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Spain: Too Big to Fail and Too Big to Save (Cash transactions over 2500 will be banned)
April 17, 2012 | By John Mauldin

Posted on 04/20/2012 10:52:29 AM PDT by dennisw

Cash business transactions over 2500 € are to be banned, Hacienda has said they will not fine anyone who admits that they have been making payments of more than 2,500 € over the previous three months. The cash limit is part of the Governments anti-fraud plans which have been approved today. Those Spaniards who have a bank account outside the country now face the legal obligation of having to inform Hacienda about the account. The Government hopes its anti-fraud measures will bring in 8.171 billion €.

My fellow US citizens will be saying to themselves, "So what? We have to report our foreign bank accounts, and any large cash transactions are flagged." But gentle reader, this is much different. This is new law for Spain, basically currency control writ large, and bells have to be going off all over Europe.

This is the new Spanish government revealing serious desperation. The government's back is to the wall. They have to know they will not collect the taxes they need to generate, but are going to try anyway to demonstrate to the rest of Europe (read Germany) that they are doing everything they can.

In a side note, on Wednesday, Spain's interior minister introduced new measures to thwart plots using "urban guerrilla" warfare methods to incite protests. And the local papers are printing op-eds by economists talking about how the effort to comply with German austerity demands will just make the economy worse, and that the government is not taking into account the resolve of labor unions to oppose them. "Germany is the problem." It pains me to say this (truly it does), but this is what we were writing about Greece, not all that long ago. We are seeing footage of demonstrations, verging on riots. It is a familiar pattern.


TOPICS: Business/Economy; News/Current Events
KEYWORDS:

1 posted on 04/20/2012 10:52:38 AM PDT by dennisw
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To: dennisw
I thought Franco was dead.

/johnny

2 posted on 04/20/2012 10:55:53 AM PDT by JRandomFreeper (Gone Galt)
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To: dennisw
Anti fraud regulation? Sounds more like an effort to avoid flight of capital.Next they'll ban the purchase of gold and diamonds.Then they'll ban.....
3 posted on 04/20/2012 10:56:33 AM PDT by Gay State Conservative (Unlike Mrs Obama,I've Been Proud Of This Country My *Entire* Life!)
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To: dennisw

Why don’t they just get rid of currency? They could put a mark on everyone, and if citizens wanted to buy or sell stuff, they could just show the mark and then take what they need from the communal pile. [/s]


4 posted on 04/20/2012 10:58:13 AM PDT by ClearCase_guy (Like Emmett Till, Trayvon Martin has become simply a stick with which to beat Whites.)
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Comment #5 Removed by Moderator

To: Gay State Conservative
Sounds more like an effort to avoid flight of capital.

Yep. Or at least to avoid any further flight of capital.

6 posted on 04/20/2012 11:01:14 AM PDT by Billthedrill
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To: dennisw

THERE IS MORE AT REAL CLEAR POLITICS-——>>>>>>

LINK>>>>>>>> http://www.realclearpolitics.com/articles/2012/04/17/spain_too_big_to_fail_and_too_big_to_save_113870.html


7 posted on 04/20/2012 11:01:33 AM PDT by dennisw
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To: Tzar

http://www.realclearpolitics.com/articles/2012/04/17/spain_too_big_to_fail_and_too_big_to_save_113870.html

yea a step towards capital controls....coming soon to a country near you!


8 posted on 04/20/2012 11:03:11 AM PDT by dennisw
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Comment #9 Removed by Moderator

To: JRandomFreeper

Franco IS dead. That’s why they’re having problems.


10 posted on 04/20/2012 11:09:47 AM PDT by Little Ray (FOR the best Conservative in the Primary; AGAINST Obama in the General.)
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To: ClearCase_guy
Why don’t they just get rid of currency? They could put a mark on everyone, and if citizens wanted to buy or sell stuff, they could just show the mark and then take what they need from the communal pile. [/s]

they will.

11 posted on 04/20/2012 11:29:29 AM PDT by the invisib1e hand (void where prohibited.)
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To: Tzar
Refresh my macro knowledge. The impossible trinity is pegged exchange rates, open markets, and what else?

A university education in economics.

And the first two are optional.

12 posted on 04/20/2012 11:30:41 AM PDT by the invisib1e hand (void where prohibited.)
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To: dennisw
They have to know they will not collect the taxes they need to generate, but are going to try anyway to demonstrate to the rest of Europe (read Germany) that they are doing everything they can.

No worries there. They can book the "uncollectable" fines as receivables.

Boy is life about to get miserable for the hombre en la via.

13 posted on 04/20/2012 11:33:21 AM PDT by the invisib1e hand (void where prohibited.)
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To: dennisw

So what happens to a nation whose people have forgotten how to work, whose people has been taught entitlement since birth, when their all-knowing government can no longer borrow the money to support them?

Good case to watch -
‘cause we’ll be repeating it here in five years or so.


14 posted on 04/20/2012 11:44:49 AM PDT by LucianOfSamasota (Tanstaafl - its not just for breakfast anymore...)
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Comment #15 Removed by Moderator

To: Tzar
I’m sure you meant that to be meaningful.

I'm sure it was.

16 posted on 04/20/2012 2:30:45 PM PDT by the invisib1e hand (void where prohibited.)
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