Sunday, February 07, 2010

Economic woes in Europe and Spain: Galicia's savings banks; and John Terry

Well, the EU sovereign credit/debt crisis is edging towards its end-game but the jury is still out on the way in which Greece (and possibly other Club Med members) will be prevented from bringing the EMU edifice crashing down. Our friend Ambrose surveys the scene here and, taking into account that “Both the City {of London] and Brussels seem certain that Europe will conjure a rescue – possibly a 'Eurobond'" – he concludes that this is likely. However, he hedges his bets because no one really knows which way the EU’s great paymaster will jump. “Germany” he stresses “has not endorsed any such rescue.”. On the basis of this, he counsels caution about betting on Germany paying to save the EMU. As he says, signing off – “Berlin hawks might prefer to lance the Club Med boil sooner rather than later.” I guess we’ll know soon enough.

Meanwhile, here is Spain the domestic economy continues to dominate the news. El País tells us today that President Zapollyanna is finally effecting a drastic turn in his policy, in order to meet the global lack of confidence in the Spanish economy. And also to save his own hide, I guess. All sorts of statements are being made about pensions, labour contracts, cuts in government spending, reduction of public debt, etc. but the most worrying thing seems to be that, as someone has observed, you’d be hard pushed to see evidence of measures designed to address Spain’s greatest problem – its lack of international competitiveness and the challenge faced in restoring something like decent growth in the absence of a domestic driver such as the (vanished) construction sector. As El País put it today – “The financial markets always look to the future and this is where Spain is failing.” Rather worrying really. Though rather more so for those dependent on employment prospects than for me. Even taking into account the devaluation of my pension.

More locally, Madrid has finally endorsed expectations it would reject as unconstitutional the Xunta’s law permitting (compelling?) the fusion of Galicia’s two caixas (savings banks). Effectively, they’ve said that competency lies with the (fusion-averse) Bank of Spain and not with the regional government. What the state and BoE wants, of course, is trans-regional mergers – or even the disappearance of a few caixas – but commercio-political self-interest and Spain’s infamous ‘localism’ are significant barriers to these. So this show could run and run. And remain the sort of massive distraction localism engenders.

Well, almost 50% of Brits surveyed felt that John Terry should not have been sacked from his position as captain of the England football team just because he's a serial adulterer. This compares with 100% of the twelve Spanish men I dined with on Friday night. Personally, the most interesting comment on this nonsense I’ve read is how ironic it is that an Italian is sacking an Englishman for his extra-marital sexual activities. Not that he was, of course. He was fired because he got caught and because he crapped on his own doorstep, losing the confidence of his fellow team players in the process. Nothing to do with morality. Except that of low-brained, high-salaried footballers.

Finally . . . I see we have not one but two phantom zebra crossings near my house. And that, in the 1.1km between my house and the bottom of the hill, there's a total lof 42 shiny new signs. Four of which, of course, flank said crossings. Nice business for someone.

Galician Rural retreat for rent:

OK, I may not be able to sell my house but I can still rent it out. Anyone wanting details of a rural place very convenient for Pontevedra and the coast should click here.


sp said...

I do believe that you've forgotten to put the price of an early July rental on the page for Los Robles. People need to know.

Anonymous said...

Surely New World Order/Bilderberg Group conspiracy theorists would argue that Germany, although appearing reluctant, would welcome the opportunity to meddle in/control the economies of Greece, Spain, Portugal, etc. - finally achieving its ambitions that failed by other means

moscow said...


I will continue to asiduously read your blog. Perhaps, in due time I will understand your humour.
Not that that should be easy for us dumb foreigners. Anyway, I realise I have a steep learning curve ahead of me.

Now, what exactly were you lying about last time? The fact that you have a pension denominated in Pounds? Or that your concerns about the EU are unrelated to the effect the "high" Euro is having on your present (and future) stream of income?

Colin said...


That the devaluation of my pension is my biggest concern.

My biggest concern is living long enough to enjoy it. And seeing my daughters happily married and giving me grandchildren, etc. etc.

As I've said, I'm in the entertainment business (who on earth would read my Thoughts otherwise?) so I often exaggerate (and obfuscate) for effect. Anyone primarily interested in Spanish politics and her economy would surely go somewhere else.

But I'm delighted that, notwithstanding this, you remain a reader.

I must be doing something right.

Must have a beer one day. Though not in Moscow, I fear.


Colin said...


Many thanks. I will rectify this today. Meanwhile, there's always this place to consult . . .

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