- This topic has 23 replies, 10 voices, and was last updated 11 years, 8 months ago by
.
-
Posts
-
-
Many brits have bought a property in Spain believing that they were owning a bit of paradise in the sun but it is turning out to be a coffin in the sun as many brits are saddled with properties they cannot sell even at a massive discount compared to their mortgage and are facing a future where the spanish economy is getting worse by the day with increasing civil unrest, rising unemployment, a collapsing economy, rising cost of living, particularly utility bills like gas, electricity and water bills.
The Spanish Government has a huge deficit and is desperate for money and it will inevitably raise the annual property taxes on properties owned by residents and non-residents alike. The Government has introduced stiff penalties for anybody not declaring their foreign bank accounts to the revenue and are threatening to reintroduce the annual wealth tax that was abolished a few years ago. The Government is coming after anybody who owns a business or a home in Spain. The expat community in Spain are a particularly tempting target for the Spanish Government to come after by raising the annual property taxes and forcing the disclosure of financial information from people with the view to extorting as much money from people as possible because of the dire state of the public finances.
The main advantage of moving to Spain was the low cost of living compared to living in Britain but nowadays Spain is no longer a cheap country to live in especially as the house price boom made buying a property in Spain very expensive and the general cost of living and annual property taxes have risen to such an extent that it makes living in Britain better and cheaper than living in Spain.
Many British expats are realising to their cost that they are sitting on properties that they cannot sell even at half the price that they bought them for and are living in a country that is falling apart around their ears. Little wonder that many British expats are desperate to leave Spain and return to the UK.
-
if they were that desperate they would just lock up and leave come back to the uk get their council house and sign on the dole what could the spanish government or banks actually do take 50p a week out of their money.The reason most left was the social decay in the uk that is still here to come back to only the reality of it is if they do come back they will be right in the middle of it.
Its true that since spain has joined the euro the cost of living has risen and with tax rises it will continue to do so,they only want to come back as there is no work to pay for them to stay and live that dream.Most would rather stay and be poor in spain than come back and be poor in the uk.
But with no work in spain they can’t stay and be poor and thats the only reason they want to return -
Very true dartboy.
A very sad situ. The opinions in the UK of those who went to Spain isn’t great either. Just the other day they made a few snarly comments on the Channel 5 ‘The Wright Stuff’ programme about those enjoying their lives in the sun shouldn’t receive the winter fuel allowance. ha ha, have they tried living in Spain during January, brrrrrr!!!!!! I’m 35 so I don’t get the benefit of the winter fuel allowance but I think that those who paid into the UK system all their lives should be allowed to claim it.
Too many are stuck between a rock and a hard place. The lifestyle they sold up to move to Spain isn’t what they can now go back to. They’ll stay in Spain because the drink is cheaper there and they can bury their heads in the sand easier ?
-
-
@peterhun wrote:
@dartboy wrote:
if they were that desperate they would just lock up and leave come back to the uk get their council house
Where would these council houses come from?
same place they come from for all the other europeans landing on our shores for a free life or a corrupt one fiddling all they can get whilst working for cash.I know alot of them now go into privately owned rented properties and not actual council houses but its all paid for by as tax payers so amounts to the same thing in the end
-
-
Cheap to cheep….. people who paid 300,000 euros who now have their place up for 199,000 euros means that it’s very cheap to them, and they are going to make a big loss. It’s not cheap to those who want to pay ‘cheap’ and therefore see 90,000 euros as ‘cheap’.
Cheap to me are the flats in my block where we could buy 4 flats for the same cost of our mortgage…..
There are those who cannot sell for cheap because they have a mortgage which isn’t cheap, ie: our situ.
Others can’t sell for that cheap because they need to make enough on top of maybe paying off a small mortgage to buy something other than a shoebox in the UK.
The banks might sell for cheap because they’ll close their eyes and just want to get shot of something, otherwise they will try to sell a mortgage to cover the repo mortgage and therefore that won’t be cheap.
Cheap things are out there but it depends on the situation behind the sale. That is probably why the whole Spanish market is shot to bits… too many properties, no buyers at the prices advertised and those who can’t sell at the price they need to get.
Is it a waiting game? Do we suffer for another 5 years to maybe sell for the mortgage amount then? If only we had a cristal ball!
