Jim Cramer says Europe is going through a similar crisis the United States went through in 2008. This is because monetary policy is not really established from one central bank, but rather a collaboration of officials from each of the Eurozone members known as the Governing Council.
This multi-national economic method slows down fast monetary response mechanisms and further aggravates their financial crisis. Additionally, obtaining funding from already cash strapped nations and competing fiscal agendas make further financial resolutions more complex. The International Monetary Fund has essentially forecasted near recessionary conditions for around 10 Eurozone countries in 2011-2012.
This multi-national economic method slows down fast monetary response mechanisms and further aggravates their financial crisis. Additionally, obtaining funding from already cash strapped nations and competing fiscal agendas make further financial resolutions more complex. The International Monetary Fund has essentially forecasted near recessionary conditions for around 10 Eurozone countries in 2011-2012.
Image source: Peter Kratochvil
In an interview aired by Bloomberg, Nouriel Roubini has a more dire view of the situation stating a recession is inevitable in several developed countries. However, he also states the extent of that recession depends on how well Europe manages the debt related structuring and fiscal policy necessary to implement this in an orderly way.
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