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Southern Europe: Beyond the Faultline

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I have been saying that the buying rush by the Brits in southern Europe was mistaken, and they will be buying into falling markets, but no-one listens to me. The fact that I have been doing this for so long and have never yet been proved wrong seems to cut no ice. So be it. But now we have the first signs of what I have long suspected, the destruction of the tourist costas in Spain.

I can't remember when I started saying that buying in Spain was a really bad idea, but I think it was in 2009. I started off by showing photographs of a town right on the Spanish/Portuguese border, just to the north of Ayamonte. I estimated that it was the size of Welwyn Garden City and had a population of maybe a dozen people. That's people in residence.

A couple of years ago I briefly lived there. It was certainly busier than ten years earlier, but it was far from full.

I did reconnoitre the whole area back in 2009 and found tourist town after tourist town with masses of empty apartments and villas right the way from Isla Cristina round to Almeria. And I advised folks thinking of moving to Spain to think again. It seemed to me that it would take a decade or more to cope with clearing the backlog of homes for sale created by some serious over-building.

Things were just starting to pull back when the government quite deliberately trashed the economy. In my opinion it was a deliberate and malicious thing to do, and I find it hard to deny those who say this is all part of a plan the wreck the world, and then take over. I have to say I still think it is just an example of how stupid the average politician is. Sometimes I wonder if any of them ever went to school. And at the top of the tree we have Batty Biden. All I can say is that I am glad I am not a citizen of the USA, because they have become the laughing stock of the planet. The activities of Biden are beyond belief, and nobody seems to want to do anything about it.

Maybe the doom-mongers are correct. It is clear to anyone that Batty Biden should be in a home for the terminally bewildered. But it is obviously to someone's advantage that the number one country on the planet has a top-cat who is quite clearly in the later stages of alzheimers.

As a president he has some serious competition for idiocy, but he clearly tops the lot. Let me refer you to one of my cat cartoons. Here's the url. It might amuse you.

So, what do you do?

If you are living in Spain, it is now much too late to do a runner. Same in Italy. You guys are now well and truly in the soup, and it can only get worse. The resolve of countries in the North of the continent is getting stronger by the week that they have no intention of writing blank cheques for those in the south. Even if the Scandinavians hang on in there, and the Netherlands dithers for another decade I dont think that will alter the fundamental fault line that runs across Europe.

The second issue is that politics is clearly failing, and the voice of business is starting to get louder. I am surprised it has taken so long for this to happen. My argument used to be that there will undoubtedly be a Brexit deal because various business interests will twist a few political arms. That should have happened two years ago, but is only just beginning to happen now. The business angle will get stronger as the political and economic chaos spreads. The first signs are now emerging in Germany. How long it takes to get to a serious groundswell is a matter for guesswork, and I dont do guessing. But one does have to ask how long is Germany going to backstop Southern Europe's economic collapse?

Spain's economy rests on three legs: Catalonia, the Basque country, and the southern Costas. At the moment Catalonia, the Basques, and Galicia will quite happily put two fingers up to Madrid. The strength of the tourist areas depends upon the hospitality sector, plus in large part the Brits. Government decrees have put the hospitality business out of business, and now they are making sure the Brits get out as well. If this continues much longer Spain will start to sink back into the middle ages.

I used to call Spain my home, and have lived there for a great many years. I also know my Spanish history, and I have always had a very poor view of their Catholic Majesties, who threw out the Moors, then threw out the Jews, and instigated a top-down society that languished for half a millennium. When I first walked the length and breadth of Spain, and indeed, spent half a year as the focal point in a small village in Northern Spain where the only other person who could read and write was the village priest, the country might have been stuck in the year 1450 for all they could show for the passing of the centuries.

If you want to catch up on my story of those times, do read my book:

I mention those times because throwing out the life-blood of the nation by their Catholic Majesties, and instituting a religious and social lockdown, and destroying the middle class, was what wrecked Spain. That is happening again before our eyes as the government follows a route that leads straight to disaster. How long the lunacy lasts, and what comes next is beyond my ability to guess, but you will note that I no longer live in the country which once became my spiritual home.

Spain is in very real danger of returning to a series of states. Madrid has lost the plot, and is in danger of losing parts of the country.

And do remember that Spain is not the only country south of that fault line. Italy is, in many respects, two countries which straddle that fault line. Get on the wrong side and you are going to face tough times ahead.

Former Yugoslavia straddles that fault line but I am unsure where to put the countries that used to form that post second world war amalgamation. My gut feeling is that there is still an undercurrent of instability in that region, which is lovely in parts, but economically still a bit of a mess, and not the place a sensible person would sink a significant amount of money.

Greece is squarely south, and squarely a wrecked economy.

But I have for some time suggested that buying anything in the EU or Southern Europe is premature. There is still a long way to fall.

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