Terry Smith: What is the Spanish word for zombie?

SPAIN

Fundsmith founder Terry Smith discusses the merits of recapitalising Spain's zombie banks and explains the sector's parallels with Japan's 'lost decade' in the 1990s.

'El zombi' is Spanish for 'zombie'. The term 'zombie' is used to describe an economy in which failing companies continue to operate with government support. The term traces back to Edward Kane's (Kane, Edward J. (1989). The S&L Insurance Mess: How Did It Happen?) explanation of the situation of insolvent savings and loan associations in the 1980s. But it is most commonly used to describe Japan in the early 1990s. After Japan's real estate bubble burst at the end of the 1980s, there was a conspiracy aimed at keeping its banks which were bust lending to real estate and other affected compa...