Spain impeding free movement of capital in Europe

Will the rich get their assets out of Spain before Zapatero manages to fleece them?

That’s a feasible interpretation of the authorities’ assault on savings expatriated to Luxembourgois tax-efficient bespoke insurance vehicles, which comes in the context of rapidly falling tax revenues, substantial jitters among investors about the government’s intentions, and ferocious intra-European competition on corporate taxation. I’ve got a small bet that Frankfurt and Brussels will collapse in a heap of expenses claims just before Gordon Brown begs to join the Euro, but it may be a damned close-run thing. [Since we’re collapsing into a new world, space here for Gene Expression’s suggestion that since there is still no cataclysmic personal downside in sight for bankers who screw up (Geithner does nothing in this respect), the only solution is to encourage them to believe that they will be shot.]

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