The head of the Regional Statistics Department at the Establishment of the Savings Banks (Funcas), Pablo Alcaide, appears to be the most far-sighted and/or sincere and/or realistic economist with links to the banking sector.
Among their statements, we find, for example, that Spain faces many years of low growth, that the worst of this crisis will be seen in the coming quarters, or that the Spanish economy will bottom out by the end of 2010. These may be obvious points, but they are a sign of candour when they come from the world of banks and building societies.
Just one objection, when he highlighted the advantages of being in the European Union and using the euro: «»…although this prevents us from using the exchange rate, the fact is that if Spain were not under the umbrella of the EU and the single currency, the current crisis would be comparable to that of 1929…” In my humble opinion, the crisis is indeed comparable to that of 1929 in quantitative terms, though not in qualitative terms, as this time it is the system itself that has collapsed, and not simply the stock market. And on the other hand, the new era of devaluations It is taking place, not only informally, but also at the expense of the single currency.
Alcaide also called for public investment, given the foreseeable lack of private investment for many years to come. However, and this is significant, we must neither expect nor seek to encourage private consumption to revive the economy, because it is not in families’ interests to continue at this rate of borrowing. Private consumption cannot and must not be allowed to diverge from savings for any longer. And that concept clashes head-on with the profits of banks and building societies.
Although I do not agree with them entirely, these statements—which steer clear of politically correct lies—are welcome in any case, even if they come from the Savings Banks Foundation. Nevertheless, the gossipmongers they’ll say that people never lie on his deathbed…
Yours sincerely, Mr Pablo Alcaide.