More than likely we will see at least a little stabilization within the Euro zone. The question is how much. I am particularly worried about their inhability to cut in "sacred cow" areas, just like the US. However, in my opinion, it isn't as much about cutting budgets as it is increasing GDP through productivity (which would increase government revenues). Even in high tax countries like in Scandanavia, the business environment continues to be the catalyst for economic prosperity.

John McCoy Replied on Jan. 17, 2012

Is easing one of the sacred cows you're referring to? After all of the dust settles and the smoke clears, I think easing and the so-called "austerity measures" have the same basic effect. Do you believe the public outcry would have been as intense over induced inflation?

Nathan Och Replied on Jan. 18, 2012

You are right John, they probably would have the same effect in the long-run. Just a different means to an end. I do not believe the public outcry would have been so "loud" with induced inflation. Austerity measures tend to have a stigma that attack the citizens and "makes them pay" for a bloated government that may have overreached. Induced inflation is quieter approach in which citizens may actually have raised optimism assuming wages rise with the inflating prices. If not, people will protest raising prices and, in a sense, falling wages.

John McCoy

Solutions Architect, Perceptive Software

Posted on Jan. 17, 2012

The more time goes by, the harder I think it is to remain optimistic, I recently read a report that explained how this crisis has been labeled and treated as a liquidity problem to date when in fact it is a solvency problem. In light of this analysis, we can see why infusions didin't fix anything and throwing more money at it only makes the landing harder Stacking on the civil and political factors I can't see the happy ending, but I'm still looking...