Government spending causing European debt crisis

NY Times:

With Greece inching closer to the brink of financial collapse, fear that the debt crisis will spread rattled global markets for a second day on Wednesday as investors awaited a signal from financial leaders gathering in Berlin.

Shares slumped 1 to 2 percent across much of Europe and Asia, and the euro briefly fell to its lowest level in about a year against the dollar, as investors worried that Portugal, Spain and even Ireland might not be able to borrow the billions of dollars they need to finance their government spending.

Market sentiment began to steady in afternoon trading in Europe, with the FTSE 100 index in London turning positive.

Stocks in the United States were expected to open higher, based on early gains in stock index futures prices. Sentiment was lifted by better-than-expected quarterly results from a wide array of companies, including Comcast, Corning, Northrop Grumman and Dow Chemical, The Associated Press reported.

Investors have grown increasingly nervous about the fate of Greece and other economies that use the euro. A recent proposal by European governments to extend a 45 billion euro loan to help Greece pay its bills, together with a smaller pledge by the International Monetary Fund, has done little to calm the markets. Germany’s statement this week that it must first see more deficit reduction from Greece before fulfilling its pledge has only increased concerns that Europe is not united behind Greece.

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It is too bad that the Europeans did not have a Tea Party movement before their debt expanded beyond their ability to service it. It is also too bad that liberals in this country still don't comprehend what the Tea Party is about. They see protesters against spending and debt as a sign of racist, bigoted homophobes. These people in the Tea Party movement may be against the evils of liberalism, but their main focus is on the exploding debt that Obama and the Democrats are foisting on the next generations.

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