Wednesday, 6 June 2012

This is why Spain is in such a mess

SPAIN If you click on this link, you will see 25 photos of buildings, urbanizations and developments abandoned to the wind and sun after their developers either disappeared or went bankrupt or whatever. These pictures were taken in the province of Málaga only. There are some 14,000 new homes all over Spain (10,000 in Málaga alone) that have remained unsold, and are likely to remain so for some time. One of the main reasons Spain is in huge financial trouble, aside from a hemorrhage of over-spending for the last fifteen years or so, is that these empty buildings have not been paid for. Like the 'sub-prime' scandal in the US, where it all started, the banks lent money without the certainty of getting paid back. Sure, lending money is risky>>>
- but lending it when you know you're not going to get paid back is just plain stupid. The banks have these properties listed on their books as assets - but at the prices that they were set at a good couple of years ago or more, not at their present value, which is down by at least 30 - 35% and expected to get worse. And now the banks want our money to get out of the mess they got themselves into without any help from us. We're not economists or financiers here, but we and you, Dear Reader, have more common sense than those bankers who are now heading home with fabulous golden parachutes - and here is their own gallery of rogues. They know where their next meal is coming from, but our next door neighbours don't. (Image source: LibertadDigital)

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