-
Exactly -my opinion is that properties under 50,000 are in the lower end. With sterling up these are very saleable . If you are not in a hurry to exit Euro or can re invest the Euro somewhere safer with a yield and not convert to sterling now. The more expensive properties have higher leverage more often with borrowing so of course they are marked down more -it always happens in a bear market. But at some point these properties will all find a point where they are bought by somebody -question is when. At under 50000 after all a property has a use unless you have something round the back of Torrevieja San Luis not very nice-but as long as neighbours not intolerable its better than an English winter if you have a pension you can survive on.
-
2024 is when the UK market will recover
http://www.cityam.com/latest-news/house-prices-remain-below-peak-until-2024
So plan for that.
At under 50000 after all a property has a use
I doubt many people have access to that sort of money. No credit, it would most people a decade of saving for a ‘cheap’ property.
-
The biggest problem is that banks gets treated to well. Goverments around the world hand them money with the idea that it will trickle down to their consumers but the banks make more money on just keeping it and try to offload their own portfolios at high prices instead of handing the credits out to buyers that wants to buy any property. This is because of a oligopoly in the banking world. Under true market conditions other banks would pop out and hand out these loans. The way this is being done is to make it so complex to start a bank that basicly no one except the banks themselves can do it. Imagine how easy it would be to start a new bank at the moment with none of the baggage but since it’s not possible this won’t happen. The new banks would not have to include all the bad loans into their books.
An easy solution under this system.
1. Let the bad banks go bankrupt by not giving out easy credits. People somehow believe this would hurt the normal person in the street but it would not. “excluding stockholders and people invested in this ofcourse”
2. Let their holdings be sold of to the highest bidders and this would also include consumers. Let the buyers get the same conditions as the banks and let banking be open to anyone.
3. Prices will fall and the new buyers will get a better start. Eventually things will become better.
4. It must become as easy for people to get out of bad deals and go banrupt as companies.
As I have said numerous times before the core problem is that governments hand the banks the power of attorney to create money out of thin air which always will result in the same thing eventually. Since no one is interested in hearing of that I will just stick with this for the time being.
-
@Ardun wrote:
As I have said numerous times before the core problem is that governments hand the banks the power of attorney to create money out of thin air which always will result in the same thing eventually. Since no one is interested in hearing of that I will just stick with this for the time being.
I agree with most of your posts Ardun but I have to confess I have never really understood this one. 😕
The banks are under the control of the particular countries central bank which is given the mandate to supervise them. In some countries its independent of government, UK for example.
The only central bank in the Eurozone that can create money ‘out of thin air’ is the ECB which has sovereign independence from Brussels and the member states. That created money is usually used to buy national debt on the secondary bond market.
Banks of course borrow on the international markets but that is not created money it belongs to someone usually private institutions.Perhaps you could explain your point further.
-
@logan wrote:
@Ardun wrote:
As I have said numerous times before the core problem is that governments hand the banks the power of attorney to create money out of thin air which always will result in the same thing eventually. Since no one is interested in hearing of that I will just stick with this for the time being.
I agree with most of your posts Ardun but I have to confess I have never really understood this one. 😕
The banks are under the control of the particular countries central bank which is given the mandate to supervise them. In some countries its independent of government, UK for example.
The only central bank in the Eurozone that can create money ‘out of thin air’ is the ECB which has sovereign independence from Brussels and the member states. That created money is usually used to buy national debt on the secondary bond market.
Banks of course borrow on the international markets but that is not created money it belongs to someone usually private institutions.Perhaps you could explain your point further.
Yes I’m interested too. I assumed Ardun was saying that banks can collectively increase the supply of broad money through fractional reserve banking, and since it now appears that the broad money will ultimately end up being converted to narrow money via QE, then it is as if the banks are able to create money out of thin air. That’s to say, money created in the form of temporary loans either gets rolled over or sold to the central bank in return for cash, so it ends up being a permanent addition to the money supply. I may have got this wrong, but it is my interpretation.
-
Thanks Chopera that explains it. There was a thread some time back about fractional reserve banking.
