The street is a cold place to sleep

The government, the Bank of Portugal, the Central Bank of Europe, the OECD and other agencies ad nauseam all predict, conditions considered, a rather low contraction of the Portuguese economy for 2012.  The government found the number 2.8% in la-la land and are suprisingly the official pessimists.  In 2013 they bet on growth - it has been visualized in the smoke of the hash pipes and been confirmed by the government chief astrologer.

I will eat my old hat if it does not become much worse.

Several sources today (here is one) can inform us about a rising number of people and families not being able to pay their mortgage. One number advanced is 500% (this source is left wing and does exaggerate a little).   However, it is evident that lower income and the rising unemployment make a mortgage crisis to be expected.

Several of the sources agree we are talking about currently 668000 people who are behind.  122 are added every day.  My source de jour claims 140000 families have stopped paying for good.

And the real austerity measures have not even been implemented yet.  

Pray do explain, how many more do you think that will be at the end of next year?   Maybe I am not the brightest light in the blogosphere, but I do not understand the government budget or the economy forecast.  Are you betting on creating additional demand by building half a million new houses and filling them with furniture?  Or are you going to bail out the banks?  Are you going to pay the mortgages for the unemployed?

To entrepeneurs:  I foresee a business opportunity in blankets.

When I started working in Lisbon 20 years ago, it was common early in the morning to see children sleeping on the warm air vents of the metro in the street.  At the time, a police commander in Lisbon was quoted "there are 1000 children living in the streets of Lisbon".  This horrible problem was solved, I presume, as you do not see children living in the street anymore.  But if the politicians do not get their act together - it will happen again.

Update 10.11.2011: The European commission are already counting with -3% growth in 2012.  Already the government estimates are being questioned.  And my hat eating looks even more unlikely.  When the estimates are over 5% - then I might start giving them some credibility.  We will be lucky if that is all...