By Juan Pedro Marín Arrese, in Madrid | Spain’s government has pledged to close down 80 publicly owned enterprises, an impressive figure at face value. But most of the adjustment is grounded on the simple recipe of merging subsidiaries into mother companies. Thus the only tangible savings amount to allowances paid to suppressed Boards of Directors. A negligible €1 million cut off that will add very little in terms of budgetary…
By Fernando Rodríguez, in Madrid | Claudio Aguirre, board member at the Spanish bank Bankia confirmed in an interview with Consejeros magazine that the group intends to maintain its independence. Although the entity’s capital needs amount to about €9 billion, Aguirre says that being in a merger, Bankia could clean its balance sheet up against reserves, not only against income. What is your opinion about the third phase of the financial…
By Juan Pedro Marín Arrese, in Madrid | The Spanish government publicly claims success in limiting damage after having boldly taken the step to revise upwards the deficit target. But privately, it recognises that being forced by partners in the Eurogroup to trim it down came as a nasty surprise. Overconfidence had led Madrid to believe that the understanding attitude shown over Spanish budgetary problems would be enough to shore up…
A curated selection of links we hope can enlighten us all; some come from our corner, some do from other corners of the net. And as always, our comment widgets are anxious to get your suggestions. Anglo-Saxon banker-bashing, this time from one of them! Why a general strike in Spain is not what once was Fed’s bank stress tests? Don’t trust them The day the UK felt vulnerAAAble A review of…
Before someone else sets sight on this graph and rolls out the Armageddon tale about the fall of the euro empire because of Spain’s disgrace, we would like to make available this explanation, which came via Madrid-based Link Securities. Is this chart indicative of a trend change in terms of buyer appetite of investors? “We think not. The abundance of liquidity in the system and its channelling by the banks (mainly residents) into assets with a profitable spread, should serve to maintain the strength of demand in future Spanish…
MADRID | A plan for the restructuring and rationalisation of public sector firms become official on Friday in Spain. The government describes it as the first step of many to achieve a public network of companies without duplicities. Some of the enterprises were founded with the aim of developing activities not yet covered by private initiative and that were of national interest, but their justification is nowadays unclear, official sources said. In…
By Gustavo Matías | Professor Emeritus at MIT, Peter Temin understands why German Chancellor Angela Merkel bullies everyone into austerity. But he disagrees. Temin believes too many, too deep budget cuts can prevent countries from paying their debts as it has already been the case in Greece. So Germany could destroy the euro and put the global economy under risk? Something similar happened in 1931, also because of Germany’s influence, and led…
MADRID | Spanish Finance minister Luis de Guindos bears the unpleasant task of playing the wet blanket, being realistic, not promising anything but selling a future. His role is that of the victorious Caesars’ companion, who had to whisper in their ears: “remember you are mortal”. In the government and in front of the citizens, he is the one who spoils the fun. For that he needs a great deal of…
MADRID | Cesuras and Oza agreed this week the first merger between towns in Spain. The villages will become one local authority in a decision that was pushed by the need of public spending rationalisation, and that is likely to trigger a municipal restructuring in the region of Galicia. In fact, the president of Galicia’s province of A Coruña, Diego Calvo, admitted there are at least nine other towns currently…
By Tania Suárez, in Madrid | The new deficit targets established by Brussels left unmoved the Spanish Treasury issuance performance. It has placed €3,009.29 million in bonds and debentures at lower interests, few days after the Spanish government set up a higher deficit target for 201 and after Brussels mended it to a final 5.3% from an initial 4.4%. Specifically, the Treasury has placed €976.18 million of the €4,031.18 million…