The situation could be even more severe in Spain, which in recent years has been a star of economic growth and job creation among the 13 European Union countries who have adopted the common currency euro. But much of that growth was fueled by a consumer spending boom and a housing market where values have more than doubled in the past seven years.

An estimated 98 percent of Spanish home loans are adjustable-rate loans, and nervous Spanish banks have tightened credit and raised rates so quickly that Prime Minister Jose Luis Rodriguez Zapatero virtually begged national lenders not to retract too quickly and send the economy into a tailspin.

The International Monetary Fund recently cut its 2008 growth estimate for Spain from 3.4 percent to 2.7 percent, and many private economists think even that is too optimistic.