Financial Times columnist Gillian Tett declared in FT Magazine, a supplement to the weekend edition of the newspaper: "Another week, another bout of wailing about global debt woes. In Europe, there is panic about the finances of places such as Italy or Greece. In America, the US debt headache gets ever worse. And, on a more mundane level, millions of people (like me) have just returned from holiday feeling uneasy about their next credit card bill" ("Debt: It's Back to the Future," Sept. 10-11, 2011).
The lead editorial in the Sept. 12, 2011, International Herald Tribune took Europe to task over its management of the eurozone debt. It stated: "Europe's leaders believe they can stave off economic disaster without taking real action. They keep pretending that they will not have to ask taxpayers to help shore up fragile banks . . . and that Europe can continue to reap the benefits of monetary union without the shared responsibilities of greater fiscal union.
"No one else believes this—not credit markets, which have bid up interest rates on sovereign debt; not the International Monetary Fund, which has warned repeatedly that major banks appear undercapitalized; and not the Organization for Economic Cooperation and Development, which last week forecast negative growth in the coming quarter for Germany, France and Italy, the euro zone's three biggest economies.
"The immediate fear is that one or more major European banks may fail. Confidence is plummeting because they have large holdings of Greek, Spanish and Italian bonds. A major bank failure would damage America's economy as well—which helps explain the urgent pleas from Washington last week for Europe to come up with a strategy for recovery and growth" ("Europe's Fiscal Fantasies," emphasis added throughout).
Desmond Lachman, resident fellow of the American Enterprise Institute, wrote in The Wall Street Journal about the financial crisis in Europe possibly diminishing President Barack Obama's reelection chances. The U.S. financial system suffers from "massive exposure to the European banks . . . of over a trillion dollars—or roughly 45% of money markets' overall assets" ("The Euro's Problems Are America's Too," Sept. 9-11, 2011). Lachman fears Greece will default on its sovereign debt before year's end.
He also stated: "Judging by recent events, the euro zone's end-game may not be far off. Greece's economic and fiscal reforms appear to be seriously off track, and the debt crisis has now spread from Greece, Portugal and Ireland to Spain and Italy. These latter two countries are aptly described as being both too big to fail and too big to bail."
These huge debt problems are creating enormous problems on the world geopolitical scene. At this point no one can say with certainty how it will all shake out. But while an individual realistically can do nothing about these great problems, as an individual you can still apply time-tested biblical principles to your personal life.
If you are in debt, or just want to exercise better financial control over your economic affairs, request or download for our free booklet Managing Your Finances.
A companion booklet, Making Life Work, expands these biblical principles to subjects such as "Finding Success in Your Job and Career." These two publications work well together to bring the Bible into the problem-solving aspects of your life.