Europe: a bumpy ride on the stock markets

Fears of contagion lead to France.  And European market concerns spread across the Pond.

As the oft-sensible Robert Peston of the BBC put it, "The more probable reason for the rout in European banks, which has depressed European stock markets and led to contagion on Wall Street, is simply those very basic emotions that afflict investors from time to time (especially recently): fear and capitulation.”

Resolve is now required from the European Central Bank (and national governments).  And Europeans themselves ought to decide whether or not they're prepared to lose sovereignty to provide a political mandate for a fundemental switch to fiscal union.  Only then can the Euro be saved in its current form.  And continued fears over sovereign debt levels in an increasing number of EU countries will not abate.  Nor will the exposure of most European banks to drops in the values of that asset class.

Troubles in the Eurozone have spread back across the Atlantic to the US, where the New York markets have plummeted again.  The world stares a double-dip global recession in the face, it seems.

If the Continent is to transform into a United States of Europe it needs to do so imminently.  The pressure is full on.

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