Crossroad - pest or cholera?

In this article in SvD argues that the Euro mainly has two alternatives to solve the crisis. Disintegration of the euro (allowing for, for instance, devaluation in certain countires) or centralization (where debts are shared within the Euro zone, but the national banks loose a large part of their present independence).

Thereafter, in another article, the same author describes the consequences he sees from the two different alternatives.

In short term, the disintegration would mean big troubles for southern Europe, Spain included. "A deep and long recession", as he describes it. But after some years it would be replaced by a new working economy and working inter-state relations.

Meanwhile, the centralization alternative (or "Brussels takes the power", as the author calls it) would avoid the deep crisis in the southern countries in short term. However, this alternative would, according to the author, doom the southern Europe to a permanent poor state, with high unemployment and low productivity.

That's it. Two alternatives. Pest or cholera. Real hardship during some years and from there building up a working economy. Or dooming the Southern Europe to permanent poverty (compared to the Northern Europe).

If these really are the two alternative (I am not the one to judge), it seems like a easy choice, even if it is made with heavy heart.

But, according to the author, Souther Europe will probably be doomed to "eternal" poverty. All powers (the market, the politicians, the industry, the establishment) are short term centered. Nobody have anything to win on choosing a long term solution which will mean hard ship in short term.

So, if we are to believe this author, Southern Europe will always be a low producing region of Europe, with lower salaries (and prices). A good place to retire (if you get the retirement money from Northern Europe) and to have vacations. But without any real industry to compete with the Northern Europe.

There seems to be no happy end to this crisis.

Spain pre-crisis (crazy)

Yesterday I saw a documental from Antena 3 called "El dinero que no debimos gastar" (The money we shouldn´t have spent).

What can I say? A lot of it I already knew. But to see it all together, and with such a detail, left me shocked.

Included in the program:
- the abuse of armored cars (estimated to 5000 at a cost of approx. 48k€ per year).
- the uncontrolled construction of regional airports (49 airports in Spain when, for instance, Germany only has 24. Closest to Spain is UK, with 33 airports).
- the "city of culture" in Galicia
- the municipality (La Muela) that paid vacations in the Caribbeans for its inhabitants (among many other excesses)
- highways without traffic
- La nueva Mestalla de Valencia

Having in mind that this is only the top of the iceberg, it's easy to get speechless (or breathless).

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The whole program is impacting, but what striked me most was the part regarding the City of Culture in Galicia.

So I searched some more videos on this.

07º SALVADOS 11-Marzo-12 3/4 MANUEL CHEDA PERIODISTA en LA CIUDAD DE LA CULTURA

07º SALVADOS 11-Marzo-12 4/4 MANUEL CHEDA PERIODISTA en LA CIUDAD DE LA CULTURA

Also, in English, a program called "Extreme engineering" which partly explains why the "City of Culture" is so expensive (300M€ and increasing).

Spanish chulos

“Sometimes you have to explain things to Mr. Juncker,” De Guindos sarcastically told Spanish daily El Pais, noting that it was unnecessary to detail a precise plan for the banking bailout before Monday, as Juncker had asked. (link)

Juncker being the Eurogroup President, such a phrase seems a little "chulo" having in mind that De Guindos soon is to receive more than 50b€ to save the Spanish banks.

Having in mind that it is possible that Spain soon will have to ask for more money to bail out Spain, it could be interesting to see how long it takes before De Guindos will have to eat his own words. In his situation I'd be less "chulo".

However, as this article says, to be "chulo" seems to be a requirement to be a politician in Spain.

Unsold houses - the phrase of the day

From Forbes:

"Spain is thought to have more unsold housing stock than the United States has – with a population one tenth of the size -  in a country where unemployment is now over 24% and household debt is around 125% of household income. Spanish banks hold the majority of that fragile mortgage debt."

How serious is the crisis in Spain?

First, 

a majority of analysis's agree in saying that the Spanish crisis is not, mainly, caused by reckless state finances (I mention this, as it gives some kudos to the Spanish politicians that I was not willing to give them. The Spanish system gives a lot of economical freedom/responsibility to majors of any local council which allows for a lot of unnecessary spending on Fiestas, Bullfighting and fireworks.)

Second, 

the main problem in the Spanish economy is, and here I agree totally, the construction boom which was mainly financed by loans.

This construction boom was made by private companies/persons and private money. But also here I think that the politicians have a great part of the responsibility. As the local councils are financed, they earn money on allowing terrain for construction, and budgeted every year for more construction, promoting the construction boom (I won't even mention the dirty secrets of how these constructions also financed political parties and even specific persons under the table).

