Tuesday, April 01, 2008

Economic news: bad. Unemployment has reached 9%, up from 8.1% this time last year, and higher than any other EU country except Slovakia. Meanwhile, new car sales are down 28% over this time last year, with 4x4 sales down more than 40%. The automobile sector claims it's because Semana Santa fell in March this year, and so there were three sales days less than in March 2007. Yeah, right.

The Independent headlines, "USA 2008: The Great Depression." Yeah, more wishful thinking from the British press: what pisses me off is that they want it to happen. They want Americans to be poor and suffer deprivation. It would please them no end if one-third of us were unemployed like in 1932. Of course, nothing of the sort is going to happen.

Check out their evidence: The number of Americans on food stamps has increased from 26.5 million to 28 million--still less than one-tenth of the population. That's all they've got to base their screamer front-page headline on. Wonder where the praise for the American system of feeding the poor went to? If, say, Venezuela or Cuba were passing out food stamps to its poor, they'd be praising it to the skies. Of course, in Venezuela and Cuba there's no food to pass out to anyone.

By the way, most Spaniards have no idea that poor Americans get food stamps and public housing and public schools and Medicare/Medicaid. They've been told that life in America consists of cutthroat competition, and he who falls by the wayside is left to starve, and they believe it.

Econ minister Pedro Solbes stuck his neck out and claimed that Spain's 2008 growth would be 3.1%, much higher than the Bank of Spain's estimate of 2.4%. Somebody's going to be wrong and I bet it's the politician rather than the institution.

The PP is replacing Eduardo Zaplana with Soraya Saenz de Santamaria as its spokeswoman in the Congress of Deputies, something they should have done like three years ago. Saenz de Santamaria is known as a Rajoy loyalist and comparatively moderate, as well as less personally obnoxious than attack-dog Zaplana.

ADSL Internet service is 25% more expensive and 26% slower in Spain than the EU average. Spanish ADSL speed is 3 megas, whatever that means, while in the UK and France it's 8 megas. Thanks a lot, Telefonica, for crap service at premium prices. Somebody needs to go all AT&T on that company.

Check out this Yankee-bashing cartoon from El Periodico's Ferreres, about as subtle as a dose of chloral hydrate. Uncle Sam says, "You should respect human rights more," while China replies, "Respect? Like at Guantanamo? Like in Palestine?" Simply pathetic.

Meanwhile, NATO is asking some of its members to provide more troops for Afghanistan; the Americans are sending 3000, and even the French will send 1000. Naturally, they're not even bothering to request additional troops from Zap's Spain, since none will be forthcoming.

Oh, guess what. Raul is beginning the liberalization of Cuba. From now on Cubans will be allowed to stay at hotels hitherto reserved only for foreigners. If they can pay a hundred bucks a night, that is. Of course, that silly freedom of speech stuff will take a little while longer, as will the democratic elections and the rule of law.


Cristobal said...

The world likes to blame all the current economic problems on our housing/credit crisis here in the US. Seems like a similar problem could be on the horizon in Spain if it's not already contributing to the mess. Over the past six years of my travel to the Madrid area, I've seen rampant building and skyrocketing prices. How do the Spainish finance these things? Are they seeing a rise in defaults? I wonder if Spanish banks package these loans and sell them as they do here. I also wonder if the rest of Europe has seen a Spanish style real estate boom as well over the past few years. Seems doubtful that the US is alone in having a glut of bad loans but maybe they have stricter lending requirements over there. I hope they do. I'm not wishing economic problems on them. any insights?

John said...

To be perfectly honest: I don't really know much about this. Banking is not my field of expertise.

The construction-real estate boom is clearly over. I know Spain is seeing a rise in mortgage defaults and on other consumer loans not being repaid. I have read Spanish columnists who say that Spanish banks did not repackage mortgage loans to nearly the same degree as the US, but I don't personally know whether that's true.

The other EU country with a huge real estate bubble is Ireland, but they're going to have similar problems in the UK--a lot of people bought houses at speculatively high prices, and their value has dropped below that of the mortgages they took out. Other EU countries don't have this problem to the same degree, since house prices went up over the last few years, but not as enormously as in Spain.