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If memory serves this bank was formed by the government in 2010 by the amalgamtion of around 7 local banking institutions who were all in trouble. So as for the current situation, why am I not surprised?? But for the proper answer, Mary will post it very soon I am sure. Looking forward to it in fact!!!
 

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"Macro Economics" isn't that something to do with Camoron's "Big Society" and how if they keep screwing the poor, they won't have a shilling to put in the slot to keep the electric meter going and won't be able to see the news on TV nor be able to afford to buy a newspaper which might tell them how the government is protecting the rich and preventing them suffering hardship at the expense of the OAPs?
 

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As thrax says why would you be surprised that the amalgamation of seven banks with undeclared loses equals one large bank with undeclared loses?

The difference of course is that in Spain you can get away with it. Take the over valuation of Facebook in the US. It is immediately investigated. Legal action is persued by individuals. The players involved will have to explain and could face huge penalties. And it's not yet clear that any law breaking occured.

In the case of Bankia "nada" :rolleyes:

And does anyone believe 19.8 billion is enough? Only two months ago 4.5 billion was enough. Less than two years ago zero Euros was enough. Someone posted the other day that property prices might drop another 35%. That's speculation of course but is not impossible. If it happens how much more would bankia need? This injection of cash will cost every breathing soul in Spain more than 500 Euros. And that is for only the fourth biggest bank in Spain :cool:
 

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Discussion Starter · #7 ·
I refer to my original posting. This morning it has been announced by the ECB that Spain cannot borrow by issuing bonds to underwrite Bankia's debt. My question therefor still stands.
I see that the Governor of the Bank of Spain has resigned over this and many other failings in the past, good riddance to him Useless lump :clap2:
 

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Seriously, though, I have said already that the chief villain is the economic model adopted by most western states.
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has been steered into something its founders never intended it to be. The Single European Act was a marketeer's charter.
I'm glad to see my defence of Zapatero vindicated:


The EC Evidently, this crisis has nothing to do with the recklessness of Spain's government.

Instead, it was other people in Spain who behaved recklessly


People who borrowed beyond their means and unions who pushed for wage increases without a concomitant commitment to productivity must take their share of the blame.

There was nothing Zapatero could do under the terms of the SEA to stem the flow of cheap mainly German credit.

But are the Spanish people as a whole to blame? Of course not. Some are, some aren't. But there is no way to separate the 'innocent' from the 'guilty' so all must suffer.

As in Greece. As in the UK. I who have never had any debt have seen my income cut by a third, as have many others here. Apart from fume and curse, what can I do about it? Nada.

I've had plenty of time since I took to my bed last Saturday to read and contemplate. Outcomes I had ruled out as 'never going to happen' become more likely day by day. I adjust my views to the facts on the ground....incidentally I've just discovered it was Keynes and not Mark Twain who said 'When the facts change I change my mind. What do you do?'

Thirty or so years ago my reply would have contained words such as 'capitalists,' 'exploitation', 'the working class' etc. etc. but history and I have outgrown that. I foresee a number of scenarios, all involving chaos and misery. Greece is bust and must surely exit the euro ...hopefully in an orderly way.
Maybe the euro itself will fall, something I scoffed at a year ago.

I only hope that sensible people all over Europe will reflect upon the experience of the last thirty years and decisively reject in future any economic policy, no matter what glittery things it promises, that doesn't take as its first premise the principle that the market must be society's servant, not its master.

But I don't hold out much hope, tbh.
 

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Seriously, though, I have said already that the chief villain is the economic model adopted by most western states.
.
has been steered into something its founders never intended it to be. The Single European Act was a marketeer's charter.
I'm glad to see my defence of Zapatero vindicated:


The EC Evidently, this crisis has nothing to do with the recklessness of Spain's government.

Instead, it was other people in Spain who behaved recklessly


People who borrowed beyond their means and unions who pushed for wage increases without a concomitant commitment to productivity must take their share of the blame.

There was nothing Zapatero could do under the terms of the SEA to stem the flow of cheap mainly German credit.

But are the Spanish people as a whole to blame? Of course not. Some are, some aren't. But there is no way to separate the 'innocent' from the 'guilty' so all must suffer.

As in Greece. As in the UK. I who have never had any debt have seen my income cut by a third, as have many others here. Apart from fume and curse, what can I do about it? Nada.

