Famous investor George Soros warned the other day of very severe consequences if the Euro wasn’t saved.

 “It seems to me that one still doesn’t understand what would happen if the euro collapsed,” Soros told the Swiss magazine in an e-mailed pre-release of tomorrow’s edition. “It would lead to a banking crisis that would be totally out of control.”

He even used the term “new Great Depression”. It sounds serious, especially since many have come out and said that the cost of saving the Euro is too high. Some say the chances of the Euro’s survival is 50-50, and that the Euro-bond plan would be nothing more than a band-aid.

So while everyone worries about a Great Depression 2.0, we overlook the fundamental reasons why the economy remains so weak.

    Unlike the deficit ceiling standoff in Washington, Europe is experiencing a real financial crisis, and today it began to get out of control.

 The European money markets have begun to seize up as pressure mounts on the Italian and Spanish banking systems, tracking the pattern seen during the build-up towards the financial crisis in 2008.

   “Europe’s money markets are undoubtedly starting to freeze up,” said Marc Ostwald from Monument Securites.

   “It’s not as dramatic as pre-Lehman but it is alarming and shows the pervasive degree of fear in the markets. People are again refusing to lend except on a secured basis.”

 Italian banks have been hit especially hard, with almost daily suspensions of their stock trading due to selling pressure. But today things went to a different level.

 Italian bank’s main stock market collapses, causing the suspension

 They called it a “technical problem” that just happened to coincide with a collapse in Italian bank stocks.

  I’ll keep this short and to the point.

   First of all, the stock market had a horrible day BECAUSE of the budget deal.

MARKET SNAPSHOT: U.S. Stock Losses Intensify After Senate Vote

 I’m watching the numbers now, and stocks will be closing near their lows of the day. People are putting their money where their pocketbook is and saying that the budget deal will hurt the economy.

  How much will it hurt the economy?

JPMorgan Chase has an early answer to that question.

  One thing we can all agree upon is that the debt-ceiling stand-off in Washington is a totally manufactured “crisis”. It is a financial crisis of choice. If I was a little more cynical and Machiavellian, I would think they were trying to distract us away from a real financial crisis.

 In fact, there is a real financial crisis happening in Europe. Until a week ago it was all over the front pages – Greece’s default.

 Perhaps you heard something about a bailout of Greece. That news came out right about the time that Greece dropped from the headlines.

 Problem solved, right?

Wrong.

  The bailout plan almost immediately ran into problems.

For starters, the rating agencies downgraded Greek debt to default levels BECAUSE of the bail-out plan.

 Rating agency Moody’s has downgraded Greece’s credit rating from Caa1 to Ca after the deal brokered July 21 by European leaders that included voluntary losses taken by creditors…

  One thing we can all agree upon is that the debt-ceiling stand-off in Washington is a totally manufactured “crisis”. It is a financial crisis of choice. If I was a little more cynical and Machiavellian, I would think they were trying to distract us away from a real financial crisis.

 In fact, there is a real financial crisis happening in Europe. Until a week ago it was all over the front pages – Greece’s default.

 Perhaps you heard something about a bailout of Greece. That news came out right about the time that Greece dropped from the headlines.

 Problem solved, right?

Wrong.

  One thing we can all agree upon is that the debt-ceiling stand-off in Washington is a totally manufactured “crisis”. It is a financial crisis of choice. If I was a little more cynical and Machiavellian, I would think they were trying to distract us away from a real financial crisis.

 In fact, there is a real financial crisis happening in Europe. Until a week ago it was all over the front pages – Greece’s default.

 Perhaps you heard something about a bailout of Greece. That news came out right about the time that Greece dropped from the headlines.

 Problem solved, right?

Wrong.

  I was scanning the news today when I came across an article that caused me to say, “Damn! I’m going to be right again.”

 WASHINGTON — Debt ceiling negotiators think they’ve hit on a solution to address the debt ceiling impasse and the public’s unwillingness to let go of benefits such as Medicare and Social Security that have been earned over a lifetime of work: Create a new Congress…

  Legislation approved by the Super Congress — which some on Capitol Hill are calling the “super committee” — would then be fast-tracked through both chambers, where it couldn’t be amended by simple, regular lawmakers, who’d have the ability only to cast an up or down vote. With the weight of both leaderships behind it, a product originated by the Super Congress would have a strong chance of moving through the little Congress and quickly becoming law. A Super Congress would be less accountable than the system that exists today, and would find it easier to strip the public of popular benefits. Negotiators are currently considering cutting the mortgage deduction and tax credits for retirement savings, for instance, extremely popular policies that would be difficult to slice up using the traditional legislative process.

 I will let others address the Constitutionality of this new legislative body, and instead focus on a target of the budget cutting – retirement savings.

   Ever since WWII it has been more and more difficult to define our “wars”. The line tends to get blurry when the President doesn’t have to consult Congress before sending in troops.

  However, when you are bombing a nation, and occasionally using ground troops, