According to Dealbook it felt eerily familiar: Stocks are plummeting. The economy is slowing. Politicians are scrambling to find solutions but are mired in disagreement. No surprise that many Americans are wondering whether they are in for a repeat of the financial crisis of 2008.
The answer is a matter of fierce debate among economists and market experts. Many say the risks are lower today — at least in terms of an immediate crisis — because the financial system over all is healthier and there are fewer hidden problems. But the experts add that there are reasons to worry, and they do not rule out a quick downward spiral if politicians in the United States and in Europe cannot calm investors by addressing fundamental financial threats.
The core problem, as it was three years ago, is too much debt that borrowers are having a hard time repaying — but this time it is government debt here and in Europe rather than consumer debt. So far it’s not as bad as 2008, but it could get much worse…
Read more at http://www.nytimes.com/2011/08/11/business/financial-turmoil-evokes-comparison-to-2008-crisis.html?_r=1&ref=business&nl=business&emc=dlbka23
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