I have a newsflash for U.S. investors: Sweeping Europe's problems under the rug doesn't make them go away.

Just three weeks ago the Spanish government announced that its fourth-largest bank by assets and the largest commercial mortgage lender in Spain, Bankia, formed from seven smaller cajas (Spanish savings banks) and given a 4.5 billion euro loan to aid their combination, would be nationalized.

The reason for the nationalization was simple: Up to half of Spain's commercial real estate loans are either in default or at a high risk of default. Spain's government needed to step in to ensure the orderly maintenance of banking operations in the country. The Bank of Spain initially planned to inject up to 10 billion euros to cover the costs of what it considered to be toxic assets in Bankia's 32 billion euro commercial real estate loan portfolio. I then warned that this figure probably wouldn't even come close to satisfying what would be needed to contain Bankia's problems; how I wish I were wrong.

On Friday, Bankia announced that not only did it need the 4.5 billion euros it was granted during its formation, but it would need an additional 19 billion euros, roughly $24 billion U.S., to curtail defaulting. If this has an AIG-like (NYSE: AIG) feel to it, you'd be correct to think so because AIG also contended that it'd need no more funding only to pilfer from the Federal Reserve and U.S. Treasury time and again a total of $180 billion during the height of the financial crisis in 2008.

The problems at Bankia highlight considerably deeper-rooted problems in Spain.

For one, as reported by The New York Times, some of Spain's regional governments are running out of funds. A few have been able to lend at ridiculously high interest rates over short time spans, but others, like Catalonia, responsible for one-fifth of Spain's economy, have warned it may need the Spanish government to step in and help it pay its debts.

Second, and perhaps scariest, regular cash outflows harken back to the panic days of the 2008 crisis when there was a run on U.S. banks and Lehman Brothers, Merrill Lynch, and Bear Stearns failed to survive the liquidity crisis (at least on their own) due to their highly levered securities portfolios and their reliance on the mortgage-backed securities market. There are few countries out there whose banks' assets total up to such a high percentage of GDP as they do in Spain. Even though Banco Santander (NYSE: STD) and Banco Bilbao Vizcaya Argentaria (NYSE: BBVA) possess smaller levels of commercial real estate loans relative to Bankia, that doesn't mean they are immune from a countrywide run on the banks.

Finally, there's the question of how to get Spain's citizens working again. At 24.4% unemployment, I'm almost ready to consider Spain's situation hopeless. More than half of its young workers are unemployed, wages aren't moving higher, and home prices are still falling. Everything is snowballing in Spain and it's going to come to a head sooner than you think, whether you choose to ignore it or not.

Bankia's $24 billion boo-boo might seem huge, but it's probably just the tip of the iceberg of what's to come in Spain. Germany and France better be prepared to open their wallets very wide if they have any desire in saving the eurozone from catastrophe.

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