Are the Protests in Spain a Sign of the Euro's Inevitable Collapse?

UK's The Telegraph posted a video of current on-going riots in Spain. Spanish citizens are protesting “austerity measures” the Spanish government has undertaken to help get its fiscal house in order. The riots in Spain are similar to the events experienced by fellow struggling Eurozone-member countries Ireland and Greece. In order to prevent these nations from abandoning the European currency, billion Euro bailout packages have been given to their governments. In exchange for the bailout packages, the debt-straddled nations have been forced to make deep budget cuts—often slashing spending on welfare and public sector jobs. The Kuwait News Agency reported on Wednesday that European Commission President Jose Manuel Barroso stated that the Euro was not at risk of collapse. “The Euro has been tested over these turbulent months, but it has never been at risk of collapse,” he said. Yet, with civil unrest spreading to another country, it seems likely that speculation of a Euro collapse may continue. In March, on CNBC, Berkshire Hathaway's Warren Buffet called the potential collapse of the Euro “[not] unthinkable.” In December, Daily Mail reported that Britain's independent Treasury watchdog warned that the Euro was at risk of collapsing. So how would the collapse of the Euro affect the United States? Quite severely, says largest economy in the world, it seems intuitive that the collapse of its currency would have far-reaching effects. Traders who want to make a play on the Euro might wish to consider two ETFs: the first is ProShares Ultra Short Euro EUO, the second is Currency Shares Euro Trust FXE. EUO is a short-Euro ETF that may do well in the event of the Euro's collapse. FXE is the opposite, a long-Euro ETF. Traders who believe Barroso is sincere, and that the Euro will remain in place, may wish to consider FXE in the event the Euro becomes oversold. Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.