June 2016 Newsletter


Closa

Closa

Lunes, 26 Septiembre 2016 00:00

If you had warned me!

If you had warned me!

Between October 19 and 21, ACG Barcelona hosts the most important event of Corporate Finance in Europe. It is a unique opportunity to meet hundreds of companies that are aiming to expand through acquisitions, Private Equity, lenders, advisors of all kinds, etc. from all over the world. Mafalda said: as usual, the urgent does not leave me time for the important. In two days we will be able to meet many businessmen and professionals to absorb high quality information that will allow us to make strategic decisions or to become more efficient. One day there will be a crisis for which we must be prepared and, occasionally, you know from experience that we must sharpen the ax to cut the tree faster. We are warned. For information www.eurogrowth.org.

Lunes, 26 Septiembre 2016 00:00

Is corruption the main problem in Spain?

Is corruption the main problem in Spain?

From an objective perspective, it does not seem, especially when comparing the cases in Spain with neighboring countries, there are much lower numbers and recurrence. But for the population, as recorded by the CIS, corruption (43.8) is the second major problem after unemployment (75.6). Then follow the economic problems (22.8), politicians in general (19.4), health (12), education (10.4), social problems (8.9) ... Could it be that the population lacks objectivity? Culture? Is it that it is very easily influenced? We should do analysis more objectively and improve the basis for promoting quality growth. I think it is much more important to have a quality education without prejudices and greater institutional and social ease to originate more private employment. We should be more rigorous in these topics on the public level and in particular to set ambitious goals for ourselves.

Lunes, 26 Septiembre 2016 00:00

Newsletter Sept 2016

Jueves, 16 Junio 2016 00:00

Eplicsa

Miércoles, 15 Junio 2016 00:00

Entrada2

Trump, Le Pen...

Every economic crisis´s consequence is the appearance of demagogues, those who give understandable solutions easily to serious problems. In addition, the culprits are an easily identifiable group who are a minority. This is the political Adamism, to think that they are the first, that they are the revolutionists against the system and just by looking to history: Robespierre, Hitler ... The polarization that is currently living in the West materialized with Reagan and his frontal approach against socialism. Since then, the world has been radicalized. The good news is that in the USA, the foreseeable victory of Hillary Clinton can dulcify her message and return the third way that Tony Blair and Bill Clinton initiated at the time. And hopefully this time it is for good.

Miércoles, 15 Junio 2016 00:00

Entrada1

Shoot with the King´s gunpowder


This expression comes from the Flanders where every soldier received a package with their contemplated needs: A pike man less a harquebusier, to be funded out of their pocket, their armaments and equipment; the cavalry had to keep their mounts, etc. Thus, as the soldier gunpowder was paid from his own pocket, all the musketeers were careful not to shoot without an insured target. Except in cases of siege that came from the royal coffers. Why were the costs of each public service not disclosed and placed privately in competition for each citizen to choose, for example the school ?

Miércoles, 15 Junio 2016 00:00

The shades of the Spanish economy in graphs

The shades of the Spanish economy in graphs

The Bank of Spain has published recently its annual report depicting what we can call the 50 shades of the Spanish economy. Herein is a summary of some important data.

Starting with the evolution of the domestic demand which is clearly shown to be the engine driving GDP growth in 2014 and 2015, with an emphasize on the domestic consumption´s role. This rebound in consumption is tailored towards durable goods, for which the Spaniards have postponed purchasing during the financial crisis (such as changing TV, fridge…).

Graph 1: National demand and its components

Nationaldemandanditscomponent

firstlegend

However, this rebound in consumption is still higher than the growth in real wages, which could indicate that the actual growth in GDP is due to a momentary effort in household consumption. In the graph below, we can see the drop in wages that Spain suffered from since 2009 to see one of the consequences of the crisis. Today, the wages are far from what they were before the crisis keeping in mind that the inflation is negative.

Graph 2: Consumption and Real Wages

consumo y salario real 18

secondlegend

In terms of GDP, foreign demand has been falling in 2014 and 2015, while the last time we saw a fall in foreign demand was in 2007 which could be alarming. Spain seems to be performing better, but if the major economies are not doing well, this can have a contagious effect on Spain sooner or later.

Graph 3: GDP, national demand and foreign demand

pib demanda exterior3

thirdlegend

Looking at gross wealth, today it is still far from 2008 levels. The main investment of Spaniards is real estate but it is still far from recovering from the golden years levels reached in full bubble.

Graph 4: Household Wealth

riqueza hogares

forthlegend

When it comes to debt, the national debt has already exceeded 100% of GDP and the EU average despite having been well below the level of debt of the Eurozone. Warnings were in place several years ago while some claimed that Spain was solvent due to its low level of debt.

Graph 5: Debt

deuda espan 8

fifthlegend

Miércoles, 15 Junio 2016 00:00

CLOSA legal precedent in the Supreme Court

CLOSA legal precedent in the Supreme Court

After more than a decade of litigation, CLOSA has finally received from a former client the fees that they did not want to pay at the time. This incident is very important to the financial community in general as the heart of the advice is the confidence that we deposit in our clients, and as with the belief of some, that a covenant is always better than a lawsuit. Spain is a State of Law and cannot afford any type of similar performances. During the nearly 30 years of counseling and with more than 600 transactions completed successfully, it is the first time unfortunately that we had to go to this extreme.

Miércoles, 15 Junio 2016 00:00

Project with Grupo Godo

Project with Grupo Godo

Grupo Godo has reached an agreement with a selection of reputable companies to provide quality information to its audience. This new group called FORO EMPRESARIAL is composed of CLOSA (as financial advisor), AXIS CORPORATE (business consultancy), BBVA (for financing), ILV SILVER (integral support transactions), VIALEGIS (legal and tax advice) and WOLTERS KLUWER (information and software services). For example, and issued quarterly as a separate print of La Vanguardia´s Saturday´s issues, the first number dealt with company size (link) and the second one on the process of transformation (link)

Miércoles, 15 Junio 2016 00:00

Brexit

Brexit

The British citizens are to vote on June the 23rd over the faith of their relationship with the European Union. Although little research has been done over the consequences of this decision, some of the direct impacts of leaving would include deficit from trading with the EU where the country receives around £470Billion per year of foreign direct investment and 45% of its exports is directed towards the EU and 50% of its imports comes from it. Leaving the union would no doubt affect the trade with an extremely powerful trading partner. Furthermore, the country´s financial stability would be at stake and the country´s rating would be downgraded, as was confirmed by the rating agencies such as Moody´s. This would imply that foreign investors will shy away.

In the M&A market, the decision of the referendum is already weighing down. While the EU excluding the UK has seen a 48% increase in the Europeans deals announced during the first quarter of the year compared to last year, the UK had its worst quarter for deals since 2010 and the sterling has experienced the worst quarter against the Euro since 2008. Today, Chinese investors are   investing in Europe more than anywhere else in the world, drawn towards the energy, services and financial sectors, and the threat of the UK leaving has had significant negative impact on Chinese investment.

Brexitgraph

The UK was always considered as a safe route to the European marketplace and in case the exit occurs, it will no longer be a hub for investments unless very favorable trade agreements are arranged.

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