Wiki explains it well which reads like a massive officially sectioned Ponzi scheme :Fractional-reserve banking is a form of banking where banks maintain reserves (of cash and coin or deposits at the central bank) that are equalt to only a fraction of the amounts of customers’ deposits. Funds deposited at a bank are mostly lent out; the bank keeps only a fraction (called the reserve ratio) of those funds as assets or “reserves”. Some of the funds lent out are subsequently deposited with another bank, increasing the fund assets and deposit liabilities at that second bank, and allowing further lending. As most bank deposits are treated as money in their own right, fractional reserve banking increases the money supply, and banks are said to create money. Due to the prevalence of fractional reserve banking, the broad money supply of most countries is a multiple larger than the amount of base money created by the country’s central bank. That multiple (called the money multiplier) is determined by the reserve requirement or other financial ratio requirements imposed by financial regulators, by the excess reserves kept by commercial banks, and by the publicly held currency not deposited in banks.
-
For anyone else that might be interested, the following description of fractional reserve banking helped my understanding a lot:
Imagine that Person A has a €100 note and places it in the Bank A. Then Bank A keeps a €10 reserve and lends €90 to Bank B.
How much money is now in circulation?
Person A thinks he has got €100 deposited with Bank A, and Bank A thinks it has got €100 on its books (the €10 reserve and the €90 deposited with Bank B) and Bank B thinks it has the €90 deposited by Bank A on its books. So collectively there is now €290 in circulation. €190 of broad money has been created from €100 of narrow money (cash)
Of course all this will unwind if Person A decides to withdraw his €100 from bank A, but in practice that money will end up back in the banking system soon enough (Person A might spend the €100 at Tescos and Tescos will then deposit the money in their account instead, and the process will repeat itself again)
My understanding is that a Ponzi scheme is where a fund manager uses people’s deposits to pay excessive interest on initial withdrawals in the hope that the faked success of the fund will keep encouraging new deposits. Those who get out in time do well (e.g. the fund manager), those who don’t lose everything. I’m not sure whether the banking system counts as being a Ponzi scheme, but it certainly is a confidence trick. But then again isn’t money itself a confidence trick? (the words credit and debit themselves stem from belief and doubt)
-
-
@logan wrote:
@Ardun wrote:
As I have said numerous times before the core problem is that governments hand the banks the power of attorney to create money out of thin air which always will result in the same thing eventually. Since no one is interested in hearing of that I will just stick with this for the time being.
I agree with most of your posts Ardun but I have to confess I have never really understood this one. 😕
The banks are under the control of the particular countries central bank which is given the mandate to supervise them. In some countries its independent of government, UK for example.
The only central bank in the Eurozone that can create money ‘out of thin air’ is the ECB which has sovereign independence from Brussels and the member states. That created money is usually used to buy national debt on the secondary bond market.
Banks of course borrow on the international markets but that is not created money it belongs to someone usually private institutions.Perhaps you could explain your point further.
Not sure where to start. But I’ll try and then we will see what I miss.
Central banks are thought by most to be sovereign entities that operates in it’s own nations interest. In some cases they are not even owned by the state like the FED in the US. In Sweden we have a central bank that is owned by the state. In the case of the EMU they have replaced their own nations central banks with one for the whole eurozone. Without a central bank the confidence in the currency would literally be zero. It would be like me starting my own currency just by using my xerox machine and call it Arduneuro.
Who would use such a currency when there is nothing guaranteeing that it actually holds a value? Bartering as you know means that if you want a certain product and something to trade you will have to trade with someone that has what you want and they also want your product. This is very inneficient as you may imagine on a larger scale and especially for a consumer. You could travel for days to a market and find out that no one wanted your wool right then if that was what you had. Result is that you starve to death.
Earlier in history when people started using “money” instead of bartering the money in itself was made out of precious materials which gave it a certain inherent value except the value that was stamped on the coin. Don’t confuse this with that it has to have a common practical value but it’s ofcourse good if the material also has a practical value. The material in itself is not really that important because people will choose this by themselves by their own free will. Gold was often used but also other materials. Through history people have liked to use currencies that have real values backing them up because it’s practical. Imagine if you lived in a country that was invaded by another country and your side lost… if you still had your gold you still held “power” or “true value”. Their are certain chareceristics for what is prerequisites for what people have enjoyed in their currency and one is that it’s easy to transport “small and easy to hide” and there are other but that I’ll leave that for now.
