Despite the fact that there were some good U.S. economic releases that came out this morning which showed that the economy is growing, albeit at a slow pace. In the face of this positive news, the markets have taken a downturn following a meeting between the leaders of Germany and France..German Chancellor Merkel and France's President Sarkozy. The meeting of the two Eurpean powerhouses was held to see if both countries could come to an agreement on how to best handle the European debt crisis, which has cripple both the European and U.S. stock markets.
One of the options that was supposidely on the table was that German would step up and support the struggling countries and their financial institutions (similar to what the U.S. did when it rescued our financial industry from collapse in 2008). Germany decided that they weren't ready at this time to assume a more proactive role in helping to save the insolvent countries from defaulting on their debt. The other option was for German and France to issue European Union (EURO) bonds, which is the main currency in Europe, and sell them in order to raise money to give to the struggling countries.
Well, as one might expect, especially looking at the political gridlock we are dealing with in this country, no agreement was reached at this time and both countries agreed to negotiate and work with other European countries on coming up with a rescue plan.
So for now, it looks like we are yet again at the mercy of the European debt crisis.
