Thursday, June 21, 2012

Weird’s Deep Thoughts (Thursday Afternoon Edition): Why America Won't Let the EU Fail

Sure, they say "no" now, but Obama, Bernanke (and even Romney) would do what they could to fund a euro bailout.

According to Kiplinger if Europe is threatened with a dire financial crisis, the United States will rush in with a helping hand, despite the insistence of President Obama and other U.S. leaders that taxpayer money would not be committed for this purpose. Europe would have to shoulder the heaviest load, but if those efforts proved inadequate, there is no doubt the U.S. would join. That’s because a collapse of Europe’s financial system would probably cause a worldwide economic downturn and plunge the U.S. into a deep recession.
The aid, if needed, would flow mainly through the Federal Reserve, which has ample authority to lend trillions of dollars to such a rescue. Further assistance could include effective commitments from the U.S. Treasury through multilateral lenders such as the International Monetary Fund.
Politics lies behind the official denials from Obama and Federal Reserve Chairman Ben Bernanke. Conservatives have been harshly critical of debt piled up by the Treasury and the Fed since late 2008, even though most economists say this spending and lending was needed to avert a U.S. depression. And the general public is both worried about government debt and suspicious of the Fed lending to foreigners…..

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