I've had plenty of time since I took to my bed last Saturday to read and contemplate. Outcomes I had ruled out as 'never going to happen' become more likely day by day. I adjust my views to the facts on the ground....incidentally I've just discovered it was Keynes and not Mark Twain who said 'When the facts change I change my mind. What do you do?'

Thirty or so years ago my reply would have contained words such as 'capitalists,' 'exploitation', 'the working class' etc. etc. but history and I have outgrown that. I foresee a number of scenarios, all involving chaos and misery. Greece is bust and must surely exit the euro ...hopefully in an orderly way.
Maybe the euro itself will fall, something I scoffed at a year ago.

I only hope that sensible people all over Europe will reflect upon the experience of the last thirty years and decisively reject in future any economic policy, no matter what glittery things it promises, that doesn't take as its first premise the principle that the market must be society's servant, not its master.

But I don't hold out much hope, tbh.
Well said mrypg9
That link to the Beeb Solwriter put up also has a very good story headed "Europe’s Economic Suicide" from the New York Times. http://www.nytimes.com/2012/04/16/opinion/krugman-europes-economic-suicide.html?_r=1

Sorry to throw in a movie analogy, but with all this gloom and doom in the eurozone it feels like a financial version of "The Day After tomorrow"!

When will the euro(rats) finally wake up and realise they’re following the wrong path and convincing as many of us as they possibly can to follow them out into the approaching deadly storm!
 

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This makes interesting reading...from Open Europe Forum - sorry, don't know how to do links....





Beyond the troubled banking sector, there is another potential problem on the Spanish horizon that could be instrumental in how the euro crisis develops: the central government’s relationship with the 17 Spanish regions, and particularly its ability to keep public spending at the regional level under control.

The 1978 post-Franco constitution designed Spain as a highly decentralised state. Regional statutes are treated as an integral part of Spanish law, and the regions legislate over a wide range of policy areas, from local infrastructure projects to culture and healthcare. As a result, they currently handle over 50 per cent of Spain’s total public spending.

Earlier this year, the new centre-right government, led by Mariano Rajoy, was quick to blame the regions for Spain’s failure to meet EU-mandated deficit targets. He had a point, but, ironically, some of the spendthrift regions – like Comunidad de Madrid and Comunidad Valenciana – have been led by the Prime Minister’s own party, Partido Popular, for years. More worryingly, earlier this month, excessive spending in these regions again forced Rajoy to revise upwards the country’s deficit.

This shows just how difficult it will be for Madrid to control the regions, and therefore Spain’s public spending. Spanish regions have committed to a total of over €18bn (£13.6bn) of savings by the end of 2012 – almost half of Spain’s planned deficit reduction for this year. Given their past record, the regions are unlikely to deliver, meaning that the central government would have to pick up the slack. This would put further strains on Spain’s public finances, which will need much of the ammunition at their disposal to deal with potential future bank bail-outs.

What can Rajoy do? The Spanish parliament has recently passed new legislation giving the government the power to take over the accounts of regions that look set to miss their deficit targets, and the tiny principality of Asturias may become the guinea pig for the new system. But will regions such as Catalonia or the Basque Country – which take their regional identity and independence extremely seriously – accept Madrid coming anywhere near their partial budget autonomy? It looks doubtful. The Basque Country is going to take the government to the Constitutional Court over planned cuts to health and education, while the Catalan governor, Artur Mas, has threatened to break his regional alliance with Partido Popular, unless Catalonia is granted greater tax autonomy.

Spain could be heading for a major political showdown. In theory, Rajoy’s Partido Popular holds a sufficient majority to push through legislation without the support of regional parties. This is precisely what happened with this year’s budget, when the Prime Minister’s party rejected all of the over 3,000 amendments tabled by the opposition. However, the price of consistently taking such an inflexible stance may well be greater discontent in Barcelona and Bilbao.

In general, the feeling is that Rajoy may already have reached the political limit of how much he can encroach on regional autonomy, and any further steps in this direction would require important changes to the Spanish constitution – for which there would be very little support.

So what is the significance of all of this for the future of the Eurozone? First, those that put their hope in the Spanish government being able to deliver far-reaching deficit cuts, via equally far-reaching savings in the regions, are likely to be disappointed. Spain is not going to become France – a highly centralised country where the national capital rules supreme over public spending. Spanish regions will remain a liability, and pushing them too far may trigger a huge political backlash, which would hardly benefit the Eurozone either.

