Boy things are really getting interesting. With that massive EU bailout being announced last week and the markets rebounding, then not. Ireland and Portugal begin raising taxes and cutting public servant wages… on and on we go. Here is an interesting article from MarketWatch.com.
The financial crisis never really went away. The debt mountain that brought down some of the world’s biggest banks and dragged the international financial system to the brink of disaster has simply shifted to governments. Now it’s threatening countries around the globe — and, if left unchecked, could rip the very fabric of Europe’s economic system and wreck economic recoveries in the U.S., China and Latin America.
The impact on markets has been severe. The euro has slumped more than 12% against the dollar since the sovereign-debt crisis flared in southern Europe. Gold has marched to new highs as investors seek a safe haven and, perhaps most alarming, it is now more expensive to buy insurance against national default than it is to insure against corporate failure.
– Alistair Barr, MarketWatch
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