MALLORCA TODAY - Government was warned about crisis

In what the Spanish paper "El Mundo" describes as an "explosive document", there is evidence that in 2006 the inspectors at the Bank of Spain warned the government and in particular the vice-president and finance minister at the time, Pedro Solbes, of the potential for the economic crisis that eventually took hold. Special concern was reserved for a "fragile" real-estate market as well as a bubble in the financial system that could have dangerous consequences. The revelation of this document will be a blow to President Zapatero who, despite winning some praise for his recent handling of the economy, had been previously blamed for an inadequate reaction to the crisis.