The National Security Forum Presents:
“The European Economic Crisis:
Implications for the U.S.”
With
Dr. Gerald O’Driscoll
Senior Fellow, the CATO Institute
The Ramada Inn, Thursday, January 5th, 9:00 am
Some time back we believed the worst possible outcome to the European fiscal crisis was a Greek default. Now a much wider disaster seems all too likely as the Eurozone could become the center of another global financial crisis. Markets have lost faith, driving up interest rates and threatening the stability of even major states, Italy most importantly. (Italy owes $2.5 trillion and must refinance $530 billion of that debt in 2012. It recently issued new debt at 8%, a rate that—if sustained—could force the country into default). A full-blown breakup of the Eurozone, given the exposure of American banks and investors there, would undoubtedly spread the crisis to U.S. financial institutions.
A sense of how vulnerable the U.S. economy could be if the euro currency union cracks apart is scary, especially if one considers the volume of American exports to the euro zone—about $330 billion a year—and several hundred billions more in U.S. investments and several trillions of dollars of other financial contracts between the two economies. U.S. banks alone have more than $220 billion at risk through investments in German and French banks alone.
Will European countries return to local currencies? Would that provoke civil strife in Europe (UBS AG predicted just that)? Would a disorderly collapse of the euro-zone lead to a global financial crisis? The new Chairman of the JCS has openly worried that the defense budgets of our European allies will decline precipitously. Warranted?
Gerald O’Driscoll is a widely quoted expert on banking and monetary policy. He has served as Director of the Center for International Trade and Economics at the Heritage Foundation, was VP and Director of policy analysis at Citigroup, and was VP and senior advisor at the Dallas Fed. Dr. O’Driscoll holds a PhD in economics from UCLA and has appeared on Fox, CNBC, Bloomberg and other media outlets.
The session will be held at the Ramada Inn on East 6th St between Sutro and Wells Avenues. A full breakfast will be served ($15 payable at the door). Please RSVP to this email or by calling 746-3222 (ACCEPTANCES ONLY!). The session is open to the public but we do need RSVPs from those wishing to attend. Coffee will be on at 8:15, the breakfast out by 8:30. Come early and enjoy some conversation with old friends.
Links to articles:
Click here: Austerity Reigns Over Euro Zone as Crisis Deepens – NYTimes.com
