Most importantly, we have our health (touch wood) and each other.
By Nick Corbishley, for WOLF STREET:
The whole of Spain, like the whole of Italy, and the whole of France, is closed for business (and just about everything else) as the government tries to bring Covid-19 under some semblance of control and keep the virus from overwhelming the healthcare system. The number of cases of the virus in Spain has reached 11,000, having shot up by over 2,000 in the past 24-hour phase (though these figures reportedly have a three or four-day lag). There has been a total of 491 fatalities.
We are now on day 3 of the lockdown and for the next eleven days (and probably some time after that), almost every type of commercial and public venue, including bars and restaurants, schools and universities, has been forced to shut and millions of people — myself and my family included — are being forced to live in curfew-like conditions that were barely imaginable just a month ago.
Freedom of movement has been put on hold, as have a host of other basic so-called “freedoms”, such as the freedom to gather. Unless you’re a police officer or municipal worker, you can only be outside if you are on your own. And even if you’re on your own, if you are found on the street without good reason, you can be fined. If you are a repeat offender, you could even face a jail sentence. In the eyes of the law, there are only nine justifiable reasons for venturing out:
- To travel to or from work, assuming, of course, that your workplace is still open. Most of the businesses that are still open are those that do not have to deal with the public. Factories and offices are still allowed to stay open as long as they have certain health and safety regulations in place.
- To take out the rubbish.
- To buy food and other essential goods from the local supermarket or grocery store. Tobacconists, newspaper kiosks and electronic stores are also allowed to open.
- To buy medical supplies from the local pharmacy.
- To go to the local health center or hospital, but only in the case of emergency or serious chronic conditions.
- To visit relatives in need.
- To take the dog out for a walk.
- To go to the bank. Most bank branches are still open though a lot of back-office staff are now working from home.
- To get your hair cut.
No, seriously. Among the reasons accepted for being on the streets of Spain without receiving a three- or four-figure fine from one of the many patrolling police officers is going to a hairdresser. Apparently, this is to “help” people with mobility disabilities and the elderly.
As for the hairdressers themselves, most are understandably petrified of catching the virus from one of their customers and would much prefer to be at home with their families. Industry groups have even lobbied the government to reverse the ruling.
Most salaries workers are already safely ensconced at home where they’re supposed to be working remotely, though how many of them actually have meaningful work to do, apart from just answering the occasional email, is anyone’s guess. After all, many of the companies they work for have completely stopped producing products or providing services for at least the next two weeks and quite possibly longer.
For the time being, these workers will continually to receive their monthly salary, but that may not last long. The government has already made it easier for businesses to temporarily lay off workers, who are then able to claim unemployment benefits. This is preferable to losing their jobs for good.
For many companies, especially the small ones that form the backbone of the economy, accounting for around 70% of all jobs and over 50% of GDP, a whole month (or more) of closure, with revenues running dry, unpaid invoices piling up and costs continuing to rise, could be fatal. Such is the case for the small handmade jewelry store my wife, a jewelry designer, works for in the Born neighborhood of Barcelona.
For most self-employed and gig economy workers, the pain has been more or less instantaneous. As a freelance writer, translator and teacher, I speak from direct experience. Even before this crisis hit, things were not easy. One of my biggest clients of the last ten years — a prominent Spanish business school, for whose research magazine I ghostwrite and translate articles — suddenly stopped sending me work three months ago, due to internal issues. This has had a major impact on my earnings and cash flow.
I have tried to make up for that by finding new customers for the English finance courses I run but right now, with the virus spreading, markets collapsing, economies plunging into recession and my target market, management funds, struggling with redemptions, no one — and I mean no one — is interested in spending more money on training for employees whose future at the company is no longer certain.
One of my long-term customers, a Barcelona-based asset management fund, has already suspended classes until further notice. Others are, for now, prepared to continue doing the classes remotely. As for the business school, I received news on Thursday that it had cancelled all programs and events for the next two months and that all employees are to work from home til further notice. For at least the next two months there would be no further commissions of any work for freelancers like me.
The business school is extremely well connected, well informed and well funded. The fact that it felt it necessary to cancel virtually all of its money-generating activities for the next two months suggests that this lock down is likely to extend well beyond the initial two-week period established by Spain’s government. But how many businesses can survive that long?
To give SME’s a little extra breathing room, Spain’s government, like Italy’s before it, has launched tax-relief measures that will allow businesses with sales below €6 million to delay paying up to €30,000 worth of taxes by up to six months. The government is also considering exempting the self-employed from paying the monthly social security contributions (minimum amount: €290) for the duration of the crisis.
As in Italy, debt repayments may also end up being postponed for businesses, but only if the state serves as ultimate guarantor for those debts, said the Bank of Spain. Otherwise, banks will not lend money or extend maturities to any companies (apart from the biggest debtors, of course). If that happens, the central bank warned, a credit crunch or crisis could ensue as delinquencies skyrocket and financial stability crumbles.
In other words, the banks are unable or unwilling (or both) to lend a helping hand in this crisis unless the government underwrites the debt, as it has been underwriting so much banking debt since the last crisis. The problem is that the government itself is not exactly rolling in money. Its public debt to GDP ratio, while not nearly as bad as Italy’s (135%), is still high, at 95.5%.
But that hasn’t stopped it from unveiling plans to mobilize a whopping €200 billion — the equivalent of around 20% of GDP — to address the virus crisis.
