Author Archives: Daniel Moore

Debt consolidation -The simple application process to consolidate your debt


Debt consolidation includes the law that the consolidated financial statements of a company should be as if all companies belonging to it were a group or a unit. These should be not only legally but also economically a whole and there should be no debt positions or claims against each other. Prepaid expenses and contingent liabilities are to be included in the consolidation.

The simple & secure application process to consolidate your debt

What exactly is a debt consolidation?

When consolidation takes place within a group, it makes sense and content to balance the companies involved. This process is called debt consolidation, try this. It is customary for payments to be made between the so-called parent and subsidiary companies – these payments should be fully offset in the consolidated financial statements. Two-sided debts of the companies arise already by the contracts, which describe the relationship exactly. The content of these offsetting liabilities can be broad. Literally, therefore, one needs an equally broad description. In all balance sheet items of the companies concerned, the nature of the claims must be optimally recorded and a settlement can be made. Only then will debt consolidation be done. Because this assumes that the involved, so the affected companies may not have mutual debts.

What does commercial Law say?

What does the Commercial Law say?

The Commercial Code provides for an exception to simplify the consolidation of debts, and accordingly the amounts play only a subordinate role. As far as the description of the assets and earnings situation, as well as the financial position, is concerned, there is no need to admit it. Here then the consolidation would be possible without offsetting. If all the companies concerned post the same amounts, the offsets are neutral in terms of profit and are an unproblematic step. Shifts can be compensated accordingly if they all comply with the deviations of the corresponding positions. In order for settlement without effect on income to take place, loss carryforwards or group reserves must be formed.

What does unity theory include?

Unity Theory captures offsets of the company’s receivables and debt positions, which are included in a parent’s due consolidated financial statements. These are the debts that are to be offset against each other. There is a need to see all the companies belonging to the group in a single entity, the so-called unitary theory. From this perspective, there are no claims and debt positions against each other. All balance sheet items that have the nature of receivables will be offset against the other Group companies included in the consolidation with the opposite item of the liability.

The groups are positioned before the next negotiation of regional financing



Debate monográfico

Some positions that have been revealed this week in a monographic debate held at the Assembly of Extremadura, at the request of the Board, on regional financing, in order to agree on the common position that Extremadura will defend in this negotiation with the central government and the rest of autonomous communities.

This monographic debate started with the intervention of the Vice President and Minister of Finance and Public Administration of the Junta de Extremadura, Pilar Blanco-Morales, who set the position of the regional executive on regional financing, which in his opinion “can not be an excuse to maintain the performances differences of wealth “between the communities.

For the Regional Government of Extremadura, the regional funding must “promote convergence in the living standards of all Spaniards”, so the vice president claimed “maximum objectivity, rigor and transparency” when calculating “what it costs in each region of Spain to provide an equivalent level of services and public policies “.

The objective is “to end once and for all with the fallacious reproach that we Extremadura are over-financed, or that we parasitize other Spaniards,” declared Pilar Blanco-Morales.

For his part, the president of the Popular Parliamentary Group, José Antonio Monago, criticized the “immobilism” of the Junta de Extremadura on regional financing and warned that if “persists” in this attitude, it will be the PP that will promote from the opposition ” alliances “to put Extremadura” safe from ordinality “.

For Monago, Extremadura “can not continue waiting” for the Junta de Extremadura to take the “initiative” in this matter, and defended that the new financing system be governed by “technical, objective and neutral criteria”, leaving aside “the political change “, because in this way” autonomies will benefit to the detriment of others, making Spain a two-speed “.

On the part of the Parliamentary Group Podemos, its spokesman, Álvaro Jaén, said that the “top priority” of the new financing system should be “guarantee and protect all public services” and must also include dependency, all under a model based on the principles of “equality” and “solidarity”.

Thus, the parliamentary spokesperson for Citizens, María Victoria Domínguez, advocated reaching “consensus” without “facing territories”, in order to defend “common positions that benefit everyone” and achieve a model of “transparent and equitable” regional financing that guarantees “convergence” and access to public services “in equal conditions live where they live”.

Apart from the regional financing, during this week other important issues have also been addressed in the Assembly of Extremadura, such as the situation of terrestrial health transport after the change of the winning bidder, or rail transport in the region.


In this sense, also this week began the work of the non-permanent research commission constituted in the Assembly of Extremadura, at the request of the PSOE and that had the support of PP and Citizens, after the controversy generated by the public tender of health transport terrestrial and the transfer of the previous company to the new contractor, Ambulancias Tenorio.

In this session of the commission of inquiry, it was agreed the appearance of about fifty people on the terrestrial health transport contest, among which are the president of the Junta de Extremadura, Guillermo Fernández Vara, and the former president in the legislature previous, José Antonio Monago, in addition to the Minister of Health, José María Vergeles, or that of the previous legislature, Luis Alfonso Hernández Carrón.

Among those appearing, are also the current manager of the SES, Ceciliano Franco, and his counterpart during the last term, Joaquín García Guerrero, as well as health inspectors, technicians; the former manager of the Extremeño Consortium of Sanitary Transport, Eulalia Fontán; the manager of Ambulancias Tenorio, Javier Sánchez Sierra; union delegates, or workers not surrogated after the last contest and dismissed.

Once the list of respondents has been drawn up, it is still pending to establish the calendar for the beginning of the statements in the commission of inquiry, which could be set next week, with the aim that the appearances can begin during this month of February.


On the other hand, this week also spoke in the parliament of railway transport in Extremadura, following a question from Podemos in the Committee on the Environment and Rural, Agrarian Policies and Territory on the state in which the contract is located. public service between the Junta de Extremadura and Renfe Viajeros.

Faced with this question, the General Director of Transport of the Junta de Extremadura, José González Rubio explained that this contract “is being negotiated” with Renfe, although he warned that the regional executive “will not sign any contract for now that involves paying a only euro for the circulation of vehicles regionally “, due to the service that is currently being provided.

In this negotiation, the Junta de Extremadura has transferred to Renfe that can not “pay the same” as other autonomous communities for “using an infrastructure” that in the community is “very bad”, so “different services can not have the same price “, explained González Rubio in the commission.

For the general director of Transport, this issue “is the whiting that bites the tail”, since Renfe does not fix the infrastructure, which “implies that we have fewer travelers, which in turn implies that we have to pay money for an OSP we have to declare if we do not want to lose rail transport, “he said.

Therefore, the Junta de Extremadura has proposed asking a moratorium of two years to the Ministry of Development so that once this period has elapsed, during which “it has to rehabilitate the railway infrastructure”, then it will analyze “the consequences that will have the renewal of track, on the passengers of the train, “he said.

During the week the visits of the students to the Assembly continued, to know their facilities and operation, with the assistance of the IES Vegas Bajas de Montijo groups, or the Santa Eulalia de Mérida School.

The base of off-shore credit issued in dollars and its problems

Foreign savings entering the US and its function of boosting the valuation of financial assets.

But how can the dollar be simultaneously a base for off-shore dollar credit, the second aspect and condition for the existence of the dollar as a hegemonic international currency? The answer to this question is simple: what accumulates in the US, in the form of financial investments, is foreign savings. You just have to understand how this savings works in the US and then understand how it works out of the USA.

Foreign savings entering the US supplement national savings insufficient because of the excessive consumption of US households who save less and less. The equation is simple, the more Americans consume, the more they run trade deficits: they must, therefore, import the savings they need to cover their investments.

Foreign savings add to the savings of US households and businesses. This nationally available savings provides the basis for systemic monetary creation that allows the growing indebtedness of all major players in the economy: households, businesses, public administrations.

This growth in debt, supported by bearish interest rates, supports a monumental valuation of financial assets. This valuation allows their face value to deviate from their issue value. Provided they are held as real counterparties, these valued assets provide the basis for the gap between available savings and the growth of debt and the financial market debt that finances them.

As a result, US national indebtedness can increase and the financial market has sufficient financial resources – partly fictitious – to continue to expand and support the economy by providing credit volumes that exceed the level of government debt. nationally available savings.

Outside the US, off-shore dollar credit can grow steadily for reasons related to how financial globalization works. We need to take a closer look at the dollar inflows and outflows to understand the mechanism that allows the development of off-shore credit in dollars.

Net acquisitions of financial assets resulting from sales and purchases of assets by foreigners in the United States and by Americans outside the United States.

First of all, net acquisitions of financial assets by foreigners are necessarily higher than net acquisitions of financial assets by Americans outside the US, which is the basis for covering the deficit of the balance of payments by the balance of financial flows.

But capital outflows provide a sufficient amount of dollars to return some of the savings that went into the US in the form of dollars. The US market remains a hub of capital.

