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  • Big Troubles for the Euro [View article]
    CLH,
    Europe has far less debt than the US by any measure - including as proportion of GDP. That's part of the reason why the Euro grew in price so much this decade as the US national debt ballooned due to the wars. High debt = weak currency. The current correction makes it about even with this time last year - about 40% over 2000 levels.

    Talin,
    At times like these, I don't think we can lecture anybody about their lack of "capitalistic mentaility." We just nationalized Freddie, Fannie, and AIG and provided taxpayer funds for several other bank mergers. The conservative central planners in the Bush administration's treasury department are no doubt the envy of Hugo Chavez.

    Also, with the exception of Great Britain, Europe never experienced the real estate spree of California, Nevada, Arizona, and Florida circa 2005. The bad debts on their books are mostly American mortgage backed securities, so we can assess the extent of the problem by identifying how much of their assets are in these investments. We should have learned by now that the quality of the investments matter a lot more than leverage. Unfortunately, this article offers no such analysis.
    Oct 07 13:38 pm |Rating: 0 -1
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