spainloansThis is Slog chart of the week so far.

It helps explain why, although some investors see signs of recovery in Spain, they are actually signs of something else….yes, those empty banks that The Slog has been boffing on about for over two years now.

Housing booms are never good for an economy in my view. When the entire bloody economy has been historically based on a housing boom, it is a serious disaster. As the above chart shows, the bad loans total in Spain is plummeting because, um, the banks have been lending – literally – less than nothing. The actually percentage of bad debt is going through the roof.

This is not an economy emerging from anything except the frying pan. If the main sector of the economy lacks the rocket fuel to lift it out of depression orbit, then Spain is a rocket out of control and without engines. Rockets without engines, research suggests, do not good gliders make: the ball of fire beckons.

Earlier at The Slog: Mark Williams-Thomas and his amazing mastery of English