Kings that ruled most nations back then clearly understood that controlling “money” would in reality be to hold the ultimate power and control it’s population. The kings themselves was almost always backed by other people and especially a bunch of clerics. In the beginning they basically “stole” from other people by wars but wars was also very costly in popularity and they risked being overthrown but it was sort of good to get rid of useless peasants and other poor people so they could take their land when they died in wars and then they also could get their hands on their and their enemies fortunes “precious metals, land, food and other materials”. Kings really never lived long without the backing of religious clerics of different sorts to make people behave because a kings whip can only get people to do stuff when directly controlled. The nations traded with other nations and would only accept good “money” otherwise you wouldn’t get your steal, gund powder etc. Wars also costs true money which meant that most rulers made sure that it was only allowed to create money if the king had approved of it. Either he owned this industry outright or he taxed these approved creators of money. When the rulers owned this creation facilities themselves they started to dilute the amount of precious materials in these coins and used these left overs to trade with other nations… the nations own people where not stupid and therefor inflation was created by people demanding more coins for the same things “pigs, wheat etc”. As you see inflation was invented by these power fraudsters a long time ago and they did it by violence, religious deities or threats. Now you may ask but what does this has to do with anything?
When normal people got more knowledgeable and kings etc started to dissapear because they got overthrown/killed and people got less mindfucked by religion the people in power needed new ways to control the “peasants”. They couldn’t really control the people directly anymore because they wouldn’t stand it. The same sort of people that backed the kings back in the days understood that they couldn’t hold back the wheels of development but adjusted their strategy to give people the idea that they in reality controlled their own destiny “democracy” but at the same time make sure they handed over their wealth to them. At certain periods in time they didn’t even hide this fact as can be seen by a quote from one of the creators of fractional reserve banking system and central banks.
“Give me control over a nations currency, and I care not who makes its laws” – Baron M.A. Rothschild
http://en.wikipedia.org/wiki/Bank_for_International_Settlements “Has anyone of you even heard about this entity before?”
http://www.bis.org/central_bank_hub_overview.htm?l=2
You have to understand that the real owners behind these central banks is who controls a few mega banks which controls the FED and now later the euro and the IMF. Since the dollar and the euro are the premier reserve currency.
The idea was to give politicians the obvious power when chosen but in reality controlling them to do what they want. That is why it was so important for them to make sure that central banks sort seem to be in control of the people when it’s not. All central banks but a few has for quite a long time belonged to the same international central banking system which basicly controlls which countries starve and who succeeds by cutting off the supply of credits. There was a few totally independent central banks but a few years ago but they are almost all gone now “Iraq, Sudan, Afghanistan, Libya” the only ones remaining that I can think of right now is Iran, Cuba and North Korea. Why do you think the first thing that happens in these conflicts is that the rebels starts a new central banks… even before the battles have ended. By law it’s illegal in most countries to start competitive currencies and you will in some cases be punished harder than commiting murder.
Now you may ask why is it so important? It’s because if this system is removed they loose control of politicians who are voted in by the people.
It’s because that politicians are just gambling bricks and they know that these politicans must behave like they want otherwise they will cut of the flow of credits. These mega banksters don’t care if it’s a democrat or a republican that is voted into office because their policies all stem from the fact that they promise their voters stuff otherwise they won’t win an election and these things are financed through the central banking system which I have allready explained all belong to a world wide net of central banks controlled by these mega banksters. It’s quite obvious when you see that these financial institutions send huge amounts of money to both Obama and Romney to hedge their bets. To them it simple doesn’t matter if one guy wants to spend it on health care and the other on wars and other things because the money stems from the same place. This is also why it’s so important to make sure the “free world” dollar and now later the euro will remain as the favourite reserve currencies around the world and they do this by diplomatic preassure, wars and propaganda.
Some countries that have tried to price oil “very important resource” in gold have imidiately been cut of from this system and put under sanctions if they didn’t cave into this preassure. Aren’t they free to choose not to accept dollar or euro?
