What may be the causes of the current crisis?

Has the main crisis exit mechanism been taken from Spain?
Based on the exceptional writing of Jordi Catalan. Excellent summary of the possible reasons that have led us to the crisis and those that do not allow us to finish poking the head.

Real estate speculation.

A determining factor, present in many countries, has been one of the triggers of this economic depression (always speaking in relative terms). Focusing on Spain, the formation of an alarming bubble; As I have said before, has been, if not more, one of the pillars of the crisis. Speculation with the land and its great short-term profitability (In periods of economic growth) for our dearest credit institutions, was an enormous concession of loans unpayable for many people.
China, the Asian giant, the engine of exports today, may be a reason for the deindustrialization of the countries of the West. Why? China is a country that has industrialized at a great speed, taking the lead in the West in matters of: Production, competitiveness, prices… Western industry has been depleted by the great supply and the great competitiveness of its prices. These factors have given a great deal of room for improvement and action, for example the purchase of Western debt. As a fact, as Catalan says, every American (approximate data) owes 40,000 US $ to the Chinese state. In the national aspect, it should be noted that the entry into the Chinese market was, to a large extent, an industrial crisis that caused thousands of closures in Spanish companies.

The adoption of the euro, what a nice coincidence. One of the great mistakes that has left Spain, if I may express, with the ass in the air. The main key to the exit from the crisis in our country has always been (Without exception) the devaluation of the national currency and the increase of tariffs. Today, with the euro, it is practically impossible. We are subject to an austere economic policy, which after years of great crisis, is considered for the current course, timid inflation processes. Remains of hyperinflation in postwar Germany? Who knows … Make it clear that from the beginning, entering the euro as it was done, was a mistake. Why? Enter with a parity of 166,386 to 1, for example. That the majority of commodities increase by 350% on average, reduces the savings of a nation and its people.
On the other hand, leaving aside monetary policy and foreign competition, the free capital market. Gentlemen, you just need to read a history or economics book to understand what has happened. I believe that very few people will disagree that the free market only brings problems; Nevertheless, to return to fall in the same errors that in 1929, it’s like being a fool. The emission of toxic assets, a cruel reality. Emit, emit, emit and continue emitting as if there were no tomorrow, can lead to disastrous consequences.

Here is my humble contribution to the causes of the current crisis. As always, I leave the motives to your free will.

RUI QUIM

Team Economists GRUPO VISTO, S.L