If the plan is signed off by the European Commission, much of that money will be used to save perfectly viable companies from a wholly unavoidable external crisis. But no doubt some of it will also be used to bail out hordes of heavily indebted zombie companies that should have hit the wall yonks ago, and would have done if it weren’t for the ECB’s monetary largesse.
Pressure is also mounting on the government to suspend mortgage payments, rents and utility bills for the next month, as has already happened in France. To prevent the virus crisis from “triggering a new housing crisis”, the government needs to implement broad social and economic measures, said a joint statement by the country’s two largest tenants unions, whose membership has soared in recent days
Even before this crisis hit, many tenants in cities like Barcelona, Madrid, Palma de Mallorca and Malaga were already struggling to pay their astronomical rents. Even if landlords demand full payment this month, in many cases they won’t get it. Then, what will they do? Throw out the tenants, knowing full well that the same thing is happening in buildings across the city? Who will they rent out the newly vacated apartments to? Tourists? Ha!
Finally, this crisis can also hit in another more subtle way, as my Mexican mother-in-law has learned. And that is through currency depreciation. A month and a half ago, she sold her apartment in Mexico City with a view to using the money to live in a rented apartment in Barcelona, where her only daughter lives. But since she had no bank account in Spain she could not transfer the funds (in pesos) straight away and had to wait until she got here. By the time she arrived the already weak peso had lost roughly 20% of its value against the euro.
Now, my mother-in-law is on lock down in her daughter and son-in-law’s apartment. In euro-terms, she’s 20% poorer than she was a month ago. For the moment, the three of us are living in relative harmony. We do not want for anything, apart from job security and the occasional evening stroll together. We have enough food (having stocked up in the preceding weeks), some toilet paper (but not too much), lots of books to read (and reread), films to watch (and re-watch), card games to learn, friends to speak to, the Mediterranean sun shining on the balcony and through the windows, and even the sound of birdsong, a weird but welcome element of our new reality. Most importantly, we have our health (touch wood) and each other. By Nick Corbishley, for WOLF STREET.
Local governments end up buying dying malls to keep them from becoming dead zones. Read… Mall Giant Intu Warns of Bankruptcy: First, the Meltdown of Brick & Mortar Retail, Now COVID-19
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De-Valuation of Currency – Get Ready – Grab Your ankles….3…2….1
What????
You need velocity for currency to get devaluated. Renters like myself have been killing velocity for a while now. And we aren’t going to stop killing velocity once we finally buy a home which price isn’t artificially inflated (say a REO).
I’m also patiently waiting for a 90% discount on a great property At least in terms of ozs of Au
This report is wonderful IMO, if for no other reason than to confirm that the oligarchy in Spain is continuing to do their best there overtly, as opposed to the oligarchy in USA that continues to do their best to screw we the people, and maintain their hegemony, covertly, to contain and demean the working folks of Spain and USA as they have done so far so successfully in the last few decades in both areas
Right now the best thing our oligarch owners should do IMO is to ”forgive” all housing payments, for the duration of this crisis, if for no other reason than to confirm they are ”on board and trying to help.” After that, the 1$K gift is a good start, but only that…
As others on this site, if not on this thread have said,,, time and enough to at least try to get back to basics, without any of the esoterica of recent times in the so called, “Financial Economy.”
I love the part where if you’re a land owner renting out your shitty little house you’re an oligarch.
Maybe he means Blackstone.
Vulture Capitalist,much like the holders of Puerto Rican debt.
Lower the rent?
It’s a business calculation. 80% of something is better than 0% of nothing.
Unless, of course, there is free government bailout cheap/easy money to be had…
“Even if landlords demand full payment this month, in many cases they won’t get it. Then, what will they do?”
First month is not the issue. It is 6 months later and you’re still a month behind that the problems start
Australia is in chaos .. unfortunately .. all due to media hype & scaremongering.
Food supply .. the day to day shopping is totally out of control .. even today the main supermarkets have not managed to install a system of normal shopping only .. panic buying is the norm .. with main stream media beating up the frenzied fears of pending doom.
It looks like Prime Minister Scott Morrison does not have the leadership skills to maintain order & sanity in our beloved nation when push comes to shove.
He will be Liberal Party Prime Minister No3: .. after Tony Abbott & Malcolm Turnbull to be asked to stand down & not a moment too soon for my liking.
The elderly & disabled have been allocated 1 hour shopping from 7.00AM – 8.00AM every morning .. only that it is dark & freezing cold in Victoria at that time & of course many persons with disabilities cannot go shopping in the first place .. I am almost blind & suffer a serious heart condition & am house bound .. online shopping kept me in provisions & now that service does not exist ..
WHY NOT ??
The supplies are trucked in every day as usual ..
Shopping hours have been cut by 4 hours so that the stores can restock the shelves .. why ?? .. they have from 12.00Am to 6.00AM to restock the shelves.
Isn’t it now the case .. as a result of mismanagement .. that Australia’s supermarkets & stores are now in financial danger of bankruptcy as a result ??
Our nation is falling to pieces .. due to a total lack of leadership across the board.
Way to go Prime Minister Scott Morrison.
Total BS post.
Australia is doing fine compared to other countries.
Melbourne was 19C (68 F) this morning with some sun and clouds.
Supermarkets are pulling in huge amounts of money from the panic buying which has been caused by the idiot ‘herd’ mentality.
Metcash which runs the IGA brand of supermarkets was the biggest gainer on the ASX yesterday up by 26%. Woolworths was up by 9%. Bankrupt? They are rolling in the money.
The elderly were allocated an extra hour of shopping ahead of others and can go shopping at any time of the day as usual.
