Spain may need sovereign bailout

At present, the EU is bailing out Spain's banking sector to the tune of about $120 billion. But that's a drop in the bucket if Spain needs a bailout of its economy. And given the signs from Spain's economically autonomous regions, it could be that the day is fast approaching when Spanish debt will sink the euro once and for all. Washington Post: Spain's borrowing rates hit a record high on Monday, increasing the risk it might need a sovereign bailout, as investors worried the government would be overwhelmed by the debts of its banks and regions. The yield on Spain's 10-year bond spiked 0.22 percentage points to 7.45 percent. That is the highest level since the euro began in 1999 and is considered unsustainable for more than a few months. Stocks tanked as much as 5 percent before recovering slightly after the Spanish market regulator banned short-selling of shares. Concern over Spain increased after the central bank said Monday that the economy contracted by 0.4 percent during...(Read Full Post)