Sunday, October 2

The minority wins

Last Monday we had breakfast with the news of the confrontation in the Council of the largest Spanish listed real estate agency. On the one hand, the main shareholder – Banco Santander, which currently owns just over 20% of the company – and on the other, its executive team, led by Ismael Clemente as its CEO. That same afternoon, an Extraordinary Council of urgency with a single point of the day: the dismissal of Ismael. The result is well known: against all odds Santander did not take the cat to the water. The continuity of the current top executive was not even voted on.

to reconsider your proposal, the fact that Ismael Clemente continues to lead Merlin it’s the best possible news for the minority shareholder. Clemente and his team are the ones who have made Merlin what it is today. In just over six years they have built the largest listed real estate in Spain. They are leaders in offices, logistics and shopping centers. They have levers to continue growing in the fastest growing niches – North Castellana District, logistics, data centers – through eventual divestments in more mature assets that today are very attractive.

The high salaries of the executive team are, apparently, what Santander clings to to promote change. The remuneration model is nothing new. It is practically the same as the one in the company’s IPO brochure. It has been under the scrutiny of the shareholders for a long time and its amendments have been approved at the General Meeting. In any case, it seems a bit far-fetched at this point in the party to promote a change of such depth from one day to the next and without prior notice. Ismael (and team) are the ones who have made Merlin what it is today. His deep knowledge of the sector is his best guarantee to continue at the forefront. And that is the most important thing for the minority shareholder. The rest are plays that escape the common of mortals.

Good news

The agreement reached on the labor reform is good news. And not as some point out because this has been achieved by consensus, since it is well known that the goodness of the measures does not necessarily have to do with the support they reach. Nor, probably, because it was a step in the right direction because we have practically remained as we were in labor matters.

The good thing that this reform has been approved is that it confirms the thesis that some of us had that the fact of running into reality defies the reckless.

The current government coalition, of which, as we all know, the radical left-wing Podemos party is a part, in the time they have been in charge – which is three years – they are failing to fulfill practically all their commitments in economic matters. They have not nationalized any bank as they had written in their program.

In fact, have merged Bankia with Caixabank, taking a step that the previous conservative government did not dare to take at the time. Nor have they intervened the price of energy. And not because the price of electricity has not risen, because it sets a new record every day, but because there is no easy solution. Once they understand the marginalist pricing system, they just put candles to lower the price of gas.

And, if all of the above were not enough, last week it was confirmed that they do not repeal the labor reform. Regardless of each other’s stories, this Government has not fulfilled its main economic promise, which shouted to the four winds PSOE and Podemos and with which their mouths filled: the repeal of the labor reform of Mariano Rajoy.

Not because it is expected, it ceases to be magnificent news. Test passed. Another gift and surely not the last this Christmas. We leave simple solutions for complex problems for a better occasion.

Meanwhile, while for other countries, for example, populism has found it difficult to continue in the European Union, here it is happening (it has happened) with more pain than glory.


Last week also touched on the revision of the INE data. As expected, they revised up the third quarter data. The review raises several reflections. On the one hand, that the national statistics be reviewed – now in the opposite direction – is something serious. And, especially if we take into account the magnitude of the review. It is not at all anecdotal that, compared to the fall that they pointed out in their first estimate, consumption ended up rising more than one point in the third quarter. These comings and goings show that right now they are groping. The models used so far are not useful for measuring the evolution of GDP.

On the other hand, it gives the feeling of a certain kitchen. The review is in the direction that all the indicators pointed, but it seems that it falls a bit short. In the pulse that this issue seems to have become, it seems that the national institute is struggling to twist its arm and acknowledge its mistakes.

It is not a trivial subject at all. And the sooner failures are recognized, the better for everyone. And, finally, we must point out the different treatment that the media makes of the same information but in the opposite direction.

The The downward revisions of a few months ago had much more echo than, of course, those that are having the upward revisions. In addition, the fact that the few have deepened in the controversial review of the data, remaining in the thick and populist headlines should at least provoke reflection.

Today the doubts about the reliability of the models that measure the evolution of the National Accounts are still absolutely valid. This latest review if anything confirms that they are completely overwhelmed by the current circumstances. Now it will only have its place if future reviews serve to throw them in the face of the Government. That a subject of this importance is treated so superficially is to make you look at it.

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