The problem for Spain and for other struggling eurozone economies is that even with falling yields on their government bonds, their economic growth rates are too low to allow them to reduce their debt ratios.
As Paul de Grauwe, an economist at the London School of Economics, recently explained in a research note, despite all efforts to reform their economies and cut government spending, even those eurozone economies often seen as the most committed reformers are unable to stop their public debt ratios from spiralling out of control.
In the absence of such a crisis, the eurozone will remain what it is today: an economic area characterised by low growth, high unemployment, and increasing debt levels.
The truth is that the eurozone has become a disaster zone, unable to generate the kind of growth rates required to keep debt levels manageable.
Read more here: Business Spectator