As our readers should know, we have been overly bearish with regards to the Spanish Economy. The main problem, still not covered by any economic researcher, is the great Spanish denial. With politicians, policy makers, business managers etc denying the state of the economy, the problem Spain faces will ultimately be much bigger than if you would deal with the problem. Valencia “came clear” on Friday, and expect more regions to follow. Murcia’s president is putting the whole problem rather clearly. From El Mundo.
“Let no one think they’re going to give away money” , said Valcárcel, who has predicted that “it would ask for between 200 and 300 million” but specified that is not yet fixed the exact amount requested to fund the Murcia region created by the Government to help the regions.
Murcia President said that “in practice”, all regions are taken over, as he explained, the State “forced” to make decisions that will not normally be taken.
“All regions can be tapped, because if you do not meet the deficit, the state forces you to take action and that is the intervention,” he said.
“There will come a few gentlemen dressed in black with a briefcase, wearing sunglasses, to get us out of the offices to clean slap” incident Murcia President, who asked whether he would resign if there is intervention, considers that Zapatero and then Rajoy “should have resigned several times.”
In this sense, states that as a community “belong to a state that requires you to take action and as a country, belong to a union of states that also forces you to apply for the general good.”
Guest post by Azizonomics.
Something very interesting is happening.
There’s been so much corruption on Wall Street in recent years, and the federal government has appeared to be so deeply complicit in many of the problems, that many people have experienced something very like despair over the question of what to do about it all.
But there’s something brewing that looks like it might be a blueprint to effectively take on the financial services industry: a plan to allow local governments to take on the problem of neighborhoods blighted by toxic home loans and foreclosures through the use of eminent domain. I can’t speak for how well the program will work, but it’s certaily been effective in scaring the hell out of Wall Street.
Under the proposal, towns would essentially be seizing and condemning the man-made mess resulting from the housing bubble.
With Spain having experienced a “mini” Black Friday two days ago, although people still believe this is a local problem, here we present you out favourite documentary of the “real crash”.
With Valencia insolvent, make sure to watch the other problematic regions of Spain namely; the Islands, Castilla la Mancha, Andalucia and Catalonia, as the crisis goes into phase two. Remember, just like the Asian crisis in the late 90′s, it all started as a local problem, and then became a global problem.
Guest post by Doug Short.
The past week was shaping up to be one of the strongest performances of the year for our eight featured world markets. But then Friday happened. Seven of the eight closed the week with a selloff following renewed anxiety over the eurozone debt crisis. Only the Hang Seng continued its rally, finishing the week as the top performer with a 2.87% gain. The DAXK came in a distant second, up 1.11%, but at Thursday’s close it was up 3.07%. The Shanghai Composite was the week’s worst performer. In fact, on Monday it hit a new interim low, 38.12% off its 2009 high.
The table inset in the chart below shows that four of the eight markets, the Asia-Pacific contingent, are in bear territory — the traditional designation for a 20% decline from an interim high, unchanged from last week. In our gang of eight, the S&P 500 remains the closest to an interim new high, down 3.97% from its April 2nd peak. At the other end, the Shanghai Composite is a stunning 37.53% off its interim high of August 2009.