While the banking system in Europe is expected to reduce the amount of their assets with a value of 2.6 billion euros, representing 7 percent of bank assets. The European Bank will start selling its own securities. This will reduce the amount of lending between banks. Finally, to reduce the amount of the loan portfolio. This will reduce the loan in a foreign country. Especially in Eastern Europe before. Then came the credit in their own country.
However, the economic policy of the euro in the lack of progress or the wrong way. Bank of Commerce, the European system will reduce the amount of net loans increased from 2.6 billion euros to 3.8 billion euros, a figure representing 10 percent of the assets of banks quite the impact on the real economy. If economic policy is the way. GDP of the euro at the end of 2013 will be 0.6 percent higher than current estimates, on the other hand, if the economic policy of the euro is the wrong way. GDP of the euro at the end of 2013 will be reduced from the current estimate of 1.4 percent.
I turn to look at some of Spain. The most important question now is that the Spanish government’s decision to save the government money. To the global economy. Back to the stable. Many people think. Could not be said, is to cut government spending will aggravate the problem of unemployment rose to nearly 25 percent on weekends. The cause of the Spanish economy is not Lgmtaggiืn.
The notion that the government debt level is manageable. The interest burden of the debt of both public and private sectors. In the not too high. The real reason that many of the major problems in the Bank of Commerce, however, the question is returned to the advantages and disadvantages of the belt. What is actually more than that.
Recent studies of the IMF’s economic policy was to keep it as current. Commercial Bank of Spain lending system is reduced by about 4 percent, as Figure 2 is a compelling public policy. The credit value is reduced by about 6 percent, which means that Total loans of commercial banks in Spain will be reduced by at least about 180,000 million euros, it is estimated that Spain’s GDP will shrink by around 60,000 million euros, or about 6 percent of GDP, which was calculated as the difference between interest rate loans. The government will be about 2-3 percent.
Or it can be said that Spain’s policy to save the results. In that case, if not used. The spread or the difference in interest rates, government debt exceeds 3 percent, or say that the Spanish government used force to prevent the interest rates Spain, up to 8 percent more than the interest rate government bonds in the age of 5 years. Currently about 5 percent.
I turned to see in Figure 3 shows that the interest rates Spain, down to measure low interest loans of the European Central Bank to financial institutions in Europe or LTRO about 1.5 percent after it up to a maximum of 6.7 percent there. The Spanish government does not believe that. Spanish economy to be worse than the end of this year, at least to the second count only the cost of the policy of compelling the Spanish government of the prudent. I know many of you think that the Spanish government the wrong way. The event may escalate to that point. The economy of Spain, it may be more vulnerable to such provision.
The figures are consistent with estimates of the Spanish economist Luis Garicano. Once a week ago. Calculated that the Spanish government will be able to reduce the government deficit from 8.5 percent to 5.3 percent, down 3.2 per cent of the GDP. The value of the net budget is not reduced to 32,000 million euros (Spain’s GDP is currently around one trillion euros), but if you imagine the impact. In the dynamics. To reduce the deficit. 53000-64000. Million euros, ever.
In personal opinion. I believe that the problem of Spain. The problem is that the government has more than externally (Asymmetric Information), although many of you would know that the Spanish government to resolve the debt before the rot in the financial sector. The main problem is there. I believe that the Spanish government, which is exactly like that, but I think this is important. The problem is that the Bank of Spain seems to be worse and more complicated than the numbers that you see. Regardless of the real estate debt. Unemployment was high and the structure of financial institutions in the regions. Quite complex. The Spanish government did not want to start from this point. But let’s start from the government’s debt before then may have a more current overview of issues in the next
Let me summarize briefly the problem of Spain. If measures are not taken to save it or not. To obtain a seed grant from the Euro. The probability that alternatives to it.