The ONLY problem in Australia is that idiots are throwing out common sense such as that dummy in Tasmania that tested positive for the virus and then went shopping on the way home.
Why did it go up so much? or did metcash lose a third of its value the day before?
\\\
In times of old, people believed that wood could harbor spirits, as it was once a living being. Hence by knocking, one would scare them, they would flee and not be able to do harm. We do it too. Be healthy and stay safe.
\\\
The deathwatch beetle knocks from inside the wood.
https://en.wiktionary.org/wiki/deathwatch_beetle
Actually, the real reason is because most sailors didn’t know how to swim, so being near any piece of wood that was not bolted to the ship would most likely save their life in case the ship sunk. In fact the “Knock wood” thing was made popular by sailors that were really into those kinds of
superstitions. But most of those believed by sailors had at least some grounding in reality.
Recent trivia re: sailor superstitions. From Trawler by O’Hanlon
Boat fishes out of Scotland.
Never leave on Friday. (This is common everywhere, incl Alaska crab fishery)
Never turn a hatch cover upside down.
Never bring a green suitcase aboard.
Discourage machine washing (at home) day of leaving.
Same with knitting lest the nets be tangled.
And NEVER let a woman aboard or even see you off.
I don’t subscribe to any of it folks I’m just sayin
I hope they don’t think they are going to keep me locked up? Europeans are rather compliant. I am not sure all the communities here in America are complying. From what I have scene on the news, people are enjoying their St. Paddy’s day festivities. I don’t drink, but I am glad they are out enjoying themselves. We are going to be just fine and I know for a fact that I will not get the corona virus and I will be just fine! I am not buying into their fear porn.
Lockdowns are happening, and many Americans are hiding in their closets in fear of the boogey man corona virus.
Stephen and Keith, what ignorant comments you two make! I hope you are lucky enough to stay as healthy as you think you will.
Uninformed complacency
Get it deep into your lungs and then comment.
Wow – you guys are just amazing.
I hope no one takes you guys seriously.
Whistling past the graveyard mate.
You may not get sick, but when this collapses you will starve.
No, I don’t think they are going to do that in USA.
As an old timer who listened very carefully in my youth to the old guys in my ”hood” some of whom vets of the war between the states, but mostly vets of both the World Wars, 1 and 2, and Korea;,,,
in USA, so far, it has been and I hope will be the efforts of all of We the People in each and every case of We being challenged, and that again IMHO, is exactly what has made USA, according to some, ”The Shining Light” of the current world.
Another old Vet here agrees wholeheartedly.
Made a trip last weekend from Dallas area to Houston area with stop at the only Buccees travel center in Madisonville, TX. It was wall-to-wall people with no masks in sight. Did our biological business and out the door we went. Didn’t stop on trip back.
We’re talking about the French who riot every Sunday.
The southern part of my country celebrates carnival. It has the big corona explosion.
I’m sure the elite would love to freeze mortgages to keep the housing bubble inflated where it’s at. Let’s keep a whole generation priced out of homes shall we?
What????? Number II
> Let’s keep a whole generation priced out of homes shall we?
Exactly. Until I don’t get an almost free REO to live in and stop wasting $ on rent, I’m not spending a cent on the US economy aside from food.
Housing in many areas is totally out of control but I wonder if freezing mortgage payments or rents is the proper way to deal with that issue
‘Officer, you find me, a Poet, here in the street because I wished to look at the stars, and dream of being far, far -very very far – away…..’
Sorry to hear about your difficulties, esteemed Don Q as was.
Lock-down is one thing, but with the mother-in-law…..
About a month ago, I warned my cousin that he might like to get stocked up with supplies for the family swimming pool business in Catalonia, as there might be supply-chain problems.
They still have business, but already supplies are interrupted, so they pretty much have to shut up shop and probably won’t be building any pools this summer.
At a higher level, all that emergency finding is going to end up in some interesting pockets.
Best of luck to you!
Xabier (formerly known as ‘Albizu’).
Thanks Xabier (FKA Albizu). It’s great to hear from you.
Tbh, my mother-in-law is not your typical mother-in-law. Despite her age (which I am forbidden to divulge, on pain of death), she’s modern, open-minded, free-spirited, pretty easy going (most of the time) and keeps to herself (again, most of the time). No doubt, there’s going to be a few dramas along the way but most of them will be between the two ladies. I’ll be trying to keep the peace.
Keep safe!
Nick
That is how it worked out for me too when my mother-in-law had a two year stay. My mother-in-law got along swell with me but her daughter was another story.
TXR, that is my experience as well. MIL moved in after FIL passed on. She and I got on famously. She and her daughter…not so much. FIL had left her well, so she bought her own home and moved out.
Like Renoir: he married a good cook from Burgundy, whose mother was similarly skilled – when she came to stay, permanently it was Paradise, Renoir being far away from the kitchen
I could certainly bear isolation under such conditions….
Agur eta un abrazo fuerte!
Close, but still not enough IMHO:::
IF Spain, et al, really and truly want to ”stop this virus in its tracks” WE the People will have to do a ”total” lock down for at least two wks, indicating this virus has the, up to now ((( 37days ))) so far unique ability to transmit from carrier humans for up to many many more days than any previous virus, including common flu and cold, without those carriers showing any symptoms to any tests, so far. Repeat, ANY,,,
I, as one of the elders, who has been gainfully employed as an analyst for the last several decades,, , though not yet ”elderly ” as per my 94 this year dad in law, a hero of WW2 AND Korea, who rely on what today is called, ”herd immunity” because I have none, would really be willing to help analyse and make suggestions, and do so here volunteer to do so, from home for now,,, if any such challenges come in front of me, as I can only suggest to this wonderful site, full of obviously well informed and well connected people.
