USA Provides Sugar rush to Europe’s Wobbly Banks
The U.S. Federal Reserve provided an early holiday gift to Europe’s wobbly banks. The sugar rush loan from the Fed stabilized dizzy markets and helped a global stock market surge which happily jumped 500 points in the last day of November.
Still the stabilization loans from six Central Banks can treat the symptoms but not solve the problems.
Paying the piper for Euroland’s profligate social spending will take more than largesse from Uncle Sam across the Atlantic. Massive government spending to sustain an Entitlement State (is welfare state too crude??) will continue to draw down the financial fortunes of Europe. The problem goes well beyond the Greeks. Some big names which come to mind include Italy and Spain. And let’s face it, France and Germany can’t pay all the bills.
And for that matter neither can the USA who is equally saddled with spiraling spending and an albatross of debt which has nearly quadrupled in the past three years.
After a pretty dreary economic autumn, it’s nice to see good economic news, at least for a day. Yet, sadly solving the Eurozone crisis will take much more than an early Christmas gift from the Fed.
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