The economic crisis that struck Europe in year 2008 has left deep scars in the economic system and is today still a thriving matter for the politics all over Europe. Spain is the second biggest economy in the euro zone and is one of the countries that have handled this crisis in a very poor manner. The purpose of this essay will be to investigate why Spain with all their resources has been led to the deep crisis they are in today. To see this, the research will take a closer look upon the decisions that has been made and those who could have been made to resolve/ lessen the effects of this crisis. There are multiple ways for a government to handle a financial crisis with different effects and results. Some of these choices are being brought up in this research, e.g. bailout, which is when a government saves a dying company (mostly banks) from bankruptcy, this measure will have both advantages and disadvantages for the country. This in form of trust issues and to give companies an attitude that failure is an option. The government in Spain could have used these measures in a more advantageous manner, if they would have done that Spain wouldn’t be in the situation they are today. In the later years the government has done correct measures the problem is that it happened 3-4 years too late. The government especially should have tried to suppress the massive housing bubble that was growing in a rapidly in the country.