Post by rojonihafsa1 on Mar 12, 2024 3:33:56 GMT
In the absence of a trigger, the Spanish economy now has all the ingredients to suffer a debt crisis: Spain has a public debt at historic highs and an excessively high structural deficit, unrealistic 2023 budgets in an environment of uncertainty and risk of recession , a path of fiscal consolidation that is conspicuous by its absence and an electoral calendar that threatens to destabilize yet plus public accounts. "The high level of debt combined with the high structural deficit is a time bomb that can explode at any moment ," warns María Jesús Fernández, senior economist at Funcas. Elon Musk asks his employees to imagine they have bombs strapped to their heads to work faster Turbulence in the markets: the breeding ground First of all, it is worth looking around: war, energy crisis, uncontrolled inflation , historic increases in interest rates , threat of recession... The succession of catastrophic misfortunes experienced in recent times have fertilized the field of uncertainty, and there is nothing that causes hives in the markets more than that word: since uncertainty is the daily bread, investors have their sensitivity to bloom.
of skin. "Right now, anything that generates distrust can be the spark that blows up the financial markets and the debt crisis, and that can happen here," warns Fernández. This is the case of the United Kingdom, which in October was on the verge of a Black Friday in Jamaica ****** Number List advance, but a bad one: the announcement of a new budget for 2023 with a tax reduction not seen in decades unleashed a financial earthquake that was on the verge of concluded with the intervention of the Bank of England itself and was crowned with the resignation of the newly elected prime minister, Liz Truss . "If this measure had been announced in 2016, nothing would have happened, but since the rate increase, the markets are in a very flammable situation ," adds Fernández. Both the Bank of England and the European Central Bank have taken a u-turn in their monetary policy : the end of debt purchases, added to the historic rate increases, can generate seismic movements in the markets, giving rise to panic sales.
Is there a risk of an Italianization of Spanish debt? How the rise in rates and the risk premium affects the economy If what happened in the United Kingdom happened in Spain... A caricature of the former British Prime Minister, Liz Truss, who barely lasted 6 weeks in office. A caricature of the former British Prime Minister, Liz Truss, who barely lasted 6 weeks in office. What happened a couple of months ago is not a phenomenon exclusive to the United Kingdom, but the result of a lethal cocktail for the markets that could perfectly occur in Spain . In fact, now that the markets have their sensitivity to the surface, they are focusing on public spending in some countries, and Spain's is not exactly small. "The deficit and debt is a latent problem that is going to cause a lot of headaches in the future. It is not sustainable," warns Javier Ferri , doctor in Economics and researcher at Fedea. The governor of the Bank of Spain, Pablo Hernández de Cos, warned about it at the end of November.
of skin. "Right now, anything that generates distrust can be the spark that blows up the financial markets and the debt crisis, and that can happen here," warns Fernández. This is the case of the United Kingdom, which in October was on the verge of a Black Friday in Jamaica ****** Number List advance, but a bad one: the announcement of a new budget for 2023 with a tax reduction not seen in decades unleashed a financial earthquake that was on the verge of concluded with the intervention of the Bank of England itself and was crowned with the resignation of the newly elected prime minister, Liz Truss . "If this measure had been announced in 2016, nothing would have happened, but since the rate increase, the markets are in a very flammable situation ," adds Fernández. Both the Bank of England and the European Central Bank have taken a u-turn in their monetary policy : the end of debt purchases, added to the historic rate increases, can generate seismic movements in the markets, giving rise to panic sales.
Is there a risk of an Italianization of Spanish debt? How the rise in rates and the risk premium affects the economy If what happened in the United Kingdom happened in Spain... A caricature of the former British Prime Minister, Liz Truss, who barely lasted 6 weeks in office. A caricature of the former British Prime Minister, Liz Truss, who barely lasted 6 weeks in office. What happened a couple of months ago is not a phenomenon exclusive to the United Kingdom, but the result of a lethal cocktail for the markets that could perfectly occur in Spain . In fact, now that the markets have their sensitivity to the surface, they are focusing on public spending in some countries, and Spain's is not exactly small. "The deficit and debt is a latent problem that is going to cause a lot of headaches in the future. It is not sustainable," warns Javier Ferri , doctor in Economics and researcher at Fedea. The governor of the Bank of Spain, Pablo Hernández de Cos, warned about it at the end of November.