It’s no wonder that the recent financial crisis started in Greece, moved to Spain and Italy, and now threatens to engulf America as well. Riots of taxi cab drivers in Greece are broadcast everywhere. It was thus in 1916 when the Balkans provided the shot heard round the world with the assassination of Arch Duke Franz Ferdinand and his wife.
New strains on Spanisn and Italian bonds have caused investors to flee to safe havens: U.S. treasuries, German bunds, and U.K. gilts which just sold at their record low yield in history. The U.S. and Germany just reached a record since last November. The U.S. stock market fell for the eighth straight day, the first time since 2008.
What does this portend? Already predictions are out that Italy won’t be able to sell its bonds in September. Jokes are circulating that the EU lawmakers did only enough to get them through their August recess.
The euro crisis has at least the power to put the U.S. into another recession — and possibly much more.