Admittedly, the financial market absorbs more financial investments than it returns, but the volume of refund provides the monetary base necessary for the expansion of dollar-denominated credit that is made outside the US. For this expansion to respond flexibly to the dollar credit requirements generated outside the US, it is sufficient that off-US dollar credits generated outside the US operate in exactly the same way as investments generated by nationally available savings in the US. Savings consist of US national savings and foreign financial flows.

There is indeed a paradox in the way the credit system works. If the balance of capital entering and leaving the US to vampirize global savings, credit operations made outside the US dollar would have contracted for a long time for lack of dollars in sufficient quantity, the US financial market would indeed play the role global savings trap. This was not the case since capital entering the US is valued like US capital.

Equity and mutual fund purchases – the value of which is pulled up by the stocks that compose them in part – are the best example of this dynamic. Shares and mutual fund shares can be valued with the upward movements of stock exchanges and provide the value counterpart of off-shore loans issued in dollars. The value of shares and mutual fund shares has the particularity of accumulating in the US, this accumulated capital benefits from the general effect of rising stock prices stimulated by the stock market. Equity assets are only the most visible part of this inflation, fixed-yielding assets can be accounted for with the value of their future interests or their transfer value whenever they can be sold with a capital gain. Finance does not lack talented accountants to account for virtual capital gains as the current value.

In a globalized financial economy, it is then enough for foreign holders of the capital present on the American market to include in the cover of credits they grant outside the US the value of assets held in the United States. In a globalized financial economy, the systemic monetary creation that the US practices can simply be exported out of the US because of the cumulative value of capital that has sold in the US. It is still necessary that foreign capital continue to accumulate in the USA.

We must, therefore, not a double paradox: a dollar-dominated world monetary order assumes that trade deficits persist and that foreign capital entering the US is always greater than the capital that comes out of it. It is apparently the world upside down, but this reversal is only the translation of the imbalance of US external accounts that must be corrected by financial mechanisms increasingly paradoxical. Offshore credits issued in dollars can, therefore, use fictitious values in the same way as credits issued in the US.

For the dollar to remain the major international currency and credit, it is, therefore, necessary for the US trade deficit to widen and simultaneously that the inflows and outflows of financial flows remain unbalanced. Without this imbalance, foreign capital would accumulate too little in the US to provide the basis for off-shore credit issued in dollars.

Bankia and five other banking groups adhere to the Code of Good Practices

Bankia, CaixaBank, Ibercaja, Unicaja, Kutxabank and the BMN group have also joined the Code of Good Practices to stop the evictions of families at risk of social exclusion and the rest of the savings banks are expected to do the same.

The six large boxes that make up the executive of the CECA have been adhered to the Code. As reported by the Spanish Confederation of Savings Banks (CECA), this Thursday the six large boxes that make up the executive of the CECA have joined the code, but “it is expected” that the rest of the associates announce that they will be added in the coming days.

CatalunyaCaixa and Novagalicia, both in the hands of the State, already announced on Thursday their intention to comply with the code of good practices, as well as Banco Santander, Sabadell, Bankinter, Cajamar and the rural group CRM .

The ECSC explains that the adherence of the savings banks to good practices is based on the fact that they fight against social and financial exclusion , one of the objectives with which these entities were founded.

In fact, the Confederation recalls that the entities that make up its executive had already arbitrated specific solutions for those clients with mortgages that are in situations of extreme vulnerability , such as refinancing, grace periods, voluntary payments or purchase of housing for subsequent rental to the debtor, among others.

The CECA highlights that the accession of Bankia, CaixaBank, Ibercaja, Unicaja, Kutxabank and the BMN group has “special relevance” since The savings banks are specialized in financing businesses and families and have favored access to housing owned by all layers of the population.

In fact, the market share of the boxes amounts to 55% in mortgage loans and in the case of protected housing, the share rises to 69%.

Code of Good Practices

Code of Good Practices

The Code of Good Practices is included in the royal decree-law of urgent measures for the protection of mortgage debtors without resources published in the Official State Gazette on Saturday, March 10.

It is expected that at the beginning of April the list of the entities that have accepted the text will be known. The norm established the voluntary adhesion of the financial entities to said code, during a period of at least two years.

It is expected that at the beginning of April the list of entities that have accepted the text will be known and that, as the Government has publicly acknowledged, it expects them to be many despite the reluctance initially received from the financial sector.

The families that are in extreme situation , that is to say with all their unemployed members and with little income that dedicate at least 60% to the mortgage payment, will be able to refinance the loan with which they acquired their only house, which will not be able to worth more than 200,000 euros in large cities or more than 120,000 in smaller centers.

