News Summary: Europe fears spread of Spain's pain

AP News
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Posted: Jun 07, 2012 6:13 PM
News Summary: Europe fears spread of Spain's pain

THE FEAR: Politicians and investors around Europe are worried that Spain won't be able to cover the toxic real estate loans weighing on its banks, and they expect Spain to seek an international bailout to bolster its lenders.

THE SPIRAL: Those concerns have sent Spain's borrowing costs close to levels where most market-watchers say a country cannot afford to keep servicing its debt. Estimates of the bailout Spain may need have more than tripled.

THE RATING: Fitch Ratings on Thursday downgraded the country to BBB, two notches above junk, and warned that it faces further downgrades.