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Follow on Google News | Support Real Discuss The Possibility That Spain Isn't The Next GreeceToday the Spanish government announced the full, uncut version of its austerity budget – labeled the toughest budget the country has seen since Franco.
By: Support Real Admin More people losing their jobs (unemployment is already at record levels with youth unemployment at 50.5%) are also likely to force more Spanish households into the red. In reality this means that more individuals and families will fail to keep up with their mortgage repayments and banks will almost certainly face hefty losses as a result. This is a particular concern for the euro as a whole since Spanish banks are currently the chief buyers of Spanish government debt, meaning that if these banks suffer, it could also cause Spanish government funding to dry up. The chances of a self-fulfilling bond run on Spanish debt would thereby increase massively. Support Real S.L has had massive success this year so far with the MD saying, ‘companies that are doing well and building a strong foundation in Spain need to share their success tips and help other entrepreneurs to do the same. Networking has always been essential to my success and I would not be where I am today if not for certain business partners.’ And as today’s budget shows, Spain simply doesn’t have the cash for a major bank bailout operation if the situation is allowed to spiral to this point, meaning that the eurozone’s permanent bailout fund, the ESM, could be forced to step in, transferring the risk to eurozone taxpayers. Fortunately, we’re not there yet and Spain is definitely not "the next Greece". In order to avoid prophecy becoming reality, Spanish banks should be required to at least double their provisions against souring loans at a time when there’s credit in the EU economy (mainly as a result of ECB financing) and relative calm. As ever, Spain is too big to be bailed out. If eurozone policy makers repeat their habit of failing to take the right decisions early, the risk is that Spain and the eurozone will pay a very high price indeed. Being aware of the problem is the first step in making a change in the right direction. ‘Time will tell how government deals with the issues at hand – all we can do is wait and hope for the best,’ continues a source from Support Real S.L. http://blogs.telegraph.co.uk/ End
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