about the euro. Spain – Too Big To Bail? Multiple rating agencies already put Portugal, Spain and Greece on future downgrade watch, while Italy is another highly indebted euro member persistently coming up in market chatters. Deutsche Bank AG has pegged Portugal as the next seeking a bailout after Greece and Ireland, while Spain is a hidden debt bomb dubbed as “too big to bail” since the size of Spain’s economy (about $1.4 trillion, with 20% jobless rate) is twice that of Greece, Ireland and Portugal combined. Moody's estimated Spain may have to raise €170 billion from the markets next year, not including the amount banks may need to recapitalize. Bank of England, meanwhile, is not instilling much confidence either by forecasting a possible return to recession in 2011, adding that further quantitative easing may be used, if an "external shock" hits the economy. Expect A Full-on Assault on Euro All this is not to say other EU members are in good financial and fiscal fitness either (See Graph). So, if you think the series of down-grades and rising concerns on euro zone countries' debt has worked against the euro this year, expect a fresh new round of downgrades--over debt or growth prospect—to bring about a full-on assault on Euro next year, particularly when you see Spain come up in headlines.
China, Gold, Euro, Dollar, 2011
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