Spain slides even faster towards the abyss

From the UK Guardian:

Spain's debts to hit 20-year high
Spain has set off further alarm bells among bond investors and its crisis-hit eurozone neighbours by conceding that its debts will balloon this year to their highest level for two decades.

The admission fanned fears that the recession-bound country will lose its battle to stay on top of its debts without reaching for outside bailout funds and knocked Spanish government bond prices.

Despite announcing its most austere budget for more than 30 years last week, Spain's government admitted on Tuesday that the debt-to-GDP ratio will jump to 79.8% in 2012 from 68.5% last year.

Emphasis mine -- we must not forget that the US debt-to-GDP ratio is over 100%. We owe more money than the entire economic engine of the US makes. From Tyler Durden writing at Zero Hedge on December 21st, 2011:

It's Official: US Debt-To-GDP Passes 100%
With precisely one year left for the world and all of its inhabitants, at least according to the Mayans, not to mention on the day of the Winter Solstice, it is only fitting that US debt, net of all settlements for all already completed bond auctions, is now at precisely $15,182,756,264,288.80. Why is this relevant? Because the latest annualized US GDP, according to the BEA, was $15,180,900,000.00. Which means that, as of today, total US debt to GDP is 100.012%. Congratulations America: you are now in the triple digit "debt to GDP" club!

(naturally, this is using purely "on the books" data. If one adds the NPV of all US liabilities, and adjusts GDP for such things as today's housing contraction, then the magical triple digit threshold was breached long, long ago).

Back to the Guardian article:

Nerves around Spain's creditworthiness � whose economy is twice the size of that of Greece, Ireland and Portugal combined � had settled somewhat since the depths of the eurozone debt crisis last year. But recent days have brought renewed fears in financial markets and among fellow eurozone members that Spain could be the biggest threat to their future.

The latest downbeat news from the government sent shares falling and bond yields climbing. Spain's main IBEX share index ended 2.7% lower while the spread between Spanish bonds and their German equivalents widened as investor confidence slipped.

The stupidity of tying everyone to a single currency is now becoming all to clear. The weakest denominator will always... ALWAYS drag the strongest down to their level -- it will never go the other way. The unelected masterminds in Brussels have zero clue as to what goes on in the real world -- they are educated at the "best" universities, enter "public service" on graduation and they have never run a business or had to make a payroll. I feel sorry for the Spanish people who are having to tighten their belts after such a long free ride -- this has got to be a major change for them. Spain also dumped billions of Euros down the green energy rathole starting about fifteen years ago and ending about five years ago. Some good lessons to be learned there but will the masterminds ever listen? Nahhhhhh...