Chicago my friend... Very intelligent, fair and balanced reply. I'll tell you, for somebody who doesn't live over here, you sure do understand life in Spain better than many Spaniards do. Bravo. :cheers: I have a few comments to your post bellow:

quote:

Originally posted by chicago:
[qb]3-Spain has a huge underground economy. I'm not talking organized crime or drug trade. I'm talking about the maid who comes to clean your house, the guy working under the table in a bar or restaurant, or the small business owner. Spain has an official unemployment rate much higher than most of Western Europe or the US. But they also have an underground/non-taxed economy many times bigger than the other countries as well. [/qb]

You're absolutely right. I have no idea what the official numbers or stats say on this, (Not to mention, I'm sure they're most likely wrong if they keep them) but I'm sure it's a very large number of citizens, both legal and non, who are effected by this. That's why Spain's unemployment numbers are pretty much never reliable.

quote:

Originally posted by chicago:
[qb]4-Spain's economy is seeing some of the price effects of fully integrating with Europe. A good way to measure the wealth of an economy is to look at the total size of the economy, divide by the number of people, and adjust for price differences (called PPP adjusted GDP). Portugal and Greece have less wealth than Spain. The other countries in the Euro zone have about 20-25% more wealth. Just like before, Euros have been coming to Spain in droves for tourism. Many of them are also now investing in Spain. If people with more disposable cash enter, prices will go up.[/qb]

I'm not an economist, nor do I wish to be one, (Sorry Val ) but I'll take your word for it. It sounds like what you're saying though is a 'recipe for inflation.' Feel free to correct me if I'm wrong on that. I've also suspected that for some time.

quote:

Originally posted by chicago:
[qb]5-The labor market prices haven't gone up as fast as prices in general. In the US, people hire someone on and if things get tough, they don't hesitate to lay someone off pay them a week or two of severance and contribute a little to unemployment benefits if the employee is even eligible. In Spain the labor market is not as flexible. If the employee gets layed off, the employer must pay a fortune in compensation.

It's good the employee gets this protection, but bad at the same time because companies are more hesitant to hire. My girlfriend was layed off here in the States this summer when her firm was struggling and she never told her parents because it's a foreign concept to them. Because the cost of firing someone in Spain is so high, people usually only get let go if they are incompetent enough to warrant it. So wages don't rise as much as prices have, making it more expensive for the typical Spaniard.[/qb]

Saying that salaries haven't risen with the increasing cost of living is the understatement of the year. In my sector (IT), we're frankly in a recession. Nobody's hiring. Some have started firing. The only new hires you see at present are 'fresh-outs,' as HR calls them. A fresh-out is a recent college/university grad with little or no experience who will work for peanuts. As you would expect then, many others who have significant experience are getting more than a little worried as PP seems to be bolstering the economy so that Spain looks good to the rest of the EU and very, very little to stimulate the employment market. So you have property prices that are rising continuously while salaries are staying stagnant (mine hasn't changed for 2 years now). It's quite worrisome. So, if you aren't presently in a home of your own, forget it and if you are, you're worried about your salary being enough to continue to pay for it comfortably. Sorry to be a 'worry-wart', but I feel like this is a realistic picture of what Spaniards and Spanish-residents are going through at present.

quote:

Originally posted by chicago:
[qb]Don't let a little extra expense scare you. I love the country and the people more than any other place I've been, and it's still less expensive than a comparable experience in Italy or France.[/qb]

Very, very true. For your 'tour-dollar, euro, yen, pound, etc.' there's still no substitute for Spain. The next year or two though will be a very interesting time for Spain economically. The boom they've enjoyed during the past several years is coming to a close. What happens now will determine how stable the economy is for some time to come. I still believe that the security provided Spain by the Euro-zone will ultimately help it stabalize itself and ensure that everything works out ok, but the Spanish government cannot rest upon these laurels and permit an 'Economic-Chapapote' to occur. (Chapapote is an imported S. American word to describe the horrid oil spill, economical & ecological disaster that has occured in Galicia in November of 2002.)