Can Spain Avoid Greece's Vicious Circle?

Spain (Photo credit: NASA Goddard Photo and Video)

 Spain is at risk from many of the problems which beset Greece in the run up to its bailout by international lenders. “What they’re going through seems like the Greece situation a couple of years ago, and there are concerns that if it’s not addressed soon enough, it could move further to the same vicious cycle,” Thanos Papasavvas, strategist at Investec Asset Management, told CNBC Europe’s “Squawk Box” Wednesday.

The country’s economy is in recession, confirmed by the latest second quarter GDP (CNBC Explains) figures released on Tuesday, which showed the country’s economy contracted for the third quarter in a row, and by 1.3 percent from the same time in 2011. Deposit flight is an increasing problem for the country’s already struggling banks as deposits fell by 4.7 percent from June to July. (Read More: Spain's Recession Deepens)

Youth unemployment is now over 50 percent – although this probably conceals some people who are being paid off the books.

In Spain’s favor are a “credible austerity plan” and “some progress on structural reforms, particularly in the labor market,” according to Papasavvas.... Continue to read.

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• The Greek crisis: an economic problem, not a moral quandary (ekathimerini.com)
• Chart Of The Day: For Spain, The Real Pain May Be Just Beginning (sgtreport.com)