News Summary: Spain bank bailout relief fleeting
News Summary: Market relief short-lived as worries arise in wake of Spanish bank bailout plan
A woman begs in the street at Sol square, in Madrid Sunday, June 10, 2012. The sign reads: "I suffer from diabetes, and heart failure. I have no family, I have no more help than your donations. Oh God, I ask to help me with food or money. Thanks." Spain became the fourth and largest country to ask Europe to rescue its failing banks, a bailout of up to 100 billion euros ($125 billion) that leaders hoped would stabilize a financial crisis that threatens to break apart the 17-country eurozone. (AP Photo/Daniel Ochoa de Olza)
·Associated PressFLEETING COMFORT: Financial markets' enthusiasm for a €100 billion ($124.68 billion) plan to rescue Spain's banks quickly cooled as investors questioned the conditions of the loan package and worried that the country will need more help.
THE REACTION: Stock prices of Spanish banks soared and the Spanish government's borrowing costs sank Monday morning. But the gains eroded by the end of the day, reflecting skepticism that the financial lifeline would do much good.
THE BACKGROUND: The euro region's fourth-largest economy is in its third year of recession, unemployment is soaring and the rescue loans for Spain's banks will add to the country's debt. Investors fear the new debt will dangerously strain Spain's ability to make interest payments.
