Why is the US even considering providing more money to euro bailout?

Discussion in 'Politics, Religion, Social Issues' started by Zombie Acorn, Nov 4, 2011.

  1. Zombie Acorn macrumors 65816

    Zombie Acorn

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    Location:
    Toronto, Ontario
    #1
    http://m.guardian.co.uk/world/2011/nov/04/g20-italy-imf-checks-cuts?cat=world&type=article

    This article states the US is thinking of withholding further funding if Italy doesn't allow the austerity measures to be put in place to be evaluated, but my question is why is the US even involved in funding this bailout? We have our own problems to worry about and we already provide billions to the IMF (about 20% of their operations). I understand that Europe is important to the US, but at the same time they are the first on board for the US hate club at any misstep. I think Europe needs to pull their head out of their ass and fix their own problems this time.
     
  2. iBlue macrumors Core

    iBlue

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    Mar 17, 2005
    Location:
    London, England
    #2
    Because Europe is a huge economy and if it goes under, the US is going to feel it too. Believe me, a lot of Europeans are pissed off about this too.
     
  3. thewitt macrumors 68020

    thewitt

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  4. iStudentUK, Nov 4, 2011
    Last edited: Nov 4, 2011

    iStudentUK macrumors 65816

    iStudentUK

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    #4
    The EU and the US are the world's largest economies (which is bigger depends on how you measure, but they are practically the same and huge). If the US or the EU goes down the drain the other will be screwed. It's not ideal, my government is paying to bail out Greece, Italy etc too, but it's better than the alternative.

    Everyone is borrowing from China now anyway, so whoever bails out whoever else is really only acting as China's agent!
     
  5. thefnshow macrumors regular

    Joined:
    Mar 16, 2007
    #5
    this is the problem i have, nobodies economy should be tied together...if a country like greece or whoever are too stupid to manage their economy properly then they should fail and nobody else should be penalized in the process
     
  6. takao macrumors 68040

    takao

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    Dec 25, 2003
    Location:
    Dornbirn (Austria)
    #6
    3 letters:

    CDS

    if greece would go into uncontrolled default , the european banks whose credits default would want their money from the "insurance"...
    the biggest marketplaces for CDS papers ? wall street & london city

    some estimate that between 66-80% of all greek CDS are held by US & UK investment banks, hedgefonds, private pension funds
    and since no lessons were learned in 2008 regarding CDS transparency only the institutes themselves know how big the pile of .... is they have in their books

    and the worst thing is that this doesn't take in account the possibility of 1-2 continental european banks going default as well. but if greece defaults then this will be a safe bet. with combined greece + banking CDS triggering some financial investment institutes in the US & UK are very likely go belly up as well
     
  7. miloblithe macrumors 68020

    miloblithe

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    Nov 14, 2003
    Location:
    Washington, DC
    #7
    You think Europe is the first on board the US hate clip at any misstep? Really? All 27 European Union countries are the first countries on board to hate the U.S.?

    How does a country even hate another country?
     
  8. MorphingDragon macrumors 603

    MorphingDragon

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    Mar 27, 2009
    Location:
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    #9
    Cultural Imperialism instilling Xenophobia.
     
  9. jeremy h macrumors 6502

    Joined:
    Jul 9, 2008
    Location:
    UK
    #10
    To the OP. I understand your frustration, as others have said we (in Europe) are really angry as to mess 'the masters of the universe' have got us into too.

    A simple answer is that the Euro is one of your major problems too - it's difficult to figure out what the US banks exposure is but an FT blog says it's in the region of $46.4 bn to $767.5bn - nobody seems sure, even the banks! The US is perfectly entitled to pull up the drawbridge - but in the immortal words of a famous US actor - "... you feelin' lucky?"
     

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