The Obama Campaign 2012 theme might easily be: Things could be worse. We could be Spain.
On Friday Spain released their latest unemployment numbers. Spain's unemployment rate is now 24.4%. Ouch! That's worse than the U.S. unemployment rate at the height of The Great Depression, which was estimated to be between 20% and 21%.
[...] The number of unemployed people reached 5,639,500 at the end of March, with the unemployment rate hitting 24.4%, the national statistics agency said.
Earlier this week, the Bank of Spain said the economy contracted by 0.4% in first three months of this year, after shrinking by 0.3% in the final quarter of last year. [...]
That means Spain has slipped back into a double dip recession.
[...] The country has the highest unemployment rate in the European Union and it is expected to rise further this year. The rate has risen sharply since April 2007, when it stood at 7.9%.
"The figures are terrible for everyone and terrible for the government... Spain is in a crisis of huge proportions," Foreign Minister Jose Manuel Garcia-Margallo said. [...]
The problem with Spain, as troublesome as it is, only reflects a greater European Union problem among its members. Sovereign debt among the PIGS (Portugal, Italy, Greece and Spain) is so great as to pose a collapse of these nation's economies and the snowballing effect it would undoubtedly have upon the possible dissolution of the European Union as an economic unit.
European economic crisis's will have some effect on the U.S. economy as trade diminishes. An odd paradox could also arise. As European countries have their bond ratings move closer to junk bond status, this could see movement of Euro's seeking a safer home in U.S. equities, which means the U.S. markets could see a boost. The NYSE could see the Dow bump up against 13,500 or somewhat higher by the end of 2012.