But second, there’s a bigger lesson. If Spain faces difficulties in achieving more fiscal centralisation in its own country, due to political constraints, how much more difficult will it be for the single currency to achieve similar centralisation at the level of all 17 Eurozone members – considering its own number of different parliamentary and economic models, government structures, and cultural preferences? Just a thought.
 

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This makes interesting reading...from Open Europe Forum - sorry, don't know how to do links....

Earlier this year, the new centre-right government, led by Mariano Rajoy, was quick to blame the regions for Spain’s failure to meet EU-mandated deficit targets. He had a point, but, ironically, some of the spendthrift regions – like Comunidad de Madrid and Comunidad Valenciana – have been led by the Prime Minister’s own party, Partido Popular, for years. More worryingly, earlier this month, excessive spending in these regions again forced Rajoy to revise upwards the country’s deficit.

This shows just how difficult it will be for Madrid to control the regions, and therefore Spain’s public spending. Spanish regions have committed to a total of over €18bn (£13.6bn) of savings by the end of 2012 – almost half of Spain’s planned deficit reduction for this year.


What can Rajoy do? The Spanish parliament has recently passed new legislation giving the government the power to take over the accounts of regions that look set to miss their deficit targets, and the tiny principality of Asturias may become the guinea pig for the new system. But will regions such as Catalonia or the Basque Country – which take their regional identity and independence extremely seriously – accept Madrid coming anywhere near their partial budget autonomy? It looks doubtful. The Basque Country is going to take the government to the Constitutional Court over planned cuts to health and education, while the Catalan governor, Artur Mas, has threatened to break his regional alliance with Partido Popular, unless Catalonia is granted greater tax autonomy.
I have edited out a large chunk. If you want the full ish - read Mary's post.

"He had a point, but, ironically, some of the spendthrift regions – like Comunidad de Madrid and Comunidad Valenciana – have been led by the Prime Minister’s own party, Partido Popular, for years."

Does this surprise you, it doesn't me. Isn't this the same as in the UK but on a different scale - the rich get a tax cut not that they pay much anyway and the ones who are penalised are the poorer (inc. OAPs)

Whatever Rajoy tries to do, his own little PP satellites (see above) will do as they please as will the Basques and Catalans, leaving the poorer communities, e.g. Andalucia, et al to pick up the tab.
 

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We tried Makro economics once but found their prices not much better than Tesburys, Asdorrisons and the rest and what with having to drive a 24mile round trip to get to Makro, it just wasn't worth it.
 

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This makes interesting reading...from Open Europe Forum - sorry, don't know how to do links....
Just copy and paste the link into your post using the insert link icon (5 from the right in the second row down from the top) - the forum software does the rest.
I say this because I would like to have a look at that forum myself, but googling doesn't bring up the required results. :)
 

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Well said mrypg9
That link to the Beeb Solwriter put up also has a very good story headed "Europe’s Economic Suicide" from the New York Times. http://www.nytimes.com/2012/04/16/opinion/krugman-europes-economic-suicide.html?_r=1

Sorry to throw in a movie analogy, but with all this gloom and doom in the eurozone it feels like a financial version of "The Day After tomorrow"!

When will the euro(rats) finally wake up and realise they’re following the wrong path and convincing as many of us as they possibly can to follow them out into the approaching deadly storm!
Interesting reading.
I'm someone who cannot resist reading comments on an article and sadly (and as usual...) most of the commenters were stuck in their own little "bubble" of "lets blame the socialists" and failed to address the wider scope of what is happening.

However, I found one interesting suggestion...
Spain truly is unique because it was not spendthrift like Greece, had real-estate-political corruption like in Ireland, a history of debt like Italy, or a competitiveness issue like Portugal. It's private sector, with the help of German banks, made mistakes - the public sector should not fix the folly of the private sector...if Germany truly believes in markets, then let the private sector pay for the mess instead of passing it onto the public sector to clean up the mess through austerity.
I would not agree with all of this (particularly regarding real estate), and how on earth Spain could move forward economically at this time by penalising the private sector is another issue.
But interesting nevertheless.
 
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