Tuesday, October 01, 2019

Thoughts from Pontevedra, Galicia, Spain: 1.10.19

Spanish life is not always likeable but it is compellingly loveable.   
                  Christopher Howse: A Pilgrim in Spain

NOTE: As usual, the free wifi on this boat is weak and unreliable - which Brittany Ferries freely admit in the leaflet they hand out. So, I'm going to try to knock out a short post before the hordes arrive from their cabins and reduce the early morning capacity even further.

Spanish politics
  • The 'far left' Podemos split, with one of the founders forming something called Mas País/Mais País, I think. One Spanish commentator has suggested the proves the validity of the old adage that folk of the Left are only really together when they're in the same prison. Or something like that. 
The Spanish Economy
  • Thomas Cook bad news - Hundreds of Spanish hotels will be forced to close and thousands of people laid off.
  • Thomas Cook good news: It might mean the end of binge drinking holidays in Magaluf.
Spanish Life  
  • Turning off the A8 yesterday afternoon, I came across one of those bar toilets severely lacking in many of the 15 things I've said go to make up a perfect facility. Most annoyingly, soap and any sort of towel on which to dry your hands. I wonder if that pilgrim I met a while ago in Pontevedra ever did complete her survey of toilets around Spain. I didn't get the impression it was going to be a paen of praise.
  • Over the years, I've said that things happen here in a way they wouldn't elsewhere. I thought of this today when driving to Santander. I normally take the AP9 to the airport and then cut across country on the N634 to the A6 and then the A8 - up to and along the magnificent Asturian/Cantabrian coast. But I'd read that the A54 motorway(autovía) from the airport to Lugo had finally been extended beyond said airport. And, sure enough, there were signs on it giving the distances to both Lugo and, to my surprise, Oviedo. Going fast to the latter city would cut out the need to drive north and then along the coast, so - while wondering if this really was wise - I decided to stay on the A54 to Lugo and Oviedo. Only to find that, first, all mentions of Oviedo soon dried up and, then, the A54 petered out near Arzúa. Keeping this as brief as I can, I ended up on the N634 I normally take from the airport. And might have saved about 5 minutes in the process. My question is - Why indicate that the autovia goes to Lugo and Oviedo when it bloodywell doesn't?
Pontevedra Life
  • The remodelling of O Burgo bridge is late; The AVE from Madrid to Galicia is late; the reformed city leisure centre is late. There are delays in every country, of course, but I do wonder whether anyone in Spain ever expects anything to be completed on time.
The UK/The EU/Brexit
  • A writer on the Daily Telegraph thinks it's about to blow up - again. See the article below.
  • I'm convinced - by one clue or another - that many folk on this boat to and from Plymouth aren't paying the king's ransom I am to take my car to the UK. As before, I'm pretty sure they're day-trippers who just spend 2-3 hours in the supermarkets and bars of the Santander seafront.

As so often down the centuries, Europe is blowing itself up again: Jeremy Warner

Last week I wrote about political uncertainty as the new normal for the economy and financial markets. It seems that there is a growing body of opinion at the Bank of England that agrees.

In a speech, Michael Saunders, an external member of the Bank’s Monetary Policy Committee, said that UK interest rates may need to fall further regardless of what happens over Brexit, such is the likely seemingly never-ending uncertainty created by its political fallout.

This runs contrary to the official line, which is that even in the event of a no deal Brexit, interest rates may have to rise to deal with the inflationary consequences of any shock to output capacity.

Very few people believe this is actually what would happen in practice, and now along comes Mr Saunders to say, indeed; the economy is already slowing precipitously, so we may need to cut whatever happens over Brexit.

I’ve given up trying to figure out where we’ll end up on this journey. Almost any prediction is rendered redundant within a few hours by the unfathomable politics of the UK’s predicament.

Last week’s Supreme Court judgement seems to make the chances of a deal, already quite slim, vanishingly improbable.

But even if there is one, it’s not going to end the uncertainty, or the now dangerously destructive effect of Brexit on business investment. For any deal will cover only the transition. There would then follow talks on the future relationship, setting the country up for a series of cliff edges.

The same goes for a no deal Brexit, which might be thought the final closure but in truth would offer no clarity at all. The UK’s future trade relationship with the EU would remain deeply uncertain.

“Persistent rolling uncertainty is likely to be especially damaging”, says Saunders. “Firms keep expecting Brexit related uncertainties to be resolved fairly soon – hence providing a temptation to defer major spending until the situation is clearer – only to find that the situation is just as uncertain a few months later, so they defer spending again and again”.

With interest rates already so low, further cuts will do very little to counter these negatives. More effective would be fiscal stimulus, but judging by the Office for Budget Responsibility’s latest analysis, there is virtually no room left for this within the current fiscal mandate. A stagnant economy is already reversing recent improvements in the public finances.

The situation scarcely looks any better across the Channel, where the present standoff with Britain is threatening to plunge the entire Continent into recession. Wherever the blame lies, Europe is once again blowing itself up, as on so many occasions down the centuries.

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