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Spanish Business Owner Blames Banks for Housing Collapse

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  • Description

    FBN's Ashley Webster on the state of housing and reform in Spain.

  • Duration 2:54
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-- to Greece where that new Democracy Party leader and Thomas -- Mars has been sworn in sort of today -- Prime minister after reaching a deal to form a coalition government there.

With Greece's issue seemingly resolved for now it's on to Spain where the country's readying a request.

For a one billion dollar EU bail out more than that really actually Webster joins us live from Madrid with the latest -- -- Hey day in and -- -- well yep we've moved from Athens to Madrid Spain but the story remains the same.

As you said actually a 125 billion dollar bail -- on tap for Spain's shaky banks but there are real concerns that the economy here.

Could need a full -- to bail out in the numbers are too hard to imagine.

But there are certainly the borrowing costs for Spain remain high -- despite the bailout promise on the banks.

Borrowing costs around 7% considered just not sustainable.

Spain's housing market collapse has led to unemployment rate here of close to one in five close to twenty.

5%.

I spoke with the owner of a real estate web site here in Madrid who told me that.

Those -- housing market numbers will continue to full but he says the blame is squarely on the banks.

What because of the -- there'd be for you from Rome where we saw in this phase home so in the UK was.

How quick adjustment of the prices if Spain presents have -- -- quickly.

It is the I was born in this they have you know from twenty to 50%.

When we should have been at least 50%.

Why these tough talking.

If you go of the -- a couple of being.

-- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- Who get that from the European central about a 1% from the food and it.

And public debts of Greece and Spain Portugal and I'd -- five foot 6% to -- somebody big business somebody to do.

But now of course those banks are left holding gold those bad loans it's something we've seen -- around the world and the question is how long can I hang onto them before they need to have bailout.

In the meantime there are some painful reforms underway both for education and for benefits.

Pensions in particular social reforms and duck label -- reforms and because of that we are expecting some protests to begin.

Here in Madrid and across the country in less than two out so well certainly go down and -- gauge the the thoughts of the people here in Madrid who are upset at these reforms.

But military guys almost everyone has spoken to so far here says they have absolutely no faith -- -- in the politicians.

Who they say they don't know what they're doing so therefore they're very worried.

About the future and I guess you could say that's somewhat of late will wide belief exactly right -- -- alive today from not Madrid Spain.

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