Spain: Stupidity with a big S - Catalan referendum to hit Spain economy, no matter who wins - by Esteban Duarte and Angeline Benoit

Spanish Prime Minister Mariano Rajoy is battling to keep his country together, facing down Catalan separatists. Even if he wins, the standoff risks weakening the economy that the two sides are fighting over. Catalan President Artur Mas, backed by about two-thirds of the region’s lawmakers, is defying orders from Spain’s highest court and pressing ahead with a vote on independence on 9 November. The wrangling last week pushed the gap between Spanish and German bond yields to the widest since Scotland voted to remain in the UK, while support for Rajoy’s People’s Party is tumbling, according to a poll published by El Pais on Sunday. “Investors are pricing the risk of political instability in Catalonia,” said Francesco Marani, a fixed-income trader at Auriga Global Investors SA in Madrid, who trades government and regional debt. “The independence issue has already been hurting the Spanish economy, and it’s not over.” Spain’s economy is losing momentum amid a slowdown for its European trading partners. Uncertainty over the future of Catalonia, whose contribution to the Spanish economy is twice that of Scotland’s to the UK, risks undermining investment as well as pushing up borrowing costs and distracting politicians from tackling the 24% jobless rate.

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Spanish Prime Minister Mariano Rajoy is battling to keep his country together, facing down Catalan separatists.

Catalan Independence - Stupidity with a big S

Even if he wins, the standoff risks weakening the economy that the two sides are fighting over. Catalan President Artur Mas, backed by about two-thirds of the region’s lawmakers, is defying orders from Spain’s highest court and pressing ahead with a vote on independence on 9 November.

The wrangling last week pushed the gap between Spanish and German bond yields to the widest since Scotland voted to remain in the UK, while support for Rajoy’s People’s Party is tumbling, according to a poll published by El Pais on Sunday. “Investors are pricing the risk of political instability in Catalonia,” said Francesco Marani, a fixed-income trader at Auriga Global Investors SA in Madrid, who trades government and regional debt. “The independence issue has already been hurting the Spanish economy, and it’s not over.”

Spain’s economy is losing momentum amid a slowdown for its European trading partners. Uncertainty over the future of Catalonia, whose contribution to the Spanish economy is twice that of Scotland’s to the UK, risks undermining investment as well as pushing up borrowing costs and distracting politicians from tackling the 24% jobless rate.

Note EU-Digest: Nationalism - where small areas of Europe seek independence through referendums is not a smart thing to do in today's world  of economic blocs. Basically it is  stupidity with a big S . Nationalists eventually shoot themselves in the foot - and the Catalan independence movement is no exception.

Read more: Catalan standoff to hit Spain economy, no matter who wins - Livemint