In November household consumption dropped again, this time by 7.2%. At the same time, the Bank of Spain confirmed the economic slowdown announced by De Guindos, upon verifying stagnating investment, the rising price of credit for families and the loss of tourism and exports as fuel for the economy.
On the one hand, uncertainty about the euro is paralyzing decisions and credit flows. On the other hand, austerity policies are accentuating this trend.
Further, the debt burden that is fed by our unstable peripheral countries is stymieing growth internally. This situation demands that we adjust prices and salaries in order to charge competitiveness in the near term, something that an effective labor reform could allow
