Spain facing threat of EU bailout

The yields on Spanish bonds on Wednesday rose to their highest level since the introduction of the euro. Many fear that the EU will now intervene. Ignacio Escolar explains in his blog why seeking help from the bailout fund should be the last resort: "The problem is that such a bailout would entail the kind of harsh conditions under which Greece, Ireland and Portugal are now suffering. A bailout means that the creditors make the political decisions. And the prime interest of the creditor is to recover his money, not to guarantee the future of the country's economy or the well-being of its population. This is why the bailout is the last resort. … In the best case the Rajoy government will try to hold out until July 1 until the European Stability Mechanism (ESM) takes effect. If a bailout should be necessary, the conditions would be better than under the EFSF fund."

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