After all the trouble it took to overthrow régimes in Iraq, Afghanistan, Tunisia, Egypt, and Libya, now we have the leaders of Greece and Italy voluntarily and peacefully stepping down. It is truly amazing how much power there is in a bond's interest rate.
But what amazes me even more is how easily these changes in Greece and Italy could have been avoided, simply by not spending more than you earn! These two powerful leaders of western countries have been taken down by their own greed, rather than months of war or protests.
Could the same thing happen in America?
Italy has a debt-to-GDP ratio of 119% and Greece is at 145%. By comparison, the United States is at 63%, so we still have some breathing room at least.
But on the other hand Japan is at 200%. No one seems very concerned about that. Should we be watching for something to happen there soon?
17 November 2011
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