4 ms·

Hidden Data in The Spanish Economic Crisis

30 points by mmaunder 14y ago

narag 14y ago
Unfortunately, underground economy has been a problem here for long. But that's just a secondary effect of other problems, specially the dysfunctional job market. The root of the current credit crysis is no mistery. When the housing buble bursted, the banks were left with a huge number of houses that nobody could buy. Instead of accounting for the losses, they swept them under the rug, taking the houses off the market and pretending everything was fine. This was a known problem. If you can read Spanish, take a look at this blog, alerting about exactly that problem, from March 2011: http://www.jesusencinar.com/2011/03/no-me-creo-los-numeros-del-banco-de-espana.html http://www.jesusencinar.com/2011/03/no-me-creo-los-numeros-d... The title says it all: "I can't believe Bank of Spain's numbers." The autor is the CEO of idealista.com, the most important real state web of Spain. A couple of weeks ago Bankia, one of the biggest spanish banks, could not hide it anymore. That was the beginning of the end. EDIT: an interview to the same guy in English: http://www.bloomberg.com/news/2011-03-22/bank-of-spain-underestimates-lenders-shortfall-idealista-says.html http://www.bloomberg.com/news/2011-03-22/bank-of-spain-under...
Freestyler_3 14y ago
Hidden? It's the EU people looking at things with their EU glasses and the don't see any problem, they see opportunities to gain power. To bleed taxpayers out of more money and to get the local governments on a tight ship with the controlling agency that check if people are paying their taxes/ not abusing their system. And on top of that cutbacks on all the things that cost the government money. This EU ship hopefully sinks, so we can just build our own raft again. Why can't we just be all tiny countries? If you wanna be part of some big thing go live where the big thing is.
- nwatson 14y ago
  Europe eventually will move beyond the clay + iron phase of the last few hundred years and become the big thing. Powers that be will 'force everyone, small and great, rich and poor, free and slave, to receive a mark on his right hand or on his forehead, so that no one could buy or sell unless he had the mark . . .' Makes for interesting reading anyway. No more cheating on taxes in those days.
- pinaceae 14y ago
  because only this tight connection between germany, france and the uk is providing europe's longest period of peace - ever. the while thing started in the 50s and is the greatest, most succesful peace initiative ever.
  - adventureful 14y ago
    The EU integration has certainly helped, but so has the fact that Western Europe no longer has any super power nations and no single country with an overwhelming advantage. For the last 50 years the US has towered over everybody in Western Europe militarily. The US shouldering the military burden has reduced European military build-up and capacity. Effectively the same thing it has done regarding Japan (you can argue whether that's good or bad). Who's going to try to assault France or Britain anyway? They have substantial nuclear weapons capability. They'd wipe out Germany in one launch round. Then besides Germany, who else in Western Europe could even be a credible threat to peace? Nobody. So long as Britain and France have long range strike capability with nukes it'd be impossible to win a war against them, and all but makes an EU war pointless. Nobody wants to get into a war that is literally impossible to win.
moron 14y ago
I thought the "informal economies" in places like Spain and Italy was well-known. At any rate, I don't understand why a bunch of people evading taxes is supposed to make us feel better about Spain's ability to service its debt.
darkpicnic 14y ago
It's wonderful to paint an idealistic picture of a people reclaiming their economy from "evil bankers", and god knows it's wonderful to think of a new economic system that is more balanced and just, but no matter how you spin it, it's people taking advantage of a system. It's much easier and incredibly selfish to simply benefit from a broken system instead of trying to change it.
seivan 14y ago
It's a very known fact that countries like Greece, Spain Portugal and Italy do shit like this. And Swedes, Germans and others pay for it.
- hk_kh 14y ago
  If you think Spain's problem is normal people evading taxes, you are wrong. Every middle-class worker is paying taxes, and social security. The only ones not paying anything are low-class (who cares?), high-class, and extra-high-class. I am not that much into this EEUU movement of "tax the riches" but the sector of people evading taxes are right there. It's sad to read things like this, saying Spanish, Portuguese , Greek and Italian people enjoy evading taxes. Now, tell me more about MY country.
vibragiel 14y ago
I'm sorry, are those spectacular bridges, incredible amount of roads and immaculately clean cities being sustained by the informal tax-evading economy? You can't praise both "worlds" without turning a hair.
deleted 14y ago
[deleted]

