al ministro de Hacienda en el Consejo de Ministros de favorecer descaradamente a la empresa líder de renovables, Abengoa, de la que había sido asesor, en la nueva regulación de estas energías, que reciben más de 7.000 millones de euros de subvenciones anualmente. Y Rajoy, al que entregó una carta probatoria, ni dijo ni hizo absolutamente nada.
No puede permitirse por más tiempo este nivel de corrupción, y menos aún a 17 regiones funcionando como estados independientes, con todos los organismos multiplicados por 17, desde 17 servicios meteorológicos a 17 defensores del pueblo, con 200 embajadas, 50 canales de TV regionales en pérdida, 30.000 coches oficiales o 4.000 empresas públicas que emplean a 520.000 personas, creadas específicamente para ocultar deuda y colocar a familiares y amigos sin control ni fiscalización alguna. En conjunto, unos 120.000 millones, equivalentes al 11,4% del PIB, se despilfarran anualmente en un sistema de nepotismo, corrupción y falta de transparencia.
Y con esto se tiene que acabar, entre otras cosas, porque ya no hay dinero. Los últimos datos de las cuentas públicas conocidos la pasada semana son escalofriantes. El déficit del Estado a julio ascendió al 4,62% del PIB, frente a un déficit del 3,5% comprometido con la UE para todo el año (del 6,3% incluyendo regiones y ayuntamientos). Pero lo realmente inaudito es que España está gastando el doble de lo que ingresa. 101.000 millones de gasto a julio frente a 52.000 millones de ingresos, y precisamente para poder financiar el despilfarro de regiones y ayuntamientos, que no están en absoluto comprometidos con la consolidación fiscal.
El tema del déficit público es algo que roza la ciencia ficción, y que ilustra perfectamente la credibilidad de los dos últimos gobiernos de España. En noviembre de 2011, el Gobierno dijo que el déficit público era del 6% del PIB; a finales de diciembre, el nuevo Gobierno dijo que le habían engañado y que el déficit era superior al 8%, y que se tomaba tres meses para calcularlo con toda precisión. A finales de marzo, se dijo que definitivamente era del 8,5%, y ésta fue la cifra que se envió a Bruselas. Dos semanas después, la Comunidad de Madrid dijo que sus cifras eran erróneas y el Ayuntamiento de la capital igual… el déficit era ya del 8,7%.
Sin embargo, la semana pasada el INE dijo que el PIB de 2011 estaba sobrevalorado y, con la nueva cifra, el déficit era del 9,1%; dos días después, Valencia dijo que su déficit era de 3.000 millones más; o sea, que estamos en el 9,4% y las otras 15 CCAA y 8.120 ayuntamientos aún no han corregido sus cifras de 2011. Lo único que sabemos es que están todas infravaloradas. El déficit real de 2011 puede estar por encima del 11%, y en 2012 se esta gastando el doble de lo que se ingresa. Como dice el Gobierno de Rajoy, “estamos en la senda de convergencia”. Y es verdad… de convergencia hacia Grecia.
Claramente, la joven democracia española tiene todavía muchos déficits de representatividad y de democracia que deberían interesar a la canciller Merkel y también a Europa, si queremos evitar una Grecia multiplicada por cinco y salvar el euro. Esto es lo que ha hecho posible el despilfarro masivo de las ayudas europeas, con una asignación disparatada de las mismas, a pesar de que estas ayudas han supuesto una cifra mayor que la del Plan Marshall para toda Europa.
Es frustrante que a causa de este sistema oligárquico nepotista y corrupto se destroce talento y creatividad y que ahora muchos jóvenes se vean forzados a trabajar fuera, muchos en Alemania. Esa situación nos ha llevado a una distribución de riqueza que es de las más injustas de la OECD. La antaño fuerte clase media española está siendo literalmente aniquilada.
Resumiendo: no es una falta de voluntad de trabajo, como se piensa tal vez en algunos países del norte de Europa, lo que hace que España sufra la peor crisis económica de su Historia. Es un sistema corrupto e ineficiente. La crítica del Gobierno alemán y sus condiciones para un rescate de España se deberían concentrar en la solución de esos problemas. En caso contrario, solo conseguirán que una casta política incompetente y corrupta arruine a la nación para varias generaciones.
*Stefanie Claudia Müller es corresponsal alemana en Madrid y economista.
