Global Design And Business

The welfare state is based, according to its supporters, solidarity between generations, classes and regions. Thus, the privileged assumptions of a society help those who are less a transfer of income to be carried out with government assistance. The problem is that there is a limit beyond which this approach starts to get complicated. If no contributors may not have pensions, unemployment benefits or taxes sufficient to pay the entire scheme. It is possible that in Spain we are close to exceeding that limit.

According to the latest study Agettes (Association of Temporary Work Great), the support rate has been reduced in Spain from 2007 to 1.44 1.88 in the first quarter of 2011. This ratio measures the ratio between members and the unemployed and pensioners. That is, accounts for something like the number of contributors who support each recipient of a state subsidy. And in Spain, this number has been falling steadily for four years.

The fundamental cause is the decline in employment, on the one hand has thrown in the number of members of the Social Security and another has boosted the number of recipients of unemployment benefits. But the demographic trap in which it is Spain, with more and more elderly and fewer young people have contributed.

Having an empty house causes numerous expenses that increase exponentially if we have mortgaged the house. In the current situation, to have stopped (or rented or sold) a house of 90 m2 in Madrid with a mortgage can cost over 30,000 euros per year. Surprising? Let’s do the numbers:

Fixed expenses

Without going into any maintenance or repairs, owning a home has many fixed costs. Thus, for example the house of 90 m2 in Madrid can be concluded that to have: Property Tax or IBI (400 per year), community-owned (100 per month or 1,200 per year), home insurance (300 euros per year), minimum expenditure of light (20 240 euros per month or per year), minimum expenditure of gas (20 euros or 120 euros every two months a year).
In total, the approximate cost of this fixed cost would be about 2000-2400 per year.

Deterioration in the price

Almost any house that is currently in the market suffers a loss in value as the price declines are somewhat generalized. A house of 90 m2 in Madrid (half m2 Price: 3,642 euros) has an average price of 327,780 euros, according to the latest data report idealista.com prices

As the price of housing in Madrid fell 6.5% in the last 12 months, the house has “lost” value of EUR 22,786 in the last year

In total, adding the fixed costs and the deterioration of the price, any house without the use of these features would have cost the owner approximately 25,000 euros

Mortgage interest

In the unlikely event that the home was recently foreclosed, we would have an additional expense. At this point we will only enter as “cost” of housing interests, considering the principal and savings. Although last year there was minimal interest rates, also the owner have had to endure through interest cost. Specifically, for an open mortgage last year to 80% for a house of € 350,000 with an interest rate of 2%, interest paid in the last 12 months have been about 5,500 euros.

In total, be empty or sell a home of 90 m2 in Madrid may have come to cost the owner more than 30,000 euros in the last 12 months or 8.5% of the price a year ago.

It should be noted here that if the total interest rate mortgage for less than 5%, the interest cost would increase from € 5,500 to about 14,000 euros. with this data and keeping other variables fixed, the cost of having the empty house would be around 40,000 euros, more than 14% of the price.

What happens when a country leaves the euro? Part 1

What happens when a country leaves the euro? Part 2

Direct Impacts

1 .- Business

The number of bankruptcies will increase.

- Increased costs: the devaluation would lead to higher prices of imported products, with special emphasis on oil.

- Export: export companies they would be the only foreign exchange earnings. Could increase their sales.

- Domestic market: companies that live on the domestic market would experience great difficulty.

- Debts holders of euro-denominated debt would have more trouble paying them.

2 .- Banking

The bank could collapse.

- Creditors: banking lives on external funding to extend credit on the inside. The output of the euro would mean the end of easy access to external finance, so many creditors require faster depreciation and euro.

- Delinquency: the banks would increase their delinquency rates.

- Capital Flight: As you are viewing in Greece, is one who has savings to safeguard them in euros abroad. In the case of a departure from the euro this flight would intensify.

3 .- Families

Many families go into insolvency.

- Unemployment: the bankruptcy of companies would significantly increase unemployment.

- Income: families would be seriously diminished their real income because of the devaluation. They would also have to pay many of your debts in euros.

- Purchasing power: the power purchase would be greatly affected. Imported goods would be more expensive and could hardly summer off.

4 .- Government

The deficit would be even greater.

- Expenditures: the government would spend more on subsidies. If you want to avoid a burst of inflation the central bank would raise interest rates to finance the debt.

- Income: decrease dramatically. More unemployment means less tax revenue in all areas (income tax, Companies, …)” indirect

What happens when a country leaves the euro? Part 1

What happens when a country leaves the euro? Part 3

“Immediate effects:

1 .- Currency devaluation

The euro would disappear to make way for a new coin, a new penny or a new shield. The new coins would be born devalued against other currencies like the euro or the dollar, causing:

- Exports more competitive: abroad would take fewer euros (or dollars) to buy products. A similar effect would occur in tourism.

- Imports more expensive, imported products would be more expensive. Greece, Portugal or Spain imports virtually all oil and gas they consume, energy and transport price would skyrocket.

- Inflation: no necessarily have to be an inflationary scenario. Depend on interest rates that would set the central bank.

- Debt: pay off the debts would be more costly, as many would remain denominated in euros. Debtors would have to buy euros to repay their debts revalued.

2 .- Interest Rates

Interest rates would have to rise necessarily to prevent an inflationary spiral and to try to moderate the capital flight.

