No one is lending money to Spanish banks, which means that sooner or later Spain has to borrow emergency funds from the newly established European stabilisation fund. Since the Euro will not be devaluated, Spain will have to reduce prices to export and remain solvent. When prices are going down it is called deflation. Spanish people will have to re-learn to work.
Something, maybe the Spanish situation, frightened today TASE investors. It started rising 2% and ended the day plunging 2%. Expletive deleted.