The Spanish have retaliated, with the Spanish Treasury releasing a statement claiming that the S&P verdict "underestimates the scope of the unprecedented structural reforms undertaken, which will obviously take time to bear fruit."
Not prepared to wait
But hanging around for financial reforms to take root won't interest the markets. They're looking at Spain's health now. Spain's 10-year government bonds are widening. Though the yields are some way below the 6.2% seen in late summer, it's indicative of bail-out nerves.
Much of the spending in Spain's more autonomous areas remains opaque; there is no shortage of unreliable figures being bandied around, and there are no shortage of autonomous regions: 17 in all, plus hundreds of municipalities, which represents an awful lot of public spending. Perhaps it's best not to dwell too much on this fact.
Holding onProperty sales - the backbone of much of Spain's economy - still remain frail, despite a recent tax cut on new-build properties. Sales have plummeted 50% in the last five years. When credit conditions were easier, Spain was building 650,000 new homes a year. Last year the figure was just over 60,000. A huge overhang - and a buyer's market consequently.
Something will be done. Something has to be done. They're the only words the markets are really hanging onto currently. It's not much of a lifeboat, for Spain, or any Club Med member currently. There's also considerable Spanish political uncertainty; its socialist government will be hard hit in next month's elections.