This Reuters analysis looks at what comes next in crisis resolution, especially in terms of European debt:
“It took $5 trillion and an unprecedented global coalition of G20 countries to stabilize the economy after investment bank Lehman Brothers collapsed in 2008. Quelling the next phase of the financial crisis may be even harder.
To stop the panic that erupted nearly two years ago, governments transferred a mountain of debt from private to public accounts. Now, those government debts are distressing financial markets and there is nowhere left to shift the burden.
Europe’s clumsy response to Greece’s debt woes highlighted the economic and political headaches that await debt-laden countries and those who finance their borrowing.
European leaders have yet to convince investors that they have a credible short-term plan to contain government deficits and a long-term answer to the region’s slow growth. Until they do, financial markets will remain volatile, and the hard-fought economic recovery is in jeopardy…
Fixing the problem will require money and political will. One cannot work without the other, and both are lacking.
I’ve said before “you cannot borrow your way out of debt anymore than you can drink yourself sober.” The various crisis leaders should keep that in my mind as they take the easy route — throw more and more money at the problems, but fail o make the hard choices when it comes to resolving them.
Next phase of financial crisis may be the hardest
Reuters May 21, 2010
Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.