Spain – The Next Domino Is Getting Ready To Tumble
Posted 17 March 2012 - 04:12 PM
It is well known that Spain's economy is in a depression, and we do not use this term lightly. With the official unemployment rate at about 23% and youth unemployment close to 50% it is not an exaggeration to speak of a depression. The probability of social upheaval erupting with greater frequency is extremely high. We already noted that the general strike recently called for by Spain's unions is only the fifth since the end of the Franco regime in 1975. It is a rare event in Spain and underscores the decline in the social mood and the growing desperation. Those who still have work want to protect their privileges and use the unemployed as their political weapon.
Meanwhile, Spain's banks are quietly sinking beneath the waves. They are the quintessential zombies, especially the insolvent cajas, which are drowning in real estate related assets that see the value of their collateral inexorably spiraling down the drain (as an aside here: the Fed's recent 'stress test' of US banks possibly has not taken sufficient account of this 'moving target problem'; as we have seen mentioned elsewhere, it also failed to consider the remote possibility that treasury bonds may decline more than it currently widely expected).
But let's return to Spain. The WSJ reports on the latest house price data, and keep in mind here that these are the 'official' and hence doctored in every imaginable way, data. The plunge in house prices is in fact accelerating.
Peter David Schiff --- http://www.europac.net/
Gerald Celente --- http://www.geraldcelente.com/
Jim Rogers --- http://www.jimrogers.com/
Bob Chapman --- http://www.theintern...om/Bob_Chapman/
Investors should abide by money management principals & never risk more than they can afford to lose.
There are No guarantees when investing in the Stock Market or Precious Metals. You might lose all your money and cry.
Posted 17 March 2012 - 04:53 PM
Or they may be looked on as a special case and not have to stick to the new fiscal rules
Here's the head of the eurogroup and PM of Luxembourg Jean-Claude Juncker with Spain's economy minister Luis de Guindos
The more houses cost, the more hours you have to work to buy one. The more hours you work, the more taxes you have to pay the Governbankment. The more debt you take on, the more interest you have to pay bankers, so the more hours you work for them.
If it is asserted that civilization is a real advance in the condition of man -- and I think that it is, though only the wise improve their advantages -- it must be shown that it has produced better dwellings without making them more costly; and the cost of a thing is the amount of what I will call life which is required to be exchanged for it, immediately or in the long run.
A "Governbankment" is a Government that has no line between itself and banks. It diverts public money (our taxes) to private companies (banks). George Osborne's Help to
Buy Bail Banks, will see our taxes go to bankers to cover their losses on mortgages that default.
If you say "Democorruptcy" quickly, it sounds a bit like "Democracy". In a "Democracy" people vote for politicians who represent their interests. In the UK's "Democorruptcy" people can only vote for expense fiddling thieving MPs who are in the hip pocket of big business and the finance sector.
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