Here in Spain the biggest problem has been the three years that the real debt has been kept hidden under the carpet. The previous socialist government expected that the general recovery would help to exit the crisis and then be able to clean all the mess with out to much light from the international markets. Meanwhile they said that they were making a "social" exit of the crisis. That means increasing the spenditure, a bad idea when what you have is a mad excess of public wasting. Very little has been spent in R&D or other meaningfull spendings, just new rich projects and "me too" business plans.

The problem is that nobody really knew ( maybe they didn't want to know) how big the hole really was: municipal debt (the bigest debtors to private companies in Spain, are city Halls), public banks (cajas) unrecoverable credits (huge lendigs to political friends for building proyects), crazy public spending ( huge airports,high speed railroad between small towns..).
Mind you that all this has been caused by every political party, government agency, local government, private companies( mostly construction ones) and banks( friends of mine bank office directors were regularly yelled by their bosses to increase lending no mater who). Of course a gold rush of cheap credit infected the whole population. A perfect storm if ever have been one in the spanish economy.

Finally this government is taking the rudder of all this madness , and making real changes relatively fast: new transparency law for public agencies(there was none, all the accounting was almost secret!), plan for paying all the municipal debt to small companies (this finally has made public all hidden cities debt, and will avoid that lots of small companies go bankrupt), new banking and financial markets law (to increase the transparency and safety levels), public spending cuts (pretty heavy ones), another law to take control of regions that are not taking measures and making the needed cuts in spending.

I think that we are at the worst of it but only because all the truth (well maybe only the biggest part) is coming in to the light. I also think that we will go through this as real measures are being taken, in Greece they have the problem that there is no strong government taking this kind of measures.

Also a real deflation is taking place, in salaries and prices( as we can not devaluate due to the euro), this is quite traumatic for the people as you see how bussiness are cuting your pay slowly every year. But as prices were artificially inflated due to the euro ( germany used to be expensive in the nineties, now lots of things are cheaper there!), and the competitiveness of Spain sank, we only created wealth via credit. Maybe this deflation will increase our export rate slowly.

Somebody commented if it would be a good oportunity to start a bussiness or a shop here. Nothing that is related to sales is a good idea, as there is no cash around to buy anything. But it is a good time for hiring people with high qualification at a discount ( programers , biologist, architects, physicists, lawyers, ingeniers, doctors) for little more than 1000€/month, even with 1000€ you'll have peolple lining up for the Job.

Also it is a good time to buy spanish companies (we have some good ones too) with big discounts due to market undervaluation and their need for money (banks are not lending AT ALL!).

Edit: typos and general editing as I wrote it from the Iphone.