Financial analysts say Spain has not reached the crisis level of Greece yet, but troubled times in Madrid are far from over.
Prime Minister Mariano Rajoy has already said Spain will miss financial targets it agreed to reach with the European Commission, The New York Times reported Friday.
Rajoy said Spain can bring its deficit down to 5.8 percent of the country's gross domestic product this year. The agreed upon target was 4.4 percent.
Meanwhile, Rajoy is assembling a budget that relies on a prediction that the economy will shrink 1.7 percent in 2012.
Recently, however, Citigroup said the Spanish economy will contract 2.7 percent this year and 1.2 percent in 2013.
The unemployment rate is nearly 25 percent as 5.3 million workers cannot find a job. There were 1.6 million Spanish families in 2011 that went through the entire year without any household member holding down an official job, the Times said.
Basically, "The math does not work," said economic analyst Jonathan Tepper of Variant Perception.
"Spain will eventually need a rescue of some kind," he said.
While personal economic troubles abound, the government must also remain solvent. The cost of government borrowing -- as measured by yields on 10-year bonds -- jumped from 4.9 percent in early March to 5.5 percent Friday.
Spain's banks are being kept alive with cheap loans by the European Central Bank, which makes lending possible. But some worry that program will cannot go on forever.
"They are using the banks to artificially fix the sovereign. The banks are doing this to be patriotic and because they have nothing to lose. But what happens in the second half of this year when the ECB stops lending at low rates?" Inigo Vega, a banking analyst at Credit Agricole Cheuvreux told the Times.