As Spain edged closer to a real estate and banking crisis that led to its recent bank bailout, Spanish financial leaders in influential positions mostly played down concerns that something might go terribly wrong.
The optimism of Spanish central bankers who went on to top jobs at the International Monetary Fund echoes the attitudes of officials in the United States who misjudged the force of a housing collapse several years ago that crippled banks and the economy. And it underscores the complications that can arise when government officials take watchdog roles at international agencies that pass judgment on the policies they once directed.
Spain’s travails have now become central to the festering financial problems in Europe. The country’s biggest mortgage lender has failed, and European leaders are scrambling to prevent the Continent’s crisis from spreading further.
“The I.M.F. should be saying unpleasant things to countries to get them to reform,” said Jonathan Tepper of Variant Perception, a London-based research firm that in 2009 published one of the first reports to warn that Spanish banks were in serious trouble. “They have been quite late in Spain.”