From Cannibalism to Capitalism IX

When men exercise of Gods II


Several international financial analysts and even the annual report of American State Department  against the drug market, says that the guilty of the “housing boom” is not the official bank, but the so-called “black money” fruit of the illegal economic activities, such as drug trafficking, despite three years ago was a thing known:

“The group of financial technicians  from the Ministry of  Economy and Finances (GESTHA) thought that speculation in the housing sector and rising house prices, an overvalued between 24% and 35% approximately, are largely a consequence of treatment “inappropriate”  of  the taxes on the transfer of immovable property in Spain.
Technicians of Finance estimated that an effective taxation of real estate transactions by value added tax (VAT), the transfer tax and documented legal acts (ITPAJD) and the Income Tax of Individuals (income tax) would slow speculative operations which have a significant impact on creating demand “artificial” and promote “real estate boom, ‘where the black money has found a refuge profitable. (05/10/2005 09:30:50 – Goodwill Communication). ”

Throughout the time that has lasted for the housing bubble, there has been more or less tacitly complicity on the part of politicians and banks that have allowed it(if you have not benefited in fact) but now they intend to make us believe to the rest of the people, that it is not so simple:

“In this sense, what Gestha states, it has been fostered over the development of the sector through certain tax policies to constructor sector in the search for an engine of overall economic growth detrimental in other sectors. At present, about 14% of GDP comes from the construction and housing sub-sector is 40% of this figure, ie 5.6% of the overall economy. ”

However, the bank argues, without the slightest compunction:

“The Spanish Mortgage Association (AHE), which represents banks and credit cooperatives, said yesterday that Spanish families less buoyant ” have nourished and sustained ” the housing boom.” (23.04.08-JDA “daily Rioja)

They say now that people ventured with disproportionate mortgages they could not afford, but what they do not explain is, why they allowed the flood of risky credits?,(Banks are usually reluctant to grant them) .” Now they say have realized that housing and insurers should have capital to face the risks that banks now face. How is it that companies have no capital to take over a significant percentage of the economy?.

While the bubble is finishing in United States, observers, from the rest of the financial world have taken note, and the international banking aware from the outset of the disaster that was coming, had no shame in taking part in this game:

“Interestingly, the rise in prices slowed demand, is usual in any market. The reason was simple: the buyer could find financing easy to a single digit, while the value of their home rose at a rate of double digits per year. For example, if in 2004 an investor looking for funding in the U.S. could find loans of around 4%, while the average house rose by 14%. Too easy and attractive to not buy the house. “(Felipe Sanchez Coll, Professor of FEBF).

It is a problem that began in 2001, Have not had time to tackle it, or have not wanted?. In that moment, the bank, making use of the picaresque and in a pure Homer Simpson style, he passed the ball to the financial markets, packing those risky loans (which is a “authorized transaction”):

“… Values which were created specifically for this purpose were called MBS (Mortgage Backed Securities) and sold to investment funds, venture capital, financial enterprises ….” (Http:// / 2008/05/es-alan-greenspan-el-culpable-de-la.html).

They say that rats are unclean animals among other things because when a boat sinks, are the first to leave. Any attempt to parallelism is misplaced, because the rats are not the owners of the boats, neither have reserved for themselves, all the lifeboats.