I don’t have time to translate it to English so I have quickly run it through Google translate:
Today, September 6, Madrid are in the governments of Germany and Spain, accompanied by a group of businessmen, and where you discuss the conditions for granting more financial aid to Spain or its banking system. On both sides has increased tone in recent months and it is with great anticipation that Spain now expects the decision will take the German Constitutional Court, it is crucial that, the 12th, on the compliance or non-rescue European and obligations for the Germans.
In Germany growing criticism against the alleged “party mentality” of the Spanish, in Spain’s media are increasingly negative with the supposed hardness of Chancellor Merkel. We think the situation is much more complex than presented both governments and most of the media. Spain is not Greece, but Spain can be a chronic patient if Germany, along with Europe, does not contribute to solving their real problems.
Spain should not get more money without thoroughly change the political and economic system, now in the hands of a political oligarchy allied with the economic and financial oligarchy, and without increasing the actual citizen participation in political decisions. To avoid perpetuating the crisis and the Spanish indebted for generations, the Spanish government must thoroughly reform the administration of the autonomous regions and municipalities, mostly bankrupt and completely out of control, subjecting the model state referendum.
This is the key issue of the future of Spain, because the regions, municipalities and county councils are responsible for two-thirds of public expenditure 118 000 234 000 million from the state in 2011 – excluding Social Security-23 000 million, and this expenditure is made under conditions of lawlessness, corruption waste and totally unacceptable. The real reasons for the crisis in the country, in line with what has been said, have nothing to do with wages too high-about 60% of the working population earns less than 1,000 euros/mes-, pensions too high, the average pension is 785 euros, 63% of the average EU-15, or a few hours, as sometimes transmitted from Germany. In Spain also lacks talent or creativity or entrepreneurship. Has great thinkers, creatives, engineers, doctors and managers excellent class.
The reason for Spain’s disease is an unviable state model, all source of all corruption and nepotism, oligarchy imposed by a party in collusion with the financial and economic oligarchies, and the judiciary and enforcement agencies to their Service. In Spain there is no separation of powers, and judicial independence, and the deputies representing citizens, only parties that put them in a list. This also leads to an underground economy that reaches 20% of GDP and that stifles competition, efficiency and development of the country. Also detracts resources that could be funded education and health.Aid for Spain, as for other possible candidates for bailouts, banks should not go nearly bankrupt and heavily politicized. In the CAM, the Government has committed 16,000 million of public money instead of closing, in Bankia, 23,000, and just give the Executive urgently 5,000 million to cover losses rather than close it, and also so strangely aroused all kinds of suspicion. Why the money was used by the Spanish (FROB) instead of waiting for EU funds? It is fair to assume that the reason is this: the banks do not want the EU to investigate their accounts.
Strict control and harsh conditions. Since the case of Greece has shown that European aid must be linked to strict and harsh conditions. These conditions can not only represent brutal social cuts or tax increases, as does the Government now Mariano Rajoy on the grounds of Europe. You have to change more in Spain to cut social spending, that’s still much lower than in Germany, and there are infinitely more relevant expenses that can be eliminated. In addition, cases of corruption are so outrageous, even within the government, one can only come to one conclusion: the money of Europe can not be handled by persons so incredibly venal.
Last week the Minister of Industry also accused Soria-planning corruption in Canary-accused Finance Minister in the Cabinet of blatantly favoring the leading renewable Abengoa, which had been an advisor in the new regulation of these energies, which are more than 7,000 million euros in subsidies annually. And Rajoy, who delivered a letter probation, or said and did absolutely nothing.
No longer can afford this level of corruption, let alone running 17 regions as independent states, with all organisms multiplied by 17, from 17 to 17 meteorological services ombudsmen, with 200 embassies, 50 regional TV channels loss, 30,000 official cars or 4,000 public companies employing 520,000 people, created specifically to hide debt and put family and friends without any control or oversight. Altogether, about 120,000 million, equivalent to 11.4% of GDP, are wasted annually in a system of nepotism, corruption and lack of transparency.
And this has to end, among other things, because there is no money. The latest data from known public accounts last week are chilling. The government deficit to July amounted to 4.62% of GDP, compared to a deficit of 3.5% committed to the EU for the year (6.3% including regions and municipalities). But what is really outrageous is that Spain is spending twice what you input. 101,000 million spending July compared to 52,000 million in revenue, and specifically to finance the waste of regions and municipalities, which are in no way committed to fiscal consolidation.
