The NYT reports on the difficulties that Spain is facing in the wake of the collapse of its housing bubble. Its unemployment rate has crossed 20 percent and is likely to head higher. Its budget deficit exceeds 8 percent of GDP and its credit rating has recently been downgraded by Standard & Poor's.

It would have been worth noting that the credit rating agencies and the speculators who now believe that Spain is facing severe financial stress thought that Spain's economy was in solid shape as its housing bubble was growing ever more out of line with fundamentals. It is also would have been worth mentioning that Spain was running budget surpluses prior to the collapse of its housing bubble. At the time, it was often held up as a success story by the people now criticizing its institutional structure.