Bloomberg Ignores its own Articles

A more realistic view of the Spanish budget deficit from tradingeconomics.com

A more realistic view of the Spanish budget deficit from tradingeconomics.com

Spain 2012 Deficit Slippage Looms as Recession Deepens – Bloomberg.

Bloomberg has been reporting on the Spanish budget deficit all year, so you would think that they would be in a position to verify the numbers being reported by the Spanish Finance Ministry. Alas, the news agency does not read its own articles, which show that Spain is fudging the numbers.

Ministry data showed the budget deficit being 4.37% through November. I wrote a post on the history of deficit reporting here

https://dareconomics.wordpress.com/2012/10/29/mainstream-media-parrots-spains-dodgy-numbers/

All of the cites for the numbers that I am sharing with you are in that post. I relied on Bloomberg for ALL of the numbers:

Somehow, Spain is massaging the numbers. In a few months, it will revise the 2012 budget deficit upwards while no one is looking.

In the meantime, keep in mind that the budget deficit does not include the cost of a €100bn bank bailout. Next year, Spain will have to sell many more bonds than is anticipated to cover this year’s larger budget shortfall, the increasing cost of the bank bailout and the financing needs of the regions.

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2 thoughts on “Bloomberg Ignores its own Articles

  1. As far as I know, the reduction in deficit at years end is due to the VAT raise and creative accounting to put down some of 2012’s expenditures as 2013. Next year’s gonna rock.
    Happy holidays!

    • I read that the tax increases subtracted 1.1 percentage points from the deficit. The large drop in the deficit starting when rates hit an all-time high is troubling. Creative accounting is a logical culprit. Next year’s deficit will blow the doors off.

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