jojojojojojojojojojojojo

Spain??? Oh, I thought Spain wasnt having to borrow? I thought it was using its reserves???

Jo xxx

cricketman

I've just been searching for some government and consumer debt data, but the sources tend to be a little contridictory...

re, Spain, they are screwed for a couple of reasons at the moment:
1. I read in El Pais that the goverment gets 50% of its income from property sales taxes. Sales are incredibly low at the moment so government gets a lot less money
2. Unemployment is at 17% or so, so income from taxes is low and benefit payments are high (yes some people do get benefits!)

I've spoken to some Spanish people who lost there jobs and have started to retrain in the public sector as they said these are the safest jobs. As I had had a few drinks I pointed out that the government will have to make cuts as their budget has been slashed. I felt cruel afterwards and wished I hadnt said it

One has to have hope afterall...

jojojojojojojojojojojojo

I know Spain is screwed, I just thought, unlike the UK, it was using reserves it had accrued from all the EU subsidies, internal wealth etc. Also they havent had any banks ripping the country off!!? I havent done any serious investigating tho.

Jo xxx

Jo xxx

bigglesworth

The level of debt is the main burden on the UK economy. The reasons we are backing away from the highs and testing new lows can be found in several recent events.
A - tax receipts are very sharply down (both income and VAT). Therefore Godon and the Morons latest prediction for the deficit (I cannot remember wheteher it was 150 billion or 160 billion or whatever other number they picked out of a hat) is, as predicted, well sbhort and as more knowledgeable people estimated likely to exceed 200 billion this year.The markets have wind of this, and are anticipating. As is the Bank of England which by some happy coincidence has just decided to increase Quantitative Easing ( or printing money in layman'slanguage) by a further 50 billion, after indicating to the markets they would stop at 125. Not surprisingly, the markets smell a rat.... and a big one! Because the only buyer of UK debt has been .......
The Bank of England! i.e our grandchildren!
So 1q.20 has moved further into the distance. I still think it will come, and posibly 1.30, but we will have to wait until the end of the year. The Bank simply cannot keep printing money, and will have to find some other way of financing the deficit. And the market is very plain that it is not going to lend t this dshambles of a Government (Not that Dave and Boy George seem to have much in the way of a plan).
So I am personally convinced interest rates will rise before the end of the year, and faster and further in the UK than elsewhere.

As for Spain- well unfortunately Spain is a member of the Euro, so the Spanish economy will continue to choke on German needs. And the ECB seems remarkably sanguine about the very realpain it is inflicting on Spain Portugal Greece Ireland, Italy etc etc.

As for Spanish banks - we will only know the true position when they have to VALUE their loans. Which most havent and wont until they default, and is why they are playing Pass the Parcel. Spain may have been saved from some of the excesses of the property bubble, but as most loans were underpinned by asset valuation, housing is only the visible part of the iceberg that leapt out of the water and ripped into the banking sector. To their complete astonishment . How could they ever have guessed?

jdr

Our local council has just been given 4,6 million €`s by the gov to pay of some of its creditors.

greghal

The key issue is thta spain doesnt realy metter for the Euro, ats all about france and Germany

bigglesworth

I completely agree

jojojojojojojojojojojojo

http://www.eyeonspain.com/spain-maga...nks-crack.aspx
?????


Jo xxx

jdr

He`s Martina Cole in disguise and trying some new stories to flog the new book. lol

jojojojojojojojojojojojo

Maybe, I'm no great lover of the media and its hidden agendas, but there must be a bit of truth in it maybe???

Jo xxx

cricketman

There is a little bit of truth of it, but the author has blown it out of all proportion.

Not one major Spanish bank is in trouble, just the odd local Caja is in trouble. Mainly because they are small and so some were badly exposed to toxic mortgages.

The government has recently set up a fund to help rescue any Caja's in trouble. So far none of the money has been used.

The Spanish bank system is in a much stronger position than in the UK or US, that is for sure

bigglesworth

Unfortunately, I dont think you can put too much faith in anything the bankers say. Certainly Spanish banks were restricted in how much they could lend on property assets. But they were not restricted in what they could lend to businesses with property assets, nor in loans to the developing world and Eastern Europe.

They are undoubtedly (we all hope) in a stronger position than some of the UK and US banks, although that is not saying much. But until the loans come up for renewal or borrowers default, no one can really tell. After all there is a boom going on in the UK at the moment, fow who would not feel flush with loans of hundreds of billions to spend. So much like the UK government, the test will come when the money has to be repaid.

So we had better all just keep our fingers crossed. After all, with the Spanish economy contracting as fast as it is, it is hard to believe that there is not more pain to come for the bankers.

cricketman

Where on earth did you get that idea?

I guess you must be referring to the house prince index increasing slightly. I believe they call that a dead cat bounce. And the volume of sales is still low anyway. Give it 3-6 months and house prices will be on the slide again. To (mis)use a politician's phrase "The fundamentals are solidly...flawed!!"

All other data shows the UK is in recession

steviedeluxe

Hold onto your seats. We're going to see some volatlity, especially as uncertainty increases the closer we get to an election.

greghal

Mervyn king again causing sterling to tumble