Tuesday, January 20, 2009

Some months ago Scotland’s First Minister made exactly the same boast as the Spanish President, viz. that his country’s banks were “among the most stable financial institutions in the world.” Well, at least events haven’t overtaken both of these assertions and President Zapatero still has the right to repeat the claim. Though this might amount to another of his favoured hostages to fortune as we await the 2008 results of Spanish banks that some say are being delayed because they aren’t what they were cracked up to be. Even so, I doubt that events will have overtaken words in the Spanish case quite so spectacularly as they did in the Caledonian case. There goes Scottish independence in 2010. Not that it had much chance anyway.

I’m confused as to how the French government can be offering subsidies to the country’s car makers, provided they keep jobs in France. Perhaps the EU has relaxed its laws on this. Or maybe France is once again leading the way in disregarding basic EU principles that have suddenly become incompatible with her self-interest. Or maybe I was just plain wrong to think state handouts were now forbidden as being prejudicial to fair competition.

Near term, it looks as if the UK might lack the cash to make any hand-outs, even if there were industries left to get them and even if the government wanted to legally or illegally help these. The head of a think tank called Work Foundation has suggested Britain is on the verge of bankruptcy and close to needing a loan from the IMF. Meanwhile, it seems to be the consensus that the 37 billion pounds recently given to British banks succeeded in stopping the complete collapse of the banking system but failed to solve the credit crisis. So another humungous sum is apparently required. OK, but this still leaves the question – If cash isn’t flowing around the financial corpus [corpse?], where is the 37 billion that was doled out a few weeks ago? Sitting in the vaults? Being paid out in bonuses? It would be nice to know. Especially if you're a British taxpayer. And the unwitting owner of shares in several of said banks.

As for Spain, click here if you want a balanced local view on how things are going here. The author endorses my comment of yesterday that the government appears to be quite clueless. Perhaps the cabinet sat down a few months ago and said “Well, we successfully lied our way through the general election last March, so why don’t we try the same thing ahead of the Basque and Galician general elections this coming March. Or let’s just whistle.” Sadly, though, events such as the S&P downgrading of Spain’s credit rating means that masterly inactivity is not really a viable option now. Especially as the natives are showing signs of getting increasingly restless. And that was before the EU announced that the government’s latest economic forecasts were so much wet paper!

Here in Galicia, yesterday’s papers had what I guess we could call the Monday Litany. 21 years old. BMW. 140 horsepower. Curve. Reasons unknown. Excessive speed. No seat belts. Another six young people dead. Obviously, the most depressing day of the year was harder to take for some than for others.

Talking of driving, I’m encouraged to see it’s not only in my barrio that this sort of thing takes place.

I thought I'd leave you with a smile . . .

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