Well, the United States economy seems to be picking up. The stock market is up and the job situation is slowly becoming manageable. Even the car companies like Chrysler are doing well and paying their loans back. However, there is a debt crisis going on in Europe now that is stirring up riots similar to what we saw everywhere happening in the Middle East. A recession is also sweeping across the continent.
It is similar to the financial crises that leveled us in 2008 except in Europe, it is not only the banks that are in danger of collapse but entire countries. You would think that there are only few things that can really change your lives. Greece has already defaulted on more than $100 Billion dollars of public debt. The numbers are so large it is too difficult to even reasonably think of a way to pay back.
Why should we care about Europe’s economic problems? Well, one very important reason is that Europe is America’s largest trading partner. We import and export more goods and services to Europe than any other region. The European Union has all the characteristics as one nation might have with all its various states only it involves various countries with all its various customs, languages and traditions.
Until recently their monetary union had brought stability and prosperity to the continent’s social democracys. Yes, for a change in history Europe is not at war with Europe. The Union also brought good wages, generous benefits and long vacations to the people because they protest and they receive. The European holiday is nice but doesn’t produce more money for the countries.
Louise Cooper, a top financial analyist in London says the European holiday is over. The Europeans are in a debt crisis. The people there are living beyond their means much like the Americans did when we all had 6 to 10 credit cards and managed to max out all of them. After 10 years of booming economic times, we are all paying back our credit cards and it is proving to be very painful for the consumer and very profitable for the credit card companies.
Seven European countries have changed leadership because of the crisis and one country, Greece , defaulted on a 133 Billion Dollar debt. This is an extraordinary event in history. A member of one of the most important countries in the Euro Alliance can’t pay its bills. A Western developed country has defaulted. We haven’t seen that since 1940 when Italy did it in the second World War when it refused to pay its enemies.
The European Finance minister is worried that the same fate will happen to Ireland, Portugal, Spin and Italy which are already in crisis and are loosing the confidence of international investors who bankroll their debts. So, where do you want to go on vacation? I think I’ll stay home.