Will the Catalonia protest- march affect the future of Spain?

The latest financial news is that the early hopes of the euro zone of avoiding a short term financial crisis after the European Central Bank’s latest action seem to be on the verge of dashing out, as the Spanish debt continues climbing higher and higher and the problems assailing the euro zone keep worsening. This is certainly a setback for those investors that had begun to lay large bets on the belief that the European Union and the Euro were back on the road to survival.

The internal issues that are maiming Spain are indeed very colossal; resultantly, the fear of the financial crisis deepening even further is a very alarming thought. The magnitude of fear in the minds of the people can be revealed from the news that along with the political parties, the citizens of Catalonia, Spain, have begun exploring means to legally separate from the country and gain control over their revenue; Catalonia being an overall net contributor to the country. Tension is prevailing here as the rate of unemployment is very high and the financial situation is getting out of control. Thus, the local politicians are taking advantage of the weaknesses of the hapless central government and trying to separate from Spain.

The people in the region of Catalonia are march-protesting against the Madrid government for want of independence and sovereignty. November 25, 2012 has been the date fixed by the regional government as election-day. As a continent, the countries of the euro zone have been unable to stay in unison and now it is evident that the individual members too are not able to come to an agreement on how to manage their own nations. Through this election, the future of Spain and the administration of its assets and taxes will be decided. After all, what is the financial crisis of the euro zone? It is nothing but the amalgamation of the different people and the countries under a single economic union; where troubled areas of a part of the euro zone are to be helped by using the funds of another area, during their times of financial crisis. So is it any wonder then that Germany is not in agreement with the bailing out of the fellow-country men of Spain as the latter country itself has not exhibited any inclination to do the same? When the solution lies in the unity of the euro zone countries, if there is no love lost amongst the said countries; if they do not have great integration rapport, the chances that euro zone countries will keep together is quite remote.

In fact, there is great danger ahead for the financial crisis in the long term, even if the latest bailouts can prevent the immediate economic crunch!

Article by Critical Warning Number Six by Michael Lombardi.

Michael Lombardi, who writes for Profit Confidential, has authored and published over one thousand articles on investment and money management. He is an astute stock picker and also an active investor in real estate, art, precious metals and various businesses.

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