Don't shoot the messenger, but Mr. Rehn of the EU Commission says that the Eurozone and the UK are likely to go into recession. The Growth forecast for 2012 was revised down from 1.5 percent to .5 percent.
So, if the Eurozone goes into recession, the US will likely double-dip. In an interconnected global economy, no matter how "good" things appear to be in the US, a contraction in Europe will bring us back down into a double dip scenario.
There is also speculation of plans for countries to be allowed to leave the Eurozone, and the ECB says it has no more ammo. So, the question is, how long can they keep Italy afloat?
The Italian 10-Year dipped below 7% to 6.9%, but today, it paid a record 6.087% for the 1-Year Treasuries at the auction. Just last month, it was only 3.57%.
6.1% for 1-Year Paper?! Unsustainable.
Are you reading for the Armageddon scenario? The UK Treasury is sure getting ready for 'economic Armageddon' if the euro falls apart, so it might be wise to get your portfolio ready, too.
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