While many people feel that America's financial situation worsens by the day, America is not the only nation facing economical turmoil. American jobs may be few in number and American car manufacturers may have faced fiscal destruction, but the European Union is facing similar issues. Recently, Ireland was provided with an economical bailout package totaling somewhere between 80 and 90 billion Euros. Many skeptics believed that this would end a long and brutal financial war between Ireland's real estate and banking sectors. It seems that this was just the beginning of what would become the European financial crisis.
Currently, Europe is struggling to reassure investors that they have the liquidity and financial assets to combat and solve these monetary issues. However, European debt continues to rise, which only places stress on their governments and banks. The Euro is also decreasing in value compared to the dollar. These past three months showed a constant decrease is the value of the Euro, which has taken a tole on European trade. This drastic economic downturn has resulted in the European Commission proposing a possible resolution that entails holders of senior bank debt taking the hit if a bank was to fail.
The European debt crisis has reached a point where Ireland and Greece are using 80% of their export revenue to cover their external debt. America is not alone but something needs to be done. It has been said that these issues have progressed to their current state because nations have failed to solve these issues when they were first addressed.
What do you think should be done? Should the World Bank and the International Monetary Fund intervene and help developed powers?
For further discussion, please read the following article from the New York Times:
http://www.nytimes.com/2011/01/08/business/global/08euro.html?ref=business
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