Wolf, IMHO, especially because of your clear skills as moderator, this is the time to do your best to set up and moderate a site devoted to doing our best as a species to: 1. Expand the consciousness of all sentient species, but, in this case, clearly trying our best to help expand that consciousness of all humans first, but only because we appear to be doing the most long term damage.
2. After that, continuing your very open forum, continue to ask all your very wonderful commenters here, including, esp today, Unamuser, so far the ultimate contraian, etc… to do their best to continue to do their best, in comments, as well as at some point in time not yet clear, manually and now digitally increasing the ”eyes on” analyses that will lead us as a species forward.
And, at this point, having spent the last two or three decades doing my best after thorough teaching from local Great Spirit representatives in SF and SC area, I can only hope and pray that our species can overcome all of the divisive strategies and do what needs to be done to help Gaia thrive and prosper before she does us under and tries again with some other species.
If you are with me in my hopes, please pass this along to all the very good folks on this site; otherwise, as always when i am catching up with my wine futures, delete, and become one more puppet of the oligarchy..
WARNING: not DELEting may make you subject to same as RossPerot!
‘Interesting’ screed’. Ill have what you’re smoking, vintage. Yikes…
Long time reader of Wolfstreet here, but this is my first reply ever. So there’s a first for everything :-). I live in Belgium and a lockdown just like in Spain was just announced, like one hour ago. It will start tomorrow at noon and last till the 5th of April.
Kurt,
Good luck to you all. We used to live in Brussels (Ixelles, facing the ponds). Loved it. This type of lockdown is now spreading around the world. I just hope it doesn’t last too long.
This is just martial law/police state through the back door. Spain´s tourist industry this year is absolutely finished. The effects of this could be absolutely terrifying. It feels like Spain is boardering on economic collapse, in the name of a few OAP´s that are dying in OAP holmes.
Here in Portland we have had a large influx of millennials over the past 6 or 7 years. Most of them did not move here for high paid jobs in the tech sector (like the bay area) but because it was the cool place to be. As a result most of them work in service industry jobs or things like graphic design, or digital marketing. They live stuffed in to the overpriced new apartment complexes that line the “happening ” streets. Many of them pay in excess of 50% of their pay in rent and have little or no savings. With the service and gig economy now collapsing due to covid-19 a great portion of these new arrivals find themselves unemployed. Unless they receive nearly free rent for the next few months ( not likely) they will have no choice but to pack up their cars and head back to live with their parents in the states they came from. So I expect a large exodus from places like Portland back to the flyover states, except it will probably be in Subaru’s with luggage tied to the roof and not U-haul trucks as there will be no funds left for such luxuries.
It sounds like a copy of Denver people! Households in Colorado are in debt till their eyeballs, mostly due to mortgages due to completely overpriced homes that also tend to be old and need a ton of maintenance.
All the best to you and family Nick.
Funny how the sound of birds singing can mean so much given the circumstances, eh?
My moments of zen are when a bald eagle is soaring above me while bicycling along the river or lakes. Two were circling above the Minnesota River as I rode my new motorbike home from the dealership this afternoon.
Minnesota & the Twin Cities are closing down, but not going on lockdown … yet.
Be safe and be smart people.
Thanks, Dan. You too!
Best of luck. I’ve been watching this thing daily since January. Looks like the Spanish people didnt take this thing seriously for a considerable period of time.
Are the outbreak clusters more regional or evenly distributed? Does spain have any wierd positive groupings like the Dutch with a high under 50 population who needed ICU level treatment?
Ezy P!
Just wrote a long reply but page refreshed For some reason and I lost it!
Peace and love to you and the Mrs (and her mum!)
Stu x
Thanks, Stu. Love to you and yours, too.
Just goes to show what a “house of cards” the global economy really is…
1) That’s it : the depression must be here : 4% are bullish.
On March 2009, 3%.
2) SPX closed above the monthly cloud, but the month isn’t over yet.
3) If investors will start to believe that the peak is near, few weeks, or months from now, they will invest in the stock market to get everything on sale, with great dividends.
4) They will get out of gold and bonds and carefully will buy stocks.
5) That will be a major change of character.
6) Nobody know when rd #2 will start, if ever…
7) In 1776 Philadelphia was hit every summer months by yellow fever.
8) The rich got out of town.
9) The poor stayed and died.
10) When retail stores are closed, landlords should rollback rent.
4% bullish would indicate a turnaround coming, in a normal world. Wasn’t it 96% bullish before all this business began?
Anyway, before the panic began, Toronto proposed that (overtaxed) storefronts that were vacant be fined for being vacant. Presumably the hope was that that would force them to be rented in spite of the nose-bleeding rents that it was necessary to charge due to property price inflation.
Best of luck Nick, and to all who read this blog
On the bright side, hopefully it’s a good thing the DC bubble-ettes and bubble-dudes suddenly seem to get that fiscal stimulus is necessary on the economic front.
Personally, I make that $1,000 check $5,000 if that’s all they can think of, yet better would be a much better social safety net from top to bottom…which they are not capable of thinking of, unfortunately.
With the Fed pressing the gas peddle down as hard as it can on QE and such, It’s hard to see how assets can’t explode higher at some point.
Unless those tools in it’s toolbox just stop working.