30 points by mmaunder 14y ago

narag 14y ago

Unfortunately, underground economy has been a problem here for long. But that's just a secondary effect of other problems, specially the dysfunctional job market. The root of the current credit crysis is no mistery. When the housing buble bursted, the banks were left with a huge number of houses that nobody could buy. Instead of accounting for the losses, they swept them under the rug, taking the houses off the market and pretending everything was fine. This was a known problem. If you can read Spanish, take a look at this blog, alerting about exactly that problem, from March 2011: http://www.jesusencinar.com/2011/03/no-me-creo-los-numeros-del-banco-de-espana.html http://www.jesusencinar.com/2011/03/no-me-creo-los-numeros-d... The title says it all: "I can't believe Bank of Spain's numbers." The autor is the CEO of idealista.com, the most important real state web of Spain. A couple of weeks ago Bankia, one of the biggest spanish banks, could not hide it anymore. That was the beginning of the end. EDIT: an interview to the same guy in English: http://www.bloomberg.com/news/2011-03-22/bank-of-spain-underestimates-lenders-shortfall-idealista-says.html http://www.bloomberg.com/news/2011-03-22/bank-of-spain-under...

Freestyler_3 14y ago

Hidden? It's the EU people looking at things with their EU glasses and the don't see any problem, they see opportunities to gain power. To bleed taxpayers out of more money and to get the local governments on a tight ship with the controlling agency that check if people are paying their taxes/ not abusing their system. And on top of that cutbacks on all the things that cost the government money. This EU ship hopefully sinks, so we can just build our own raft again. Why can't we just be all tiny countries? If you wanna be part of some big thing go live where the big thing is.

nwatson 14y ago
Europe eventually will move beyond the clay + iron phase of the last few hundred years and become the big thing. Powers that be will 'force everyone, small and great, rich and poor, free and slave, to receive a mark on his right hand or on his forehead, so that no one could buy or sell unless he had the mark . . .' Makes for interesting reading anyway. No more cheating on taxes in those days.
pinaceae 14y ago
because only this tight connection between germany, france and the uk is providing europe's longest period of peace - ever. the while thing started in the 50s and is the greatest, most succesful peace initiative ever.
- adventureful 14y ago
  The EU integration has certainly helped, but so has the fact that Western Europe no longer has any super power nations and no single country with an overwhelming advantage. For the last 50 years the US has towered over everybody in Western Europe militarily. The US shouldering the military burden has reduced European military build-up and capacity. Effectively the same thing it has done regarding Japan (you can argue whether that's good or bad). Who's going to try to assault France or Britain anyway? They have substantial nuclear weapons capability. They'd wipe out Germany in one launch round. Then besides Germany, who else in Western Europe could even be a credible threat to peace? Nobody. So long as Britain and France have long range strike capability with nukes it'd be impossible to win a war against them, and all but makes an EU war pointless. Nobody wants to get into a war that is literally impossible to win.

moron 14y ago

I thought the "informal economies" in places like Spain and Italy was well-known. At any rate, I don't understand why a bunch of people evading taxes is supposed to make us feel better about Spain's ability to service its debt.

darkpicnic 14y ago

It's wonderful to paint an idealistic picture of a people reclaiming their economy from "evil bankers", and god knows it's wonderful to think of a new economic system that is more balanced and just, but no matter how you spin it, it's people taking advantage of a system. It's much easier and incredibly selfish to simply benefit from a broken system instead of trying to change it.

seivan 14y ago

It's a very known fact that countries like Greece, Spain Portugal and Italy do shit like this. And Swedes, Germans and others pay for it.

hk_kh 14y ago
If you think Spain's problem is normal people evading taxes, you are wrong. Every middle-class worker is paying taxes, and social security. The only ones not paying anything are low-class (who cares?), high-class, and extra-high-class. I am not that much into this EEUU movement of "tax the riches" but the sector of people evading taxes are right there. It's sad to read things like this, saying Spanish, Portuguese , Greek and Italian people enjoy evading taxes. Now, tell me more about MY country.

vibragiel 14y ago

I'm sorry, are those spectacular bridges, incredible amount of roads and immaculately clean cities being sustained by the informal tax-evading economy? You can't praise both "worlds" without turning a hair.

deleted 14y ago

[deleted]