(1) The government in Madrid expects the economy to shrink by 1.7% in 2012 – its third contraction in four years.
(2) Unemployment continues to rise. It is now more than 23%, and youth unemployment is above a staggering 50%.
(3) Housing prices are down 22% from their peak, and are likely to continue to drop, perhaps by 20% or more. This puts extreme pressure on the balance sheets of an already shaky banking sector." (Time)
Spain has structural problems, or the kinds of problems that take a long time to get yourself out of. Spain has gone through a lot before but this is the kind of crisis that challenges your democratic institutions. We could see a lot of young Spaniards get disillusioned with democracy and fall prey to extreme slogans from both the left & right.
Last, but not least, Spain is the 4th largest European economy. This is not Greece. This is much bigger than Greece.