Things are unraveling in Europe at a startling pace. The country inthe greatest danger is Spain, which could become the fourth memberof the euro zone to require a bailout, following Greece, Ireland,and Portugal. Spain s 709 billion euros of sovereign debt isroughly twice the debt of those three nations combined, accordingto data compiled by Bloomberg, so a rescue of Spain would be aheavy burden for the rest of Europe. Investors got overconfident in Spain after the European CentralBank announced last December that it would funnel cheap, three-yearloans to European banks, which they could (and did) use to investin the debt of their own nations. The ECB lent more than 1 trillioneuros. Spanish government 10-year yields, which were over 7 percentlast November, plummeted to below 5 percent this January andFebruary. They have raced back upward, to just below 6 percent inrecent weeks. Spain s yields started jumping in early March, after PrimeMinister Mariano Rajoy announced that the government budget deficitwould miss the 4.4 percent of gross domestic product target thatthe previous administration had agreed to with the European Union.The problem is that the easy money from the ECB didn t do anythingto fix Spain s fundamental problem overindebtedness and anuncompetitive economy that, because of the common currency, can tuse depreciation as an escape hatch. Bloomberg News reports today that Rajoy is targeting basic public services for the first time since his election in December in a bid to convince investors hecan bring order to the nation s finances. But Mark Grant, a managing director at Southwest Securities in FortLauderdale, says that the education and health benefits that Rajoywants to cut do not totally come under the purview of the Spanishfederal government. Writes Grant in a note to his customers today: Even if theFederal government could get the cuts accomplished, it will takethem months and perhaps months and months so that the headlines ofwhat Spain is going to do has all of the substance of the milkyfroth atop some cup of coffee in Valencia that resembles acappuccino. So not only does Spain have financial problems it has Americansdissing its coffee. The e-commerce company in China offers quality products such as 808nm Diode Laser Hair Removal Manufacturer , China Yag Laser Hair Removal Machine, and more. For more , please visit IPL Hair Removal Machine today!
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