At some point this construction bubble had to burst. During years I kept saying that "the sooner it bursts the beter" as the consequences would be less serious. Unfortunately, it happened rather later than sooner, and now the burst is rather as an nuclear explosion. In the face.
At this point the banks are sitting with a huge stock of buildings and homes which they have financed.
The value of these buildings and homes is registered as an asset. In theory, that is alright. If, at some point, the bank would need money it could sell of some of those buildings to it value, and everything would be alright.
However, and here is the problem. There are no buyers, at least not to the price that the bank is trying to get. (i.e., to the value they have given the buildings in their books).
So, the banks will have to lower the price. Once they have to start selling of buildings to the price that the buyers are willing to pay, they will have to adjust the value of all their assets in their books and the books will look a lot worse than they do today.

So here comes the million dollar question. How bad will it be?

I.e., how much capital must be injected in the system to overcome the crisis?

Unfortunately nobody has the answer for that question at this moment. And there are a lot of guesses out there.

I've read anything from 50b€ to 500b€, but no real consensus on any of these numbers (the 50b€ number seems to be overridden at this point Bankia alone is needing 25b€)

The Centre for European policy studies (CEPS) has an approach to estimate this.

By identifying the "overhang" ("overhang" defined as the investment in construction, as % of GDP, that is higher than the the average between 1970-2000), CEPS think that they can identify how much construction the market must absorbe before the market can start working well again.

According to this estimate, CEPS has come to the conclusion that the overhang in Spain is equivalent to about 380b€ (37% of GDP 2010).

EPS also says: "It goes without saying that our estimated total of €380 billion exceeds by far the provisions and write downs accumulated by the Spanish banking system (and in particular the savings banks) so far."

The key to the recovery is the "absorption" in the curve. 

If, for instance, the banks (and other stakeholders) just writes down the assets with 380b€ and takes that as a loss of 2012, then 2013 will be a fresh start.

That is of course not possible. The banks don't have that kind of money and would go bankrupt, which would harm "normal people" who's money has been used to finance that overhang.

The state could, of course try to help the banks, or the "normal people"... but having in mind that we are talking about 37% of the GDP, it is not something that can be done over a year.

it seems like we will live with the "absorption" during some years. How many years depends on how deep the "absorption" is. With the presetn rythm, CEPS estimates that Spain will not recover until year 2030!!!!

For more information, download the report on following link.

Internet trends according to Mary Meeker

Too good to not share:

Priorities in the crisis

Tough times require tough decisions.

It also requires that you have your priorities right.

So, what are the priorities of Rajoy? Let's see some examples:

• The subsidies for Science & Technology (including R&D) has been cut by 26% (Link)
• The budget for education is cut by 3.000 M€ (Link)

• The Catolic church will see no cuts in their subsidy of 156 M€ (Link), neither will they have to pay taxes for their buildings, which would be around 5 M€ (Link).
• The Comunidad Autónoma de Madrid (CAM) increases their susidies for bullfighting (Link).

To be fair, not all these are decisions of Rajoy, but the increase of bullfighting subsidieries clearly could seem like an insult to many who are suffering the crisis. Rahoy should know that, and if Rajoy has no influence over Esperanza Aquirre, then he should resign.

The winner takes it all

This impressing graph shows how Apple and Samsung takes 99% of the revenue generated by the smartphone market.

"Stress test" - my ass

So, 11 months after Bankia passed the famous "stress test" imposed by the European Banking Authority (EBA) the Spanish state now feels forced to save the bank by taking a 45% stake in the bank (converting state-backed loan of 4 456€ to shares).

What the f**k did the "stress test" test, if it was not able to detect something wrong in a bank which, 11 months after, is described in the following manner by the Wall Street Journal: "...Bankia encapsulates all that has gone wrong with Spain's banking system." (Link)

Why should we trust any of these "quality stamps" that states or Europe willingly hand out, if we time after time can see that the quality of the quality stamps is, at the very best, questionable. Obviously these tests are made to calm down people for a while, rather than actually detect "rotten apples" in the basket.

There were voices already from beginning saying that the test was too lame (For instance, The Economist). Why did nobody listen to these voices?

I always try to teach my daughters to tell the truth. A person who lies will always know inside their heart that the have been dishonest.

But, in cases where a lie might be a way to avoid a worse situation, I also recommend them to never lie about anything that soon will be known anyway. Those lies will only make you look like a fool and non-worthy of your trust. As EBA right now.

Mindcontrol

I found this interesting video on TED.

What I learned by watching this video:

• There is a part of the brain called "Right temporal parietal junction" (RPTJ)
• The RPTJ is located just behind the right ear. (See image.) 

