MADRID | By Fernando G. Urbaneja | Spanish households and businesses were the most indebted at the beginning of the crisis (80% of the total), but now their debt is getting smaller in a systematic and decided way. The same cannot be said of the State, which keeps increasing its public debt with equal zeal (or even more) and has gone from less than 20% at the beginning of the crisis to 36% this week (and still growing).
OP-ED By Julia Pastor | The decapitation of Spain’s three main newspapers – El País, El Mundo and La Vanguardia –in last three months is a symbol of the country’s weak democracy. This is, however, the tip of the iceberg. Spanish freedom of expression’s faults touch not only big and well-known media groups, but also modest-sized blogs such as Nada es gratis (No Free Lunch in English) in which Spanish economists try to explain to the citizens what is happening in the national economy and suggest possible solutions. Three of that platform’s founders and editors recently left their posts after disagreements with the managing team and the government.
ATHENS | Yanis Varoufakis via TrumanFactor | Why an independent Scotland should get out of sterling, but Greece should not volunteer to exit the Eurozone? Scotland should state its intention to decouple from sterling, once independent, rather than petitioning for a continuation of its subservient role in an asymmetrical sterling union. But if this is good advice for Scotland, why am I arguing that Greece should not sever its links with the even more odious monetary union known as the Eurozone? Unless the two cases differ, my argument lacks consistency. But they do differ. Fundamentally too.
BRUSSELS | By Jacobo de Regoyos | Both financial analysts and polls forecast an ascent of the extreme right vote in the next European elections. The crisis and the discredit of traditional politics have been the breeding ground for these parties, which may earn one out of four seats in May due to the increasing anti-European feeling in the population.
MADRID | By Julia Pastor | Spain could cook a historical fiscal reform to simplify complex patchwork of tax rates at national and regional level- there are more than 1,000 tax exemptions, even more than in the UK, which was the European country with the highest freedom from taxation-, and increasing revenue collection efficiency. Spanish market watchers are looking forward to see reforms in the 444 pages report presented to the cabinet by an experts committee. However, critics fear that social policies, especially those focused on employment, quality of labour force or further specialization, will be ignored. As the rest of euro zone’s southern countries walk over the same path of Spain’s, a real harmonized fiscal union still seems too far.
MADRID | By The Corner Team | Scandals such as Bankia’s selling preference shares to thousands of Spaniards who had no clue of what they were buying will not happen again, hopefully, if this new plan works: the country’s regulator will send spies to watch how the banks sell financial products, and to what extent their staff knows what they are. The Netherlands, Belgium and France have already implemented this ‘007 method’.
MADRID | By Julia Pastor | Amid the debate on the euro zone’s eventual japanisation due to low inflation levels, we wonder if Spain could be the first member state with severe signs of this illness. Inflation is near 0% since six months ago and markets’ expectations suggest an average price index scarcely over 1% for next five years, and under 2% in a decade. Along with Portugal, Spain is the EU economy having more price indicators’ components in red year-on-year rates, namely 40% against 20% of Europe’s average. That means that 2 out of 3 goods in Spaniards’ shopping basket are affected by deflation. Although good for the country’s competitiveness, there is a risk in the process of public as well as private debt deleveraging.
ATHENS | By Nick Maltkouzis | The social cost of the crisis in Greece is often hidden from visitors and casual observers. In fact if one excludes some parts of Athens and other big cities, the signs of the crisis are not always that visible. However, an increasing amount of Greeks are finding themselves socially excluded. According to the latest figures from the Hellenic Statistical Authority (ELSTAT), 34.6 percent of the population was considered to be living at risk of poverty or social exclusion in 2012, the highest proportion in the European Unión.
MADRID | By The Corner Team | Greek billionaire, investor, philanthropist and speculator Geoge Soros is well known for his pessimissm towards the euro and his enthusiasm for getting headlines. During a visit to London for his book tour, he made a case against the excess of austerity in the eurozone and critizised the recipes imposed by the German Parliament on its neighbours like Spain.
MADRID | By Francisco López | The climbing of euro against U.S. dollar is increasingly worrying market strategists as it can affect negatively prices and loss of competitiviness in the euro zone. Conversely to the ECB, which has decided not to intervene exchange rate. “It is out of our mandate,” Draghi assured last Thursday, “unless it damages prices’ stability expectations or economy growth.”