The Big News Today - Europe Financial Alert (12-1-11)
The big news today is all about Europe. And, it will continue to be Europe in spite of the big market swings that took place this past week after the news that Europe can now borrow U.S. Dollars more easily.
Yes, I said borrow U.S. dollars more easily. As you know, borrowing is never an answer. Europe’s economy is four times larger than the U.S. economy, and if it fails, will produce a crisis much larger than the 2008 crisis. In fact, it will not be a crisis, but a catastrophe!
Italy is now on the edge of needing a financial bail out. The problem is that there are no banks in Europe big enough to bail out Italy. Italy’s debt now stands at $2.8 trillion and continues to rise. You can be sure that the Federal Reserve will eventually step in to stop the collapse of the Euro with printed money.
Johan Van Overtveldt, editor-in-chief of the Belgium business magazine Trends, explained how Italy’s financial problems might put the economic crisis on a new level.
“The countries that have had similar problems before Italy – Greece, Ireland and Portugal – all together present six percent of the Euro GDP. Italy alone presents 17 percent of the Euro GDP. This means Italy on its own is almost three times as big as three smaller countries. And this is quite frightening,” Overtveldt said.
Money is already being poured into Greece, Portugal, and Ireland, but Overtveldt says Italy’s case will be much more difficult. Throwing money at a problem—whether it’s Greece, Portugal, Ireland, or Italy—isn’t enough. “The main question is what the attitude of Germany and the other countries will be. No one knows whether Germany, Holland, Finland, and a few other countries are prepared to put up money or to put up guarantees so that the stabilization fund can raise money. That would be a very tough issue for the whole of the EU,” maintained Overtveldt.
We are living in precarious times. As believers, we’re not to be afraid or let fear rule our hearts. But, Jesus said that a wise man knows how to read the seasons. So be cautious this Christmas with your spending. As I’ve said for more than 25 years, get out of debt and stay out! Live within your means and live with a grateful heart. Lust will never be satisfied. There will always be a better car or a better house that beckons your attention, and God is good! He will bless you with good things if you will serve him and live your financial life as his Word teaches. Learning how the Kingdom works is essential for the days ahead.
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