Trying to get wiser on the virus and its lethality (=not mortality) only to find there is little or no reliable info available. Reason for my curiosity is the fact that over here in Holland as of today 43 people have died, registered infected.
Closer look teaches that all of them were either hart-, lung-, cancer-, diabetes patients prior to be infected and/or 80yrs+ .
What exactly do we now about the danger of Corona that justifies the present draconian measures?
Death rates vs infected.
Contagious while asymptomatic.
Long gestation period.
100,000 ICU beds in the USA. 80% full now without the crush.
Death panel rationing for guys my age and older.
Where are you getting these numbers, KMOUT?
I sympathize with your question if only because I work for a healthcare company and was trying to internet similar questions because it’s affecting my work and was wondering how long that might continue. The raw numbers on infected vs death are not unusually scary IMO but maybe containment has blunt that and also with our Third World US healthcare system unable to do much testing that too be make figured look better than they really are. Yet the economic response is clearly going to damage the economy. I need to look again tomorrow for more information.
Maybe One in Five will be getting complications that require a hospital in combination with the fact that on any given day, five nurses / doctors off sick and a smash up on the motorway causes an immediate Health Crisis.
Sweden, being oblivious to the true state of their health care system, will be like Italy in 2-3 weeks!
This link give lots of figures updated daily.
I’d still like to know more regarding the deaths as in age/health ect.
https://www.worldometers.info/coronavirus/coronavirus-cases/
We are in the media alarmist political grandstanding phase of the epidemic. The whole thing stinks. As many are suggesting, the event is politicized as a smokescreen for the financial event that was happening anyway.
Which reminds me of a humorous episode documented in a book entitled “How Real is Real” of many years ago; it happened in Seattle. Someone noticed pit marks in the windshield of their car and became alarmed. It hit the news and suddenly everyone was noticing the marks, especially in certain light. What was it? Acid rain? Fallout from Russian nuclear tests? Something else? Panic ensued. At the Governor’s request, President Eisenhower sent a team of specialists to investigate. The short end of the story is that pretty well every windshield had these wear marks when viewed from the outside and not the inside, and the panic quickly died out. The problem was windshield viewing not windshield pitting.
And coronavirus is present in infections every year; rather than relating deaths to the whole population, deaths are compared to a sample group represented by people showing symptoms or already seriously ill, and among the aged with other maladies who are especially vulnerable. In China, there are 6000 or so deaths from a population of 1.5 Billion people. Yes, they took serious action, but the virus was already active and spreading by the time action was taken.
Eric,
You got this wrong. This is a serious threat, and it’s a new threat, and it kills people, and it comes on top of all the other things that kill people. No one really knows what this virus will do if left to run rampant.
But if it sends a lot of people all at once to the ICUs, and totally overloads them, the death rates will soar and people will be left to suffocate at home because there are not enough ventilators to go around.
That’s the problem — how do you slow down the spread of the virus so that not everyone goes to the ICU at the same time?
You need to get informed and start thinking instead of making up and spreading dangerous theories.
I disagree with Wolf.
There are no stats available that give proof of the danger of Corona.
The danger is exagerated as a result of selective testing: only people with severe symptoms are tested. Unknown is the percentage of the population they represent. So there you have it, the message is 1 out of 5 TESTED PATIENTS develop serious symptoms and has to be hospitalized.
South Korea is the only country that has applied socalled ‘carpettesting’. You test ad random in suspected areas. As a result their stats are far more reliable. They come up with 7 out of 1000 serious cases. And they have succeeded in flattening the curve!
From the homefront (Netherlands): as of today, 53 corona related death. All of them >69yr and WITH underlying medical conditions.
Lethal means mortal
@Nick, Are rents in Madrid really astronomical? I was under the impression that it was one of the few remaining affordable capitals in Europe, at least for buyers.
It used to be until the the start of the housing boom started that ended in 2008. After that there were a few years of stability and then an even great increase in rents than during that boom. Somewhere around 70-80% of Spaniards own their own home so the rental sector is relatively small. Rents are now astronomical in part due to airbnb, which has a disproportionately large influence because Spain has a very large tourism industry.
But that 70 -80% is not evenly divided over the country and ages. In the more expensive and younger parts it is much lower
Nick,
Your attitude is inspiring. Thank you for sharing it and may your good fortune return. Best of luck from the Sayward Valley. Obviously, stay safe and in good health.
Paul S
Steve Bannon’s Raheem Kassan’s War Room, Pandemic podcast has been a treasure trove of information. Some of the best from all fields without any tin foil.
Started listening in early January while recovering from surgery. They were onto China very early.
By late January I went to all cash due to the information provided in the podcast.
Every now and then you get a slow pitch right down the pipe where you can see the seams.
Arghhh. Just read this and it’s now 18 MONTHS IN LOCKDOWN before this thing possibly is killed off!!!!
How can we remain in lockdown for a year and a half????
NY Times:
https://www.nytimes.com/2020/03/16/us/coronavirus-fatality-rate-white-house.html
18 months? I am 100% sure that as soon as the reality of the economic disaster that is unfolding will hit home we’ll see things change. That’s what happened in China: wait for new cases to peak, then proclaim victory and cautiously but quickly start lifting restrictions. Yes, a lot of people will get sick and die without the media saying anything. It is cynical but the alternative is even worse: our leadership will have to re-learn to make painful decisions, the kind we have to make every day in the real world. Printing money won’t save them this time.
