Articles by Miguel Navascués

About the Author

Miguel Navascués
Miguel Navascués has worked as an economist at the Bank of Spain for 30 years, and focuses on international and monetary economics. He blogs in Spanish at: http://
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How To Bring Spain’s Economy Out Of Its Coma

Miguel Navascués | To build a public housing stock to house those who are now forbidden to be evicted? Or to undertake a plan such as the one proposed by the chief economist of Arcano, supported at the time by the president of Santander? The traction effect of the construction sector is proven, and is indisputable. However, according to Julián Núñez, president of the construction employers’ association, SEOPAN, the data and forecasts are not encouraging.

European fiscal stimuli

Spain Expects To Mobilize €500 Bn In Investment With European Funds

Miguel Navascués | In a paper entitled Recent Developments in the Spanish Economy, Policy & Funding, the Spanish government explains how the  €140 Bn from the European Recovery Fund will be allocated to obtain the best result: a solid rebound of the economy with permanent fundamentals. According to the government, it is expected these €140 Bn to have a multiplier effect of about €500 Bn, i.e. a not inconsiderable multiplier of 3.6 euros for each spent. Is it reasonable to expect such an amount?

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The Blunder Of Negative Interest Rates

Miguel Navascués | The depression and the drop in inflation -or even deflation- have led the central banks to try a disastrous experiment: negative interest rates. Even Christine Lagarde speaks of putting the reference interest rate at -2%. This has been a mistake for several reasons. It discourages the holding of liquid deposits (which logically yield zero or negative), but it does not make people anticipate consumption, if prices stagnate or fall.

spain no confidence

With The Lack Of Confidence in Spain, The Crisis Is Prolonged

Miguel Navacués | In the 2’Q20 Spaniard’s savings rate on disposable income reached a record high of 31.1%. Investment depends on companies’ expectations, sales and profitability, which increase their value. And it in turn depends on the effective demand, which determines the volume of sales. If there is no sales volume in sight, there is no demand and GDP shrinks. Demand in Spain -except from abroad- is still digesting the collapse due to the pandemic, and the resurgence in cases, amid a climate of permanent mistrust which is prolonging the crisis.

Leverage loans. The next trigger?

Inflation Is Impossible: The Speed Of Money Circulation Is At An All-Time Low

Miguel Navascués | The Fed is continuing to buy assets and issue money to chosen subjects (for the first time not just the banks). The purchases made so far are more than double those made in 2008. However, the speed of money circulation (i.e., GDP/M2), shows a decline to levels never seen before: each unit of money in circulation moves just $1.4 of GDP. Or, in other words, more and more money is needed to move the same amount of GDP.

spanish households

Long read: Expectations behind the negative yield curves

Miguel Navascués | The slope of the interest rate curve has become negative in several countries, among them the most important. As we know, whenever this happens there is a high probability that it is anticipating a recession, in this case global. Some countries will come out of this better than others, but the recession is highly likely.

New regulation on anticrisis buffers.

Has the crisis really ended?

Miguel Navascués | There are many signs that the public think the crisis is over. One is the bankruptcy of Podemos, but there are many more. But has it ended? I doubt it.


Action against climate change: too many ambiguities

Miguel Navascués | Everyone talks ever more passionately demanding that climate change be slowed by changing from energy based on oil and gas to one that does not produce CO2. But no-one explains if technological change will really allow this to happen in time.


Spain has highest proportion of contracts of 6 months or less

Inequality is not Spain’s problem. Unemployment is

Miguel Navascués | The winner of the recent elections, Pedro Sánchez, defined his objective in the previous debates with great precision: to end the increasing inequality in Spain. But inequality is not the main problem in Spain, it does not even have the nature of a problem. To begin, it is not increasing.

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The negative yield curve and its consequences

Miguel Navascués | Recently, in the US, long term interest rates have fallen below short term rates. This has a more concrete significance: the economy is getting weaker and could enter recession. Something unusual has happened which we must explain.