The deficit issue is something that borders on science fiction, and it illustrates perfectly the credibility of the last two governments of Spain. In November 2011, the government said the public deficit was 6% of GDP by the end of December, the new government said it had been deceived and that the deficit was more than 8%, and it took three months to calculate with precision. In late March, said he definitely was 8.5%, and this was the number that was sent to Brussels. Two weeks later, the Madrid said his figures were wrong and the city of the same capital … and the deficit was 8.7%.
However, last week the INE said GDP in 2011 was overrated and, with the new figure, the deficit was 9.1%, two days later, Valencia said its deficit was more than 3,000 million, that is, we are at 9.4% and the other 15 municipalities CCAA and 8120 have not yet corrected its figures for 2011. All we know is that they are all undervalued. The actual deficit for 2011 may be above 11%, and in 2012 they are spending twice what is entered. As the Government of Rajoy, “we are on the path of convergence.” And it’s true … convergence towards Greece.
Clearly, the young Spanish democracy still has many gaps and representative democracy that should interest Chancellor Merkel and also to Europe, if we want to avoid a fivefold Greece and save the euro. This is what has allowed massive waste of European aid, with a crazy assignment thereof, even though the aid has been a figure greater than the Marshall Plan for Europe.
It’s frustrating because this nepotistic and corrupt oligarchic system shatter talent and creativity and now many young people are forced to work outside, many in Germany. This situation has led to a distribution of wealth that is the most unfair of the OECD. The once strong middle class is being literally wiped Spanish.
In short, not a lack of willingness to work, as it is thought perhaps some northern European countries, making Spain suffers the worst economic crisis in its history. It is a corrupt and inefficient. The criticism of the German government and its conditions for a bailout of Spain should focus on solving these problems. Otherwise, just get an incompetent and corrupt political caste ruin the nation for several generations.
* Stefanie Claudia Müller’s German correspondent in Madrid and economist.
Personally I think this sums up everything nicely. Sorry it’s so long but I think it is worth reading.
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Agree with every thing. If the forum users collate all that has been posted about Spain. We would have come to a similar concluion minus the number of 000,000,000.
I had made, many post stressing that Rajoy has a once in life time opprtunity to pull Spain out of its mire and politically blame EU for it. The coming generations will thank him for it.
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I’m not as close to the day to day reality as many of you, never having been resident in Spain. But, from what I have read since I started my research regarding my fathers property, the article above seems to pin most of the troubles to corruption and maybe mis-management (too much power in the regional governments).
What I wonder is, how far does the corruption go, I have read many times about the favours/blind eyes turned to the mayors brother, friend, son in law etc.
The reason I raise this, is that despite the populus wanting the problem sorted out, how many of the masses are involved or benefit from the corruption, even to a smaller or lower level? I do wonder if, when people realise that an anti corruption drive/purge takes place, they might themselves lose some form of income or have to pay taxes/fees that they manage to avoid at the moment. Would this portion of people represent a major part of the population or is it still a relative minority?
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The corruption at what ever level is so deeply imbeded that most normal people have lost the sense/difference of doing the things in a normal manner or a corrupt manner.
Pete, the corruption may be carried out by a few at what ever level. The trickle down affect is felt right accross in financial terms & in terms of attitude as to how to carry ones life on a day to day basis.
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I guess what Spain needs is for someone, ie: Rajoy, to say ‘ok, i’m the boss and this is what we are all going to do’. He’ll be called a ‘francista’ by many and much worse but I can’t see any other options. Spain needs to be controlled via Madrid. Andalucia, Castilla, Catalunya etc. needs to be controlled by a central Government not by so many different Presidents and their cronies.
What Spain really needs is a near Dictator to take charge and tell them all what they are going to do. Fingers out of the pie everyone…..
Will it happen? Isn’t the only other option to separate all the different parts of Spain and be controlled by Europe? ie: Spain as a whole country ceases to function?
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The figure has been announced – going to be €59.3bn (about £47 billion)
The seven banks that are fine and don’t need additional capital are BBVA, Santander, Sabadell, , Caixabank, Unicaja, Kutxabank and Bankinter
Popula necesitaria 2.000 millones, Bankia 24.700, Catalunya Caixa 10.800, Novagalicia 7.200, B.de Valencia 3.500 y Nostrum Capital 2.200
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Gaaah what you guys are missing is that this is only money to cover the immediate “shortage” of capital in these banks becuase of earlier losses. This however does not include any coverage for future losses that the banks are hiding in their books, losses that they even now know that they have but ain’t officially a loss.
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