Wednesday, June 30, 2010

The Scream.

If you thought the G-20 Summit in Toronto was depressing, you're not alone. Walter Mead's recap is worth reading in full, but the gist is this:

If this were just Europe’s problem, the rest of the world could commiserate or gloat depending on its state of mind. But economically speaking, we live in adjoining row houses. The fire in Europe’s basement will burn us all out of house and home if it isn’t put out. Without a healthy European economy it is hard to see the world returning to an era of stable growth anytime soon. President Obama’s plan to double US exports has always been a long shot and one suspects that the White House now wishes that a target this ambitious and this public had never been set. A prolonged slowdown in Europe puts that goal totally out of reach and could even derail the US economic recovery — if the latest fall in consumer confidence doesn’t accomplish that on its own. A full blown European banking crisis would almost certainly plunge us back into the deepest depths of recession.