Fractional reserve banking is basicly in the end what makes these mega banksters transfer wealth from the gullible masses in a way that is so complex that most don’t even have the knowlege about how it works. They not only get to make money on the interest on all the free money they hand out but they get to choose when to creaty havoc in the financial systems and can then after extreme financial turmoil buy real assets for peanuts with their useless currencies. To show you one example of how it works here in Sweden is that when the government and local governments wants to loan money there are no reserve ratios even the only thing holding them back is that they don’t want inflation to become to obvious to the people so they will become to fuzzed about it. Who will work and pay taxes to a obviously corrupt system? Another advantage is that these financial institutions also gets to act before inflation has occured because they are the first people that gets their hand on this new money and can use it before prices has gone up. To me it’s fraud and if you tried to do this yourself you would be put in jail immidiately.
What is needed is a fair, transparent honest financial system and it’s not possible when every goverment in the world “almost” are controlled by these entities. Sound money is what’s needed.
Chopera explained in a simple way just exactly how fractional reserve banking works in simple transaction terms and I hope I somehow tingled your interest in the ramifications of it being used. Please try and poke holes in my reasoning and I’ll expand on my reasoning. =)
-
Lovely simplified post Chopera. 🙂
The fraud element in Ponzi schemes is conning the investor their money is invested in safe assets when in fact it’s being used to pay other investors. With fractional reserve banking the government will always repay the depositor if the bank fails and are in fact the lender of last resort and there in lies the difference.
A Ponzi scheme can continue forever in theory. The trouble comes when the depositors ask for their money back in large numbers and cannot be repaid. There is no lender of last resort the depositors lose and the operators go to jail. In the US usually for life since there it’s considered the most heinous crime you can commit.
-
-
-
Ardun I have waded through your post on this subject and although interesting I was not taught anything knew. I wrote a thesis in my youth on the development of capitalism and the market economy and still have it buried in a drawer somewhere.
My feeling are and always have been that capitalism is a lousy, imperfect system as Churchill wrote “The inherent vice of capitalism is the unequal sharing of blessings; the inherent virtue of socialism is the equal sharing of miseries.”
The truth is we all have to serve somebody. That’s how human development has got us this far in a very short time from emerging out of the jungle, swinging in the trees to fractional reserve banking.
Human development I have absolutely no doubt will eventually discover a better way, unless we destroy our civilisations first.
So the rich control us all, no surprise there. How else can it work? Revolution of the proletariat? Tried that and failed. You just just swap one set of gangsters with another. At least bankers are relatively benign creatures. 🙂
I think money is relatively sound as long as it’s backed by stable governments. Gold is better for safety but lackluster in performance. Property is a good hedge because if all else fails you can live in it. Fine wine you can enjoy and drink, art you can appreciate and improve your day.
Once in a while you will stumble upon the truth but most of us manage to pick ourselves up and hurry along as if nothing had happened.
-
Someone who sells up in UK fed up with the weather could afford to buy in Spain. Particularly if they have a pension . It all depends upon lifestyle how little you need to live on – if you are used to paying council tax and TV licence in UK you will save money. If you don’t drive like walking and live somewhere near shops and facilities maybe have a bit of growing space . If you live near a beach fill up with sea water to flush your toilet and save the water bill -I do and its good exercise.If you have a rod there are fish in the sea too.
-
-
I am 8 kilometres from a beach Katy and I often walk to it !The sun gives more energy! Part of the way off the main road I strip off my shirt in the sun in the middle of winter and need electricity to heat only a bit in evenings Jan’Feb sometimes. This will be changed to a gas heater when I can get one without the bottle directly behind. Not so easy to find one where you have a flu through the wall as in UK. Hopefully gas prices will remain relatively cheaper than electricity-and don’t forget Iberdrolas tariff con discriminacion -cheap rate midnight to midday 11 euros to change tarrif as you need different meter but no change in the potencia charge. I have intellectual interests and in UK -I live as economically as I can though without skimping on fresh food as I always have -but no time for the booze and barbecue Brit style
-
@logan wrote:
In theory yes Peter. I note the Icelandic Prime Minister found himself in court recently.
Yes, a social call to his family and friends, the judge and jury. In Iceland laws exist on paper and can be use, ignored or retrospectively re-written as needed.
-
- The forum ‘Spanish Real Estate Chatter’ is closed to new topics and replies.
