European Economies Are Falling

In Portugal, Ireland, Italy, Greece and Spain, their economies have been under fire for over two years and they are growing worse, as each nation compelled by its lenders, is forced to slash its overhead. As they do, increasing numbers of people are being thrown out of work, in unemployment areas that already exceed 20% (during the Great Depression of the 1930's, the U.S. unemployment hit bottom at 25%). Now those economic problems are beginning to spread to more prosper nations such as Germany, Austria and the Netherlands.

Investors across the globe have expressed their relief that Greece is getting bailed out again, but in the end, all this does is to postpone the inevitable. Greece, with a sharply falling economy is being overloaded with more debt. How bad is the situation? For now, the European Central Bank won't accept Greek bonds as collateral, a clear indication of their lack of confidence in Greece's finances.

Politicians, as they often do, try to postpone a day of reckoning during their watch by doing anything they can such as loaning money to nations that can't afford it. In the face of this uncertainty, please continue to carefully manage your household spending, slash your personal overhead if possible and prudently manage your job. Eventually, the world economic structure will be rebuilt on a solid foundation but not now.

Dick
To learn more, please see "Europe Bank Forecasts Economy to Shrink," The Wall Street Journal http://online.wsj.com/article/SB10001424052970204603004577269090245209000.html