• The “RPTJ” is dedicated to understanding what's going on in other people's minds and forms our thoughts about it.
• For instance, when judging peoples actions this is the part of the brain which helps us understand why a person has made harm (for instance if the harm was made by mistake).
• In children, the RPTJ is still not dedicated to understand other people in the same degree. This can be measured in the brain (see image below), as well as observed through behavior (judgement of people who makes innocent mistakes, see video)

• With the RPTJ "less active" people will judge mainly based on the outcome. I.e., there is less comprehension for the "guilty" person in case of an accident. (The case mentioned in the video is a person that thinks she is giving sugar to a friend but actually, unintentionally, is giving her poison.) 
• It is even possible to find a correlation between activity in the RPTJ and the "understanding" of unintended accidents. (See image)

• If the RPTJ is distorted (in the experiment, by magnetic fields) people tend to be more judging. 

How to keep your husband sober...

Ok girls. You don't want your husbands/boyfriends to get too drunk on that party? Here comes a clue.At least if he is a fly.

http://news.sciencemag.org/sciencenow/2012/03/sexually-rejected-flies-turn-to-.html

Frans de Waal on TED: Moral behavior in animals

I have read one book by Frans de Waal (Chimpanzee Politics: Power and Sex among Apes) and I liked it as it approaches a complex area with a sense of humor and "down-to-earthiness" which makes you see how similar to us the monkeys are to us (or, rather, we to them).

I was glad to see that Frank had made a presentation on TED last November.

Especially I liked the experiment which showed how the Capuchin-monkeys have a sense of Fairness (12:40).

Spain's death spiral?

Michael Schuman obviously is not too optimistic about Spain's future. Here is an article of him in Time.

Some phrases:

"by tanking the economy, the austerity measures are making Spain’s financial standing weaker, not stronger. Despite its new austerity budget, Madrid estimates that the government-debt-to-GDP ratio will INCREASE in 2012, to nearly 80% from 68.5% in 2011. Simply put, Spain is moving backwards."


"When Spain announced it would miss its 2012 deficit target recently, its euro zone partners showed no mercy. [..] Rather than acknowledging the extreme suffering of their Spanish brothers-in-arms, they criticized Madrid and pressured the government into further budget cutting. The government in Madrid, fearing a split with the top brass of the zone, were compelled to cut even deeper. The euro zone is, effectively, administering the poison killing off one of its proudest members."


"What the pain in Spain shows is the folly of the Berlin-backed, rules-based, austerity-crazed response to the debt crisis. Yes, Spain is responsible for its own problems. But Spain is no Greece, either. Unlike Greece, Spain has no history of fiscal irresponsibility."


"The monetary union has become a place where the countries that benefit from the euro grow fat and refuse to share the spoils with their starving compatriots."

Semana Santa, contradictions in Bible and tradition

Being Spain a Catholic country, I am often surprised by how little the Spaniards know about the Bible. 
I think that the phrase below (from here) summarizes one of the main reasons for this.

• One of the great differences between Protestant and Catholic doctrine is in the area of Tradition. The Protestant church maintains that the Bible alone is intended by God to be the source of doctrinal truth (2 Tim. 3:16). The Catholic Church, however, says, "Sacred Tradition and Sacred Scripture make up a single sacred deposit of the Word of God . . ." (Catechism of the Catholic Church, paragraph 97.).

This means that the traditions of the church is as important as the writings of the Bible. Mostly the traditions add on to what the Bible says (for instance the "perpetual virginity of Mary") but sometimes the tradition even comes in contradiction with the Bible (actually, the "perpetual virginity of Mary" is in conflict with the fact that the Bible mentions siblings of Jesus at a number of occasions).


In those cases that there seem to be a contradiction between traditions (doctrins) and Bible, the Spaniards mostly are not aware about this. They only know about the traditions, not what the Bible says.

Therefore the doubts and conflicts that exist around the Bible in general, and the Holy Week in specific, are by large unknown by the Spaniards.


One of the clearest contradictions  regards which day Jesus actually dies, and when he was resurrected.

• The claim that Jesus died on a Friday is based on the statements that Jesus died on the "preparation day" (Mark 15:42) before the Sabbath, understanding Sabbath as Saturday.
• The claim that he resurrected on Sunday is based on, for instance, Mark 16:2 where it says that "Very early on the first day of the week, just after sunrise," Mary Magdalene, Mary the mother of James, and Salome found the resurrected Jesus
• The claim of resurrection after three days is based on Matthew 12:40 where Jesus says that  "the Son of Man will be three days and three nights in the heart of the earth" [before resurrecting].

