Spain: outside?

Not now. Probably, in 4 or 5 years. Let´s face some facts:

- If ECB doesn't intervene, Spanish new bonds are difficult to sell.
- The way this intervention is held tells us about the EU´s intentions. The ECB gives money to Spanish banks (to repay it in 3 years) and forces them to buy national debt. This is the firewall: 3 years to have most of the Spanish debt in Spanish hands.
- Spanish public debt sales by foreign investors (53B EUR since November) have been offset by domestic banks and local entities (71B EUR).
- Neither the state´s nor private balance sheets have improved after the banks buying.
- Companies go bankrupt for not having immediate cash flow. Countries are the same. Are they shooting in the right direction?

Spain is a great country to live and invest. Spaniards are as serious as anyone else in Europe or US. They just need to lower the prices of everything to become competitive again. This could be done within the euro or outside. In the past, Spain had 3 years of constant currency devaluation, and that worked fine. If it is within the euro, it will mean deflation, low wages, more unemployment, paralysis for the economy, educated Spaniards moving abroad... If it´s outside, there will have some discount on national bonds, in 3 years in local hands in a good percentage, inner debts and assets will be valued in the new currency after this process (click to read Mauldin´s view), and more economic activity.

To change the Spanish economic structure may sound lovely, but it´s almost impossible to achieve. Their main assets are sunny days, beaches, good healthcare (politicians, careful here, don´t overcut), food, happiness... Spain was and will still be the Florida of Europe.