News Flash Europe! France and Greece have collectively lost their minds or what little they had left to think with.
With the elections in France and Greece having just concluded, these two countries, through democratic elections, have chosen to return to spend, tax and borrow their way into fiscal and financial oblivion.
Both countries have rejected proposed austerity programs that would have helped alleviate their inevitable fiscal apocalypse looming before them. Although the austerity plans that had been put in place or were proposed, it should be noted that neither of these conditions would have solved their problems. But, it would have given each country further time and space to work their way through their endemic fiscal disasters accumulated over decades of socialist government policies of taxing, borrowing and spending on unsustainable social entitlement programs.
France and Greece, through the entitlement mentality of the voters, have chosen to engage in further programs of self fulfilling disaster. Perhaps they need to engage in war against Germany and then immediately surrender to the German economic engine that is their only hope for economic survival. France already has an advantage in that regard, as they have a history or surrendering at the drop of spilled wine.
[...] The question remains whether Germany - which is Europe's economic powerhouse driving the austerity agenda - will allow at least some countries in the eurozone to spend more freely in the face of a recession that is spreading across the continent. [...]
Considering that Germany is the essential banker to the French and Greeks, it should be very interesting to see what Germany, under the austere conservative leadership of Angela Merkel, will do in the face of this fiscal suicide attempt by France and Germany.
[...] Rising uncertainty over how Europe's handling of the debt crisis may change in the weeks and months ahead has made investors nervous. Stock markets were volatile on Monday, falling sharply in the morning and recovering in some countries by the close.
The sharpest selloff was in Greece, where the main stock index plunged almost 7 percent. The euro briefly spiraled to a three-month low against the dollar, hitting $1.2972. [...]
Because of France and Greece taking a giant step backward in trying to handle their unsustainable practice of borrowing, taxing and spending to fund outrageous social programs, the inevitable result will be to bring about a recession in Europe. If recession were only contained to France and Greece, Europe might be able to muddle through it. But, with the global economy, recession in France and Greece will affect the rest of the world and that may be what France and Greece are counting on to save them.
The French and the Greeks are essentially holding themselves hostage and telling Germany and the United States that if they don't loan them more money then France and Greece will cause a nasty global recession.
[...] More turmoil in the eurozone would affect the global market, particularly countries like the U.S. whose financial system is intertwined with that of Europe. [...]