Nation Deficits Threaten World Economy. Should We Worry?

Geena Davis had a great quote in the movie, "The Fly," which was "Be afraid, Be very afraid." That statement sums it up pretty good right about now. Either rampant imcompetnce or pure evil is driving us to an inevitable end, but the end is coming and there's nothing anyone can do to stop it at this point.

First off, Greece is going to default on the debt. Their plans to fix things by taxing the crap out of the middle class and poor people is stunning in it's idiocy. The average salary in Greece is 20,000 Euros or about 28,000 dollars. They plan to take away an additional 800 euros a month or about 1200 dollars. That's a lot of money to sacrifice when you're already just getting by. The measure has little chance of passage as what they should have done was crack down on the banks and lenders that caused the problem in the first place. Instead they went after the "little people," who rioted in the street. What will happen when they default, which almost everyone agrees is going to occur? Most of the news will be bad.

The stock market sunk today, here and abroad, on the realization that default on Greece debt is inevitable. Here are a few of the things that are likely to occur, some good, some bad.

1. Your safest investments could be at risk
Even "plain-vanilla investment accounts in the U.S. could be challenged if Greece defaults on its sovereign debt," says John Carney at The Christian Science Monitor. That's because U.S. money market funds have lent $360 billion to European banks that have, in turn, made massive loans to Greece. About 12 percent of the money in those U.S. funds is tied up in loans to the French banks — Crédit Agricole, BNP Paribas, and Société Générale — who are Greece's main lenders.

2. Mortgage rates could sink
Investors nervous about putting their money into European banks are looking for safe places to put their funds, and one of the safest is U.S. Treasury bonds," says Liz Freeman at ShopRate. As demand rises, the government can get people to snap up the bonds at lower and lower interest rates, and that "should help drive down the rates on mortgages" in the U.S.

3. More Americans may lose jobs
If Greece can't pass the austerity measures, which slash government jobs and benefits, it won't get more foreign aid, and it will default on its $165 billion debt this summer. That would scare investors from buying government bonds from other European countries, sparking crises in other debt-laden countries, such as Ireland and Portugal, and then even pushing bigger economies, such as Spain and Italy, to the brink.

If part three comes to pass, the world economy goes bust and it'll be 2008 redux, only this time I expect much much worse. Why? Because our economy is about to go bust like Greece. If that happens, expect major problems on a Biblical scale.

Today, Eric Cantor walked out of talks about raising the debt ceiling as the democrats wisely said unless the tax cuts for rich people expire, there will be no deal. Republicans have said they will never agree to tax hikes, this the impasse. If Greece defaults, were rocked. If WE default, we're F#$CKED!!!! The clock is ticking and see my previous post on what will happen if don't raise the debt ceiling. It will make your hair stand straight up and probably fall out. The Republicans are playing chicken to protect rich people and corporations. Their ideas are very similar to the most unpopular parts of the Greece austerity plan. Why aren't more people pissed about that?

It may not matter one way or another as everything right now points to Armageddon in one way or another. Don't believe me. There is so much weird stuff going on right now, I hardly have time to write about it. Upcoming articles I hope to focus on are the UN's Agenda 21 which may or may not be a plan to depopulate the earth, the sun spot activity going up or down depending on who you read, the sea levels rising/falling, and more. Everything has two sides lately, even when they don't. Some people are spreading a lot of misinformation. The purpose of this site is to get to the truth. Either way, be prepared by mid-July to start seeing a massive stock sell off again. If you listened to me during the last crisis, you would have sold high and bought low, doubling your money. Opportunity will come again and soon. Why not make some money before it doesn't matter anymore?