- Financing: banks severely restrict credit, since it would be more subject to external funding to redress the lack of domestic savings. With the money more expensive, less accessible and more risk in lending interest for families and businesses grow.

- Status: The government would have serious problems to finance the sovereign debt markets.

- Creditors: banks have to pay their debts in international markets in euros, this would cause demand, in turn, that their borrowers do likewise. It would, therefore, a very high risk of widespread default.

- Debtors: families and businesses would be faced with a really black picture. Receive their income in the new currency, but would have to pay their old debts in euros.”

Euro area lives in a debt difficult crossroads output. The insolvency of different countries, beginning with Greece is assuming a puzzle because the solution difficult to take, since it is known that it is impossible to return the aid, but not to keep giving money puts a halt to the European financial system, due to its high exposure to Greek debt as well as to other countries, the contagion effect that debt relief can suppose, since the bondholders and investors, would considerably increase their aversion to government bonds of other countries, also considering the significant amounts of debt issued to finance needed. The problem is to continue to give money just like that exacerbates the problem making it bigger in the future, winning only time.
So, if finally a country takes measures in return for aid, or he fails to pay the same, breaking, and thus abandoning the euro, what would happen in this country?

What happens when a country leaves the euro? Part 2

What happens when a country leaves the euro? Part 3

The Burj Al Arab is a luxury hotel with a height of 321 meters.
The hotel is listed as seven-star category, which goes beyond normal classification of hotels from one to six, due to its truly outstanding features that distinguish it from any other hotel in the world. The Burj Al Arab does not have regular rooms but has 202 double suites. The smallest of these suites occupy an area of ​​169 m², while the largest covers an area of ​​780 m². The Royal Suite costs $ 28,000 at night. [Citation needed] It also has a car service from Rolls-Royce luxury available to every guest.

The Burj Al Arab has nine restaurants, among them the Al Mahara (located under the sea, offering an underwater view through a stained glass window in the form of tank) and Al Muntaha, located 200 meters high, allowing a view view of the city of Dubai.

How much would that cost the floors depending on our salary? This article shows how wages are paid in each Autonomous Community, which has housing prices in each of them, and how much it should cost and how much it exceeds that price:

“The salary of an individual is a determining factor when purchasing a home. Thus, experts recommend that the maximum price of an apartment does not exceed 2.5 to 3 times the annual gross income of a person. In Spain is impossible that this paradigm is met. In 9 of the 17 Autonomous Communities, the prices of flats are more than 200% above the norm. Catalonia and Madrid takes the cake with increases of 408% and 335%, respectively.

According to the wage structure survey published last Wednesday by the National Statistics Institute (INE), the average salary in Spain was 22,511 euros in 2009. In the event that an average Spanish wanted to buy a flat, he should not pay for more than three times their gross income, ie the price of your future home should be around 67,500 euros.

However for this half Spanish, call it Juan Haldudo, find an apartment at that price would be an arduous task. That same year, the nominal average price of housing in the country reached 255,800 euros, according to figures Evaluation Society.

That is, Haldudo would pay 278% more, a bonus of 188,000 euros, of what the experts advise to buy a house (always referring to general statistics, since the prices of apartments may vary depending on the size, location, etc.).. Or what is the same, to pay for that floor should be allocated so Haldudo inclusion of almost 11.4 times the salary of a year.

The Haldudo disappointment or indignation would grow to see that move to another region not solve your problem with housing. All CC AA, the prices of the apartments are well above the parameter of three times gross income to buy a home. In 9 of 17, the value of the house is over 200% above that standard.

In the Basque Country, the community with the highest average salary in 2009 with 26,162 euros, it would take about 11.7 times the amount of land to buy a house because the average price of homes in this community was around 307,700 euros this year .

The least gross income would be devoted to buying a home is in the Region of Murcia. Here, the average salary was 20,430 euros compared to the average cost of 148,000 euros from the housing. It follows in this order Extremadura, Asturias and Galicia with levels below 200%. Catalonia and Madrid this ratio soars to record 408% and 335%, respectively.

Director of Research at the Institute of Economic Studies (IEE), Gregorio Izquierdo, believes that another reference that links wages and home values ​​is the financial strain. “To know if the prices of homes are expensive or cheap used many indicators, but experience shows that financial stress is linked to the most significant,” he stresses.

This parameter reflects changes in interest rates, household income, the price of housing and within the given mortgage loans. A result above 40% indicate that prices are high, while below 30% are cheap.

In 2009 when there was still the residence deduction, the deductions excluded financial effort was 34.6%, compared to 28% of those who did include the deduction.

About what is happening in mobile operators:

Telstra’s CEO, said that “the price war has just begun.’re Going to lose another 30%.” And the top three Spanish mobile operators, Movistar, Vodafone and Orange, just off a price war to halt the loss of customers from Telstra and MVNOs.

A new example of the virtues of free markets and privatization and competition it creates. If Telefónica had not privatized at the time, it would remain a state monopoly, without competition from any other company (as well ocurriía), and therefore much more expensive with prices as it was. The privatization and market liberalization led to the entry of competitors and thus lowering prices continuing to win customers, and increased investment to improve services and products to offer (they earn more return on investment) and the client also with new and better products). This is market competition incentives to companies to improve (and prices) in order to gain market share, and it is costing us not through taxes as the vast majority of public companies.