The explanations offered by economists for the financial crisis only serve to understand how the whole house of cards fell down… but the earthquake that caused the collapse is a crisis of values that affects us all.
In the last quarter and for the first time in 15 years, Spainâ??s GDP has fallen. Numbers are never wrong. Political debates more concerned with words and appearance than the actual situation have come to an end.
We have reached this situation thanks to a chain of different factors. A financial crisis that arises from the appearance on the market of the so-called Â´toxic assetsÂ´, which generates a loss in confidence, deterioration of bank balances (to the point of bankruptcy in some cases) and a loss in liquidity.
This situation permeates the real economy. Even with business models of proven success, many companies are asphyxiated by the lack of credit they need to balance their cash flows and, in the best of cases, they decide to adapt their costs or even close down, leading to more unemployment and less business activity, which affects suppliers. On the other hand, we have individuals with less purchasing power due to a lack of confidence or the effect of the increase in the price of money or less capacity for generating revenue. A vicious circle. The Spanish economic model, so dependent on construction, which has fallen to the deepest depths, domestic demand and tourism, both affected by the consumer crisis, has inevitably fallen into a recession.Details