A trivially obvious prediction following the Spanish election

The new right wing government is going to audit the books. And it\’s going to have a good look at the regional and local government books. And the utilities. And it\’s going to find that there are billions and billions more debt lying around than anyone has yet owned up to.

This much is in fact already generally known.

The question is going to be, do they find billions of debt, tens of billions of debt or, dear lord, hundreds of billions of debt?

If they believably only find billions then Spanish bonds might improve. Hundreds of billions and, well, it\’s Greece again, innit?

9 comments on “A trivially obvious prediction following the Spanish election

  1. It’s whether they have the pride to refuse benefits or not. They could find a 100bn hole if they want to maximise payments from the core, or just a few billion if they want to get themselves out of the mess without looking like a basket case.

  2. Like Greece, only more so. And the result will be the same, only more so. When will this Euro farce be allowed to end?

  3. ….When will this Euro farce be allowed to end?….

    When all other avenues has been tried and failed.

    Giving up on the Euro would torpedo the whole project. The reason being that we are always sold every EU development as crucial, or else the EU will fail, and that would mean war. Dissolving the Euro, the EU’s biggest ever project, would prove, even to the intellectually challenged that the emperor is in his birthday suit.

  4. Despite my feelings of disgust at the behaviour of our politicians (on both sides), I have to admit that I do not believe that enormous amounts (hundreds of billions) of unknown debt will come to the surface.

    A lot of debt will surface. The soon-to-be-gone socialist government has many experts in creative accountancy, but I have enough faith in the system to believe that new truly gross manipulation will not be found.

    Debt has already been discovered in autonomous regions and we have known about the hole in bank finances for ages.

    Yes debt will surface, yes it will be a lot. I don’t think it will be a totally unexpected amount.

    There is still a considerable distance in public morality between Greece and Spain.

    Mind you, I am not putting my hand in the fire for anybody.

    And on top of everything else, the elections could have been held back in September and there is a month now until the new government takes up its place. Sufficient time to buy a lot of Christmas presents for people on the way out. I suspect that a similar note will be left for the new Minister of Finance as in the UK.

    If you like a real challenge join the new government in Spain.

  5. The reason being that we are always sold every EU development as crucial, or else the EU will fail, and that would mean war.

    It’s incredible, isn’t it, that certain nations are so violent that if the Euro fails or the EU is dismantled they will immediately go to war…

  6. “There is still a considerable distance in public morality between Greece and Spain.”

    Maybe up north but down here we prefer to keep our politicians in prison or court so we know where to find them if needed.

  7. It’ll be fun to see the CiF-ers’ reactions. We’ve already had articles anticipating the election result and arguing that the protests must continue, to fight for democratic economic policies that favour the many, not the few, following this totally antidemocratic attempt by the right to seize control by…err…winning an election.

  8. Presumably the trick is to uncover enough hidden debt to discredit the socialists but not enough to spook the markets. So any connection with the published figures and the real figures will be purely coincidental.
    Same with the UK and PFI, public sector pensions, etc.

  9. Blokeinfrance has it. And this goes whether the ‘hidden debt’ actually exists or not (e.g. in the UK much PFI and public pension “debt” isn’t actually a liability under IFRS, but people like to pretend it is for political reasons)

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