Hello,
I think you will enjoy this article, the original is in Spanish, I have translate it to English ( I tried my best). Is write by Mr Roberto Centeno , Professor of Economics of UPM University, Spain.
14 of December 2009
What's happening in Spain?
What happens in Spain? Was the question posed a few days ago by a primarily responsible for a large multinational with interests in Spain. In a country with a decent government, central bank and a decent statistical system would be a rhetorical question. In the Spain of Zapatero, with a insolvent government that lies massively, a central bank who lies and a statistical system who lies also, the question is most relevant. And the answer is: They do not know. "Zapatero has lost credibility," said The Economist a couple of weeks ago. And as they do not know it, they stop investing, that simple. The foreign investments have collapsed a 90% in the first semester.
Zapatero said on Thursday in the presentation of the Economic Report that "recovery is imminent", that is, has ordered the political commissar of the National Sadistic Institution (INE) and the governor of the Bank of Spain that the fourth-quarter growth must be positive "as is " Never mind that the main indicators of output and demand say otherwise, it does not exceed the five million unemployed, no matter who is taking Spain to the ruins, they are lying without limit and make it back to their boss to start the EU Presidency with a vibrating "We have also come out of the crisis!", A must since its objective is "to make Europe stronger economically." Finally we are the laughingstock of Occident.
What we know
And yet, nothing is further from the truth. In the final of this year 2009, the economy not only keeps falling, it falling faster. But above all, the increasing restriction of credit to households and businesses, reducing the incentives for third party, the rise in interest rates and the upcoming brutal tax increases, fees and prices for all services, will further reduce investment and private consumption, 87% of the GDP in 2010 and successive years
We see the last independent indicators of production and demand.
Consumption of electricity: -3,6% in November against -1,3% in October corrected of temperature and calendar.
Fuel consumption: -4,6% in November of 2009 versus. equal month of 2008, and also worse than in October, -2,8% versus October 2008. But in addition the gasolines collapse a -7,6%, which the past gives to an idea of the landslide of the private consumption month.
Gas consumption: -19% in November versus. equal month previous year; much worse than third trimester - 12% with respect to equal period of the previous year.
Sales of the great supermarkets: -5% with respect to November of 2008 and clearly worse than in October, and we are speaking here of products of first necessity.
Sales of electric home appliances: they have fallen, according to ANEL, a 16.06% in November, against an accumulated fall of the 15,68% in the first eleven months.
In summary, a serious worsening of the economic situation in November. Considering the GDP of October and November, through consumption of diesel automovile, a variable strongly correlated, this a 4% have fallen, and in 2010 with less rent available, less more expensive credit and, the situation only can get worse. And this can not be change by the lies to it of the central Bank of Spain(BdE) or the National Statistic Institution (INE). The last one: the National statistic Institution (INE) has corrected the expenditure by family in 2008:-4,2% in real terms, fall far beyond the published one
And now regarding the government accounts, the Achilles heel of our economy. The Net borrowing-emissions minus depreciation-, amounted to 24 November at 110.492 million euros, and since December, I repeat, is the worst month deficit effect,it will close the year around the 130,000 million Euros, which will elevate the debt of the State to 47.5% of the GDP. But the national debt more things are many: the alive debt of the CCAA, 81,981 million in the second trimester of 2009, with a year-end estimate of the order of 100,000 million and the outstanding debt of municipalities and County Councils, 32,000 million at end 2008, with an estimate of around 45,000 million at end 2009.
But even this is all, is the back door to hide the debt, the state public enterprises, regional and local authorities, which have grown exponentially: there are almost 4,000 companies to day of today, whose alive debt to February 2009 ascended to 44,598 million Euros, and one 55,000 estimation of in order year. In summary, total national debt in order 2009, 67.5% of the GDP. And the worse thing is not the absolute number, that already is brutal, but its dizzying growth rate and that almost all of this increase is current expenditure, ie structural.
What we do not know but we can estimate:
Real unemployment and rate of increase. Neither the EPA (active population survey) and even less in unemployment, show the reality of unemployment, but can be estimated by adding the excluded groups to the lies of Zapatero. The EPA(active population survey) ruled last 550,000 people, mostly educated young people because "not actively seeking" work are "discouraged", and classified as inactive. Additionally, the 2005 methodological change as workers to part-timers to 600,000 unemployed. Therefore, real unemployment in the third quarter: 5.2 million. Registered unemployment excludes the “DENOS”(Unoccupied Job Seekers [1]) that the INE( National statistic Institution) considered unemployed and not included as unemployed jobseekers excludes by Minister Caldera, self employers ( they have no compensation when they loss the job), the unemployed perceiving the 420 euros and discouraged that no longer re-enroll every month. Total 5.4 million through November, where he also has devised a new lies from Zapatero: 140,000 unemployed received the 420 eur help were excluded from unemployment[2], ie the official unemployment in November rose to 200,600, a figure that compares with 175,000 in November 2008, ie, the rate of increase grows not decreasing.
Deficit and public debt by 2010. According to PGE (General state finances) 2010, gross financing requirements would amount to 212,000 state million and a net 76,177. PGE in 2009, the gross were 104,500 million and net 28,500.Ex-minister Solbes was a phenomenon! And now is the same and the same reasons, mostly understated expenses and overstated revenue. The best estimate of the needs of the state debt amounted to 200.000 million net today.
To this one adds to predicted indebtedness 2010 for CCAA and Local Beings, 60,000 million; debt overcome and not paid with independent SMEs and, 30,000 million; debt of public companies, 15,000, a total debt of 98% of the GIP, the temporary margin has disappeared. I cannot understand from where it has removed S&P the number of 67% in 2.010, an analysis frivolity, because here “beans are counted”. As it indicated to Friday Marc Vidal here, “the debt only has a foreseeable way: its collapse”.
And what happens in the financial system? I merely summarize. BDE, rather than undertake sector restructuring as it was obliged, closing the unviable and capitalizing on the viable, dedicated their time and efforts to hide the truth by every means at their disposal.
CCM intervention has been an unmitigated disaster, and theft from taxpayers, the politicization of rural banks has led to the unprecedented, and worst, there has been some deleveraging, institutions are refinancing a huge debt to guarantee the state without any analysis of who can and who can not repay, which ultimately became a historical dispossession, because now they are not themselves but we, the people responsible for their return. The ending, will bankrupt half of the sector as the cost of their rescue is out of the country's chances.
As it affirms Credit Suisse, we are worse than Greece, because our deficit is structural due to a model of nonviable State, 18% in 2009 versus 12% Greece; because the debt grows the triple that the rest; by the unstoppable deterioration of the real economy and by the inevitable collapse of the financial system.
What really happens? We are at the cliff edge. At the Abyss.
Roberto Centeno
Professor of Economics of UPM University
1.- Unoccupied Job Seekers: Applicants will be known as pre-employment services and will help the regions, for example, which governs the PSOE, be drawn from lists of registered unemployed to those who feel they need to complete a training course for employment in another sector.
2.- They are considered like persons in formation.
Spanish version here : http://www.cotizalia.com/dispa…ppens-spain-20091214.html
Pd: first post here , sorry I only speak Spanish, English or French . (google bablefish for German).
