Prime Minister Mariano Rajoy wants you to believe the Spanish economy is improving. One look at housing suggests any improvement is an illusion.
Here are some highlights from a translation of the La Vanguardia article Mortgages plummet 42.2% in June
The latest government figures show that in June Spain's exports surged 10.5pc from a year earlier, a boom that nearly wiped out the nation's trade deficit. Spain's trade deficit was €106m in June, a steep drop from the €2.7bn deficit registered a year earlier and a figure heralded by the conservative government of Mariano Rajoy as a long period of recession was finally coming to a close.Foundations? What Foundations?
Last month Spain's national statistics agency reported that GDP had decreased by only 0.1pc in the second quarter of 2013 compared to the first, which saw a bigger decline of 0.5pc. That and a drop in unemployment figures, largely considered to be a result of seasonal hiring in the tourism industry, are the first signs of the "light at the end of the tunnel" that the government has been promising since initiating a series of deeply unpopular austerity measures.
Ministers and officials have been keen to hammer home the message that the worst of the crisis has passed. "Our economy has turned the corner and we are at the start of a change in trends which will allow us, with effort, to create jobs again. The foundations have been laid," Rajoy said at an event in July, shortly before leaving Madrid for his summer holidays. Luis de Guindos, Spain's Economic Minister meanwhile was quick to point out that "the recession has come to an end".
"It's no secret that domestic demand remains very weak because spending is massively impaired by unemployment and austerity," Gilles Moec, analyst at Deutsche Bank, said in a recent report. "Whenever the economy starts breathing, you'll have additional pressure to start cutting the deficit, so we get in to additional austerity and spending will fall. It's going to be a choppy ride."The average Joe on the Street knows Rajoy is a liar.
But perhaps the biggest single factor hampering Spain's recovery is the crippling unemployment which, at almost 27pc, is more than twice the European average. Almost 6m out of 47m Spaniards are without a job – or a quarter of the workforce – and many labour market economists believe that those numbers are unlikely to change dramatically even once Spain returns to growth.
Spaniards on the street scoff at proclamations of an end to the crisis. "Until the time comes when I don't need to worry how I am going to pay my mortgage and feed my family, then I won't believe what this government says about the crisis being over," said Mercedes Rivas, a 39-year-old supermarket worker from Madrid. She is the sole bread winner in a family of five, after her husband lost his job in construction four years ago, and earns just €800 a month.End of Recession? When?
(An important interview) Saving the Net from the surveillance state (And Crony Media): Glenn Greenwald speaks up (Q&A) | Nick Sorrentino