With the refinancing, the families will obtain four years in which they will only pay interest, they can extend the term of their mortgage up to a maximum of 40 years and they will pay an interest of Euribor plus 0.25 points.

If after these measures the fee payable is still carrying 60% of the income that the family has, the client could ask his bank to study if it applies a withdrawal of part of the outstanding capital .

If you do not receive the approval of the entity or even obtaining it, the family is unable to pay your fee, you can deliver the home to the bank and settle your debt with it, having the option of staying in the rental property for at least two years.

Review of the 2010 fiscal year and growth in the US

We will give a very brief comment on the latest budget data released by the Treasury. The reference period is the fiscal year 2010.

The annual budget deficit stands at $ 1291 billion, or $ 259 billion less than the deficit anticipated by the US Treasury. The US has therefore reduced the budget squeeze because of an increased risk of sovereign debt.

This reduction is reflected in the US fiscal deficit. While the fiscal deficit was expected at $ 1850 billion, it is only $ 1652 billion, or $ 198 billion less than expected.

It will be necessary to wait for the publication of the December Treasury Bulletin to determine why the fall in budget expenditures is not reflected in the growth of the financial debt. One can think that the Treasury, borrowing for the sub-federal administrations off budget, had to abound the caisses of American territorial authorities in difficulty. This is the most likely hypothesis.

If we focus on the budget deficit – integrating the expenditure of ministries, agencies, and social insurances – it appears that they are 1.78 points of GDP (Reference point of GDP in 2010 T2 = 14575: 100 = 145 source BEA T. 1.1.5 GDP) which was not injected during the 2010 fiscal year. Can the slowdown in the recovery find its explanation in this fall?

The fall of the credit injection did not happen anytime. As our chart shows, since the beginning of 2010, budget deficits have fallen. The cumulative effect of this slowdown was in T-2 2010 a marked drop in growth.

The thesis of a recovery on credit seems to indicate an extreme sensitivity of GDP growth to the downward trend in the budget deficit. We can anticipate the poor performance of the GDP of the T-3 2010 by considering the quarterly developments in spending.

The 2009 T-3 deficit was $ 383 billion and the 2010 T-1 deficit was $ 327 billion.

The 2010 T-2 deficit was $ 286 billion and the 2010 T-3 deficit was $ 289 billion.
It is therefore likely that the GDP performance of the 2010 T-3 should be close to that of the 2010 T-2.
We will refrain from giving a figure, but we can consider that a GDP above 2% would indicate that there is a small endogenous growth engine.

It will be necessary to wait for the publication of the GDP of the end of October and its consolidation during the two following months to check if the growth is always entirely on credit or if there is a draft of recovery.

For the moment we remain in a position established for a year. The recovery is fictitious because it replaces private indebtedness with public debt. If the crisis is a depression, we continue to think that the federal state has spent too much and not enough. Too much because it has degraded US sovereign debt, not enough because the level of public deficits is insufficient to get the country out of a depression.

The drama of the USA is that they no longer have the resources and the international financial credit to raise their budget and/or financial deficit to 20 points of GDP for 2 to 3 consecutive years. This was not the case during World War II when the US really came out of the depression. The product of their weakness seems to be the country’s commitment in a Japanese-style scenario: low-interest rates, rising public debt, poor growth.

So there remains the solution of the monetization of the debt. It is a temptation that starts to inspire the reflections of the FED, but not yet its policy. Contrary to alarmist rumors about a Fed willing to monetize the public debt with astronomical sums, the policy pursued by the FED aims to combat the risk of deflation by injecting liquidity covered by deposit-taking institutions (Bank, Credit Union and savings bank) who find their account. With a credit in full contraction, the supply of credits to the Fed – so-called excess reserves – to the insignificant advantage for the financial sector of contributing to the financing of the Treasury without running the risk of buying a sovereign debt whose objective observers know that it becomes more fragile every day.

This fragility is revealed in the FED’s purchase of treasury bills, but also in the guarantee of debt consolidation and issuance of treasury bills under satisfactory conditions. That this guarantee can be an admission of weakness does not seem to have had too much impact on investors. But financial distrust sets in slowly and always manifests itself as a sudden reversal. The markets are sheep.

The US entangled in a crisis, which no one sees the end, find themselves having to assume the insoluble effects of the rise for 30 years of imbalances. And when the imbalances produce their effects, the situation returns, insoluble contradictions appear, and the crisis lasts …