The fact that there are not three days and three nights between Fridy and Sunday doesn't seem to bother anyone.

There are more contradictions regarding the  day of Jesus´ death.

• According to Mark, Jesus was cruzified the day after the Passover meal (the Last supper was the Passover meal). [Mark 14:12, 15:25]
• According to John, Jesus was cruzified before the Passover meal (throughout his Gospel John calls Jesus "the lamb of God" and, at the end, he makes the point that Jesus died at the same time as the Passover lamb is sacrified.)

Other contradictions regarding Jesus last day:


Who carried Jesus' cross?

• Did he get help from Simon of Cyrene? (Mark 15:21, Matthew 27:32, Luke 23:26)
• Or did he carry the cross the whole way? (John 19:17)

What inscription did Jesus' cross have?

• “The King of the Jews.”? (Mark 15:26)
• “This is Jesus the King of the Jews.”? (Matt 27:37)
• “This is the King of the Jews.”? (Luke 23:38)
• “Jesus of Nazareth, the King of the Jews.”? (John 19:19)

Was the women close to the cross, or far away?

• Some women were watching from a distance. Among them were Mary Magdalene, Mary the mother of James the younger and of Joses, and Salome. (Mark 15:40)
• Near the cross of Jesus stood his mother, his mother's sister, Mary the wife of Clopas, and Mary Magdalene.  When Jesus saw his mother there, and the disciple whom he loved standing nearby, he said to his mother, "Dear woman, here is your son,"  and to the disciple, "Here is your mother." From that time on, this disciple took her into his home.(John 19:25-27)

Which were the last words of Jesus?

• “My God, my God, why hast thou forsaken me?” ( Mark 15:34-37, Matthew 27:46-50)
• “Father, into thy hands I commit my spirit.” (Luke 23:46)
• “It is finished.” (John 19:30)

What happened just before and after Jesus died?

• At the sixth hour darkness came over the whole land until the ninth hour. (Mark 15:33)
• At that moment the curtain of the temple was torn in two from top to bottom. The earth shook and the rocks split. The tombs broke open and the bodies of many holy people who had died were raised to life. They came out of the tombs, and after Jesus' resurrection they went into the holy city and appeared to many people. (Matt 27:51-53)
• darkness came over the whole land until three in the afternoon, for the sun stopped shining. And the curtain of the temple was torn in two. (Luke 23:44-45)
• Nothing worth mentioning (John) (One would think that an earthquake that resulted in many people raising from the death would be worth mentioning, even outside the Bible). 

Who discovered that Jesus had resurrected?

• Mary Magdalene, Mary the mother of James, and Salome? (Mark 16:1)
• Mary Magdalene and the other Mary? (Matt 28:1)
• Mary Magdalena? (John 20:1)
• Luke just says "the women" without specifying

What happened when Mary Magdalen (and her possible accompanions) went to the tomb?

• According to Mark: They saw that the stone, which was very large,had been rolled away. Inside they met a man in white. The man told them to tell the disciples to go to Galilee to meet Jesus. The women were so afraid that they told nothing to anyone. (So how do we know this if they never told anyone?)
• According to Matthew: The two Mary's saw an angel roll back the stone, causing an earthquake, and sit on it. The angel told the women to that Jesus had risen and that they should tell the discipes to meet Jesus in Galilee.
• According to Luke: The women saw that the stone was removed and entered the tomb. Inside they first saw nobody, but thereafter two men appeared for them. When they bowed in fear the men remembered them that Jesus already had told them that he was to raise on the third day.
• According to John: Mary Magdalena saw that the stone had been removed from the entrance and ran to Simon Peter and the other disciple, the one Jesus loved, and said, "They have taken the Lord out of the tomb, and we don't know where they have put him!".  Peter and the other disciple ran to the tomb and they saw that Jesus was no longer there.
  First when Peter and the other disciple had gone Mary Magdalena saw two angels, seated where Jesus' body had been, one at the head and the other at the foot.

The Gospels also describe Pontus Pilatius role very differently, putting more guilt on "the jews" and less guilt on Pontus, as time passed between Jesus' death and the actual writing.

The phrase of the day

"... If there is one thing the world has discovered about poverty reduction in the past 15 years, it is that development is not something rich countries do to poor ones. It is something poor countries manage for themselves,..."

http://www.economist.com/node/21551490

WTF? National geographics goes superstitious?

The last edition of NGM spent a big part of the pages to just uncritically diffuse the catholic superstitious message regarding the different apostles. Must I end my subscription?

The Apostles - Art Gallery - Pictures, More From National Geographic Magazine