Governments can promise all the stimulus in the universe but what good is it if I cannot go out and spend it? What can I buy with my stimulus money right now? Overpriced face masks from a hoarder I have to meet in a dark alley? Even the Amazon delivery service is breaking down here, and that’s despite delivery drivers having been exempted from any restriction from day one.
I have never as much as touched a drop of alcohol in my life but this stuff is really tempting me to get a seriously heavy drink.
So right out of the gate… $60B for Boing Boing and $50b for airlines. Thats $110B. and $250B for 325,000,000 peeps. Par for the course, but there is still another $640B of temporary stimulus (initially).
Nick:
Today was an interesting day for my family of four.
Yesterday, my 19 year old daughter, just back from her closed downtown Toronto university, developed a fever that continues tonight. She shows all the symptoms of the coronavirus. So far mild, but this is only day 2.
My 23 year old son, stayed home from work, calling in sick, just to be on the safe side, especially since the government is saying everyone should stay home. The same for GE! He wanted to do the right thing.
At supper, my son wanted to know what he should do? He only gets 3 sick days per year. If he stays home for 14 days, GE will test him, and if he doesn’t have the coronavirus, he won’t get paid! Neither will the government!
We also discussed how Ontario is no longer testing anybody. The number tested in the last 3 days in Ontario has dropped, 43, 32, and yesterday only 13! Out of what 13 million people!
The Ontario assessment centers are telling everyone don’t even visit us! We don’t want to see you (unless you are near death)! We will not test you (because they have no test kits)! Just stay at home and self isolate!
Ontario has lost the virus containment battle big time!
If you have the virus, they don’t want to know about it! I tried to report! They will not test you even if you have the virus! They are simply no longer counting cases! Stalin is on the job!
So any virus numbers you see for Ontario, or Canada for that matter, are now completely 100% fake, just like China! BC might be doing a better job but I have my doubts. More likely just lying less!
We know of at least 3 people with the virus! Community spread is here!
So tomorrow my son is going back to work fixing wind turbines! He has no good choices! Unlike most young people, he has a modest rainy day fund.
My daughter works at a golf course, helping with their Sunday brunch. She has to give 2 weeks notice if she won’t be able to work. Since she works this Sunday, it is too late to give notice, so she may loose her summer job. Maybe the restaurant or the government will close first. Either way she is likely out of a summer job! She will be OK whatever happens because she has a modest rainy day fund too! (Something to do with with a certain type of old fashioned father and no fancy red sports cars until you can afford one!)
Since it is still winter here in Toronto, Canada, hibernating is what we have been doing for over 4 months now, so this quarantining business is not much of a change for us. Spring doesn’t really arrive till mid May for us.
I am dealing with my daughter, so my more vulnerable wife can keep her distance. Yeah, we are worried, but what can one do? It is something we can’t control.
So life continues.
WES,
Good grief!! All the best to your daughter, and to you all.
I get the impression that we’re going see more of those comments as time passes.
WES,
My heart goes out to you. Good luck caring for your daughter. I hope she makes a swift recovery.
I also hope your other children are able to get out of work without losing their respective jobs. My wife ended up taking early sick leave two days before the lockdown began. My sister, a mother of two young children, is in a primary-care role in the UK but like me, she also suffers from asthma, making her acutely vulnerable to the illness. Every day she goes to work is a nightmare for her.
Best of luck to all of you,
Nick
WES : Sounds like your kids have to face challenges just like mine will in Ontario.
What really worries me is the shortage of ICU beds and ventilators. My youngest daughter works at 2 major hospitals down in the Niagara Region although she’s been off on Maternity leave since Jan 9.
I asked her how many ICU beds and ventilators there are among the 4 hospitals servicing the approx 500,000 population in this area with at least 30% being retirees .
Short Answer : less than 100 . In other words if you are in the most susceptible demographic PRAY you don’t get sick !!
I always expect the unexpected so I prepped for it and am good for 6 months if things go sideways and a lock down like Shakytown happens.
So far it’s been the usual hoarding of buttwipe, alcohol, wipes, sanitizers at most local Costco, Walmart and various grocery chains.
Best of Luck to All
I was pointing out a couple of weeks ago that Canada did nothing, allowing hundreds of thousands flying in from the hot spots for the last more than 2 months because it was ‘racist’. Exactly the same thing happened with the SARS episode in 2003 and 43 people died in Toronto alone, and the feds never stopped the planes coming from the hot spots. Nothing learned, Canada is a joke.
Now all the politicians, especially the PM, are grandstanding with supposedly extreme measures, but still not testing, don’t bother us until you’re in total distress because we don’t want to congest the emergency departments.
Anyway, the lemmings have been crowding the supermarkets for a couple of days after the stupid media-induced panic, but things have calmed a bit. Actually, comparing people with lemmings besmirches the good name of lemmings, but we could just as easily blame it on the disgusting media. It’s how they make a living.
I wonder what the total cost of a hospitalization for covid-19 is in the US? For those with a Bronze level Obamacare plan, I believe they have a $7000 deductible and a 20% co-pay. Sure sounds like bankruptcy to me.
Here in Qingdao, China, where there is no national health care, the cost is zero. They don’t want anybody staying away from the hospital because it costs too much. They take your health insurance card and charge it, but any excess charges are picked up by the government. If you have no insurance, they pay 100%.
How about those instant ‘hospitals’ they slapped up in two weeks. Of course they are no such thing, they are at best a hospice. Their main function is to keep the unconnected out of the real hospitals.
roddy6667,
It depends on the health plan. There is a “deductible” and there is “maximum out of pocket” — so the deductible may be $2,500 and the max out of pocket may be $4,500. Once you hit the max out of pocket, everything is free in the calendar/plan year. If you’re in the ICU, you may hit that on the first day.
There are plans with max out of pockets for individuals as high as $7,000 or even higher. But most plans I looked at, the max out of pocket per individual is lower than that. Ours is $4,500.
These high deductible plans can be used with a Health Savings Account (HSA), which is like an IRA account, where the annual contribution is tax deductible. For 2020: max contribution for individual = $3,550 and for family = $7,100. So if your family is in the 30% tax bracket, you save $2,130 in taxes, which goes a long way in paying for your premium.
And because you have a high-deductible plan, your premiums are lower. If you don’t get sick, it’s very low-cost health insurance. And if you get sick seriously once every three years, you can fund the max out of pocket easily from you HSA balance and have plenty of money left over which you can save for retirement. Unlike an IRA, you never have to pay taxes on this money.
The combination of high-deductible plan and tax-deductible HSA was a sweet deal signed into law by the Bush designed for healthy high-income people, and it made it into Obamacare.
But it is toxic for low-income people (because they cannot benefit from the HSA deductibility) with chronic health conditions (because they have high expenses every year).
62% of Americans live paycheck to paycheck and are broke before payday. They can’t afford a $400 car repair or medical bill. Line up 8 Americans. That’s 5 people out of the 8, on average. The numbers you quote are like millions to these people.
It’s scary what they’re doing in retirement homes here in California. They’re practically like prisons – most activities cancelled, no visitors or heavy restrictions on visitation, they’re even closing down the cafeteria and bringing food to the units.
My mother knows a lot of people in the facility her father lived at, and keeps up with visits and such. These people are definitely getting stir-crazy cooped up in small rooms with scary news and nothing to look forward to. Hard for them not to get depressed.
I know that this is the population that needs the most protection, but I also know from hotel jobs how crushing it is to spend too much time alone in a tiny room.
The world will never be the same after this crisis … for better or worse we’ve got another “new normal.”
I count my blessings being where I am now – I’m under a 2-week quarantine from work because I just got back from a trip to Portugal last Friday. I’ve been staying in hotels during the workweek for the last 8 months so now I’m at my mothers house which is very nice and I don’t have to worry about rent. Lockdown in this low-density suburb is voluntary and nowhere near as bad as lockdown in a high density city. Keep your spirits up.
I am in the Spanish lock down in Andalucia at a town on the coast called Torrox Costa, about 45k’s east of Malaga. Our local authority started shutting the beach front and all the shops and cafe’s on Saturday morning which caused chaos. I am part of the Great British Motorhome Community which like the “snowbirds” in the US head south for the winter. There has been a lot of confusion and false news, and most of the false news seems to eminate from Facebook sites who report rumour as fact.
Andalucia has very few cases of the virus and zero deaths as at yesterday but the local administration is frightened that people from Madrid which has been hard hit, will head south to safer areas. The local campsites have been banned from taking new bookings, which is a relief.
We could head home, but at present there is too much confusion about which regions are shutting down through traffic and which borders are closed. The Brits are sitting tight at present because this area has a very low virus count and we are waiting to see how things pan out. There is food in the shops, ciggies in the Tabac and the sun still shines. The local police got a little excited about folk walking dogs and have banned dog walking more than 100m from your dwelling. I went out to the local Lidl on Monday morning 1 hour after the lockdown started and there were no police in sight and food in the shops.
Our view is that the 15 day lockdown will turn into 6 weeks, just like most other places.
One big problem is that the local Hotel Owners Association in Malaga is shutting down the hotels, as they are doing in Benidorm, but there are very limited flights back to the UK (they are full anyway!!) for the displaced guests to travel on.
Update as at 1730CET.
The Spanish Government has announced this afternoon that all hotels in Spain will shut by Tuesday 24th March. This will prove interesting for UK holiday makers as most of the airlines from the UK have stopped flying to Spain as they don’t want their aircraft caught on Spanish soil if regulations suddenly change. Benidorm is a “Brit resort” and putting thousands out on the streets without their ability to get home might prove counter productive.
The “law of unintended consequences” is starting to kick in. Ferries from Spain to the UK are starting to give priority to freight lorries carrying agricultural produce to the UK supermarkets. The supermarkets need the produce, and the growers in Spain need their market, but the tourists need a route home. If the motorhome community is delayed leaving Spain they may well face problems arising from the EU laws that require vehicles to be registered locally if they spend more than 180 days in country. Some of us are running out of MOT validity, and DVLA will not accept an EU MOT/ITV as valid on a UK registered vehicle. No MOT means no insurance cover which means our vehicles will cease to be street legal in the EU. and so on………….
Meanwhile, the sun is still shining!!
There are many absurdities in the Spanish lock-down.
But, just down the street from my Catalan cousins, the police nobly intervened to save the Tierra Sagrada of Spain.
They arrested 4 young men who’d sneaked out from their flats to smoke pot in a car…
@Nick/Don,
I feel for you. Living in the southwest of France and having spent lots of time in Spain, now being subjected to the same lockdown regime as you, I can imagine how tough things are. I wish you all the best.
Here in France we are now also to stay at home, and we need to fill in a special declaration when we have to be out on the street, for example to go to a pharmacy or grocery store. Police are about everywhere and checking out your story, if you are not clearly somewhere between your residence and your claimed destination, you are liable to be fined 135 to 375 euros. It feels like some of the dystopian novels I have read, Stephen Kings’ “The Stand” comes to mind. I hope for a better ending though.
Already I feel that these draconian measures are creating their own counterforces, or blowback if you will. I am living in a dilapidated farmhouse on a big lot in the middle of nowhere, so I do not have any serious problems yet. However, I cannot begin to imagine what life is going to be in the days ahead for a couple with kids living in some small apartment in a big city, not to speak of a “banlieue”. I fear that the resulting misery cannot be contained for a long period. Right now it feels like a pressure cooker with the safety valve screwed tight. Wouldn’t surprise me if within a week or so this thing is going to explode in violent protests and riots in the city centers. The yellow vest protests will probably seem like a walk in the park compared to what’s coming.
We’ll have to wait and see.
I am half French myself on my mother’s side (the other part is Italian, pity me) but I fully approve of your analysis.
The French government will have to learn something from the Italian experience: they’ll have to show everybody their lockdown measures are effective, unlike Italy where seemingly nothing has worked so far including effectively killing the toursim sector (over 10% of the GDP) just before the lucrative Easter vacations.
If the country is kept on full lockdown for more than two weeks with no improvement we may witness some fireworks, but knowing how the country works most gunpowder will just be added to the big pile waiting to blow up.
Patience. The curve doesn’t bend overnight. It takes time. Two weeks at the beginning of an outbreak is not long.
I’m Spanish and for a week now I’ve only left the house for 10 minutes a day to walk my dog. I’m starting to lose my mind.
Álvaro,
Yes, and you’re not the only one. “Cabin fever” is going to be a real issue to be reckoned with. Humans need to get out and interact with other people and move around. Being cooped up for a long time is very painful.
All the best to you.
Thanks, Wolf.
Time to try the Spiritual Exercises of San Ignacio e Loyola.
Then you really will lose your mind.
The final stage is giving a donation to Opus Dei.:)
All my relations are already going nuts: although given the family genes it’s hard to diagnose the cause exactly. …….
True problem is my company expects me to telecommute and keep productivity as high as before. But my mind is already faltering…
Living in Manchester UK and , of course, being English, I can spend the next month or three gardening, fixing a broken fence after the storms, grow the odd veg and get a good sun tan(when it is sunny) to pump up my vitamin D levels. I can also walk my Staffie on the park behind my paid for house (yep I’m an oldish git)….. If I want to, I can cycle down the canal into the countryside. If I need to, the hospital is a two minute walk from my front door (though that may be full to the limit) I have a largish stock of food and can also last two years with nothing financially coming in (dosh that is)……….Hopefully things will not get as bad as I think they will but they probably will.
Now, if the last anti-christ turns up to save us all, only then will I get into deep trouble as he won’t like me…. happy days
I’m looking at covid cases based on this link. I have it set for China you can choose other nations. Based on this with reporting starting about Jan 22, China broke acceleration in spread by about Feb 13.
In the U.S., it looks like we’re in a big acceleration mode and not yet finding a plateau as China has.
Other nations, like Italy, seem to have slowed the acceleration but have not yet on a good looking plateau, and yesterday unfortunately was not a good day with a healthy (no pun intended) jump in reported cases.
Based on yesterday’s reported cases in Spain, we might be able to hope Spain is entering it’s plateau.
For the nations in blue, you can click and find graphs showing daily cases and visualize the acceleration/plateau.
https://www.worldometers.info/coronavirus/country/china/
Good morning Nick, and thank you for the article,
A couple of notes of interest:
Mr Gates, who for years has been among the top two or three richest men on the planet, has resigned from all of his corporate responsibilities. He has decided that the only breath worth taking is one in which you help your fellow man; thus proving that the teachings of a certain individual of unknown Bethlehem address appropriately 2000 years ago are still relevant.
A couple visiting their local restaurant had a bill of approximately $90.00; they left a tip of $1900.00 in cash and an additional $7500.00 on their credit card …for the staff. The owner has said that each of his 30 employees will receive approximately $300.00. ( I read this on the internet a day or so ago..I cannot verify that it is true)
We are most fortunate to live in “interesting times” and while we cannot control events I recommend that those of us who are better off consider some new “ rules of the road.”
Instead of tipping 20%… make it 200%…so when that pizza and wings you ordered gets delivered don’t tip the customary $10.00. …make it $100.00
Visit your local bank, drive up window of course, and get a brown bag of $50.00s. Stuff some in your pocket and when you are out…groceries or whatever, give them out freely…assume the person in front of you, is in worst shape financially than you.
Those of us who have been blessed by providence to live in this country must take extreme measures to counteract this panic that is being sown by our leaders and the media. I am not downplaying the seriousness of the situation….this is real…this virus is a killer. However, since we cannot heal…we can demonstrate that we “see the other” and that we care. May we join the author and say, “it is a far better thing I do today than I have ever done.”
Wolf, I think you should ban comments which downplay this health crisis. They don’t help humanity.
Must read: https://www.iaslc.org/Portals/0/Editorial%20(Carbone).pdf?ver=2020-03-02-221054-687 Carbone is a friend of a friend who used to be at Uni Chicago.
OK, then, go ahead and get it, but make sure you don’t clog up the ICU when you can’t breathe because, you know, it’s just the flue.
Those numbers are iffy. Numbers I read are: 20% get very seriously ill, and quite of few of them end up needing to be on a ventilator, and a significant portion of them die.
Glad to see you are okay. Good health to you and your family, Wolf.
BERNARD,
Thanks, we’re OK. Just to make sure, the article was written by Nick in Barcelona. And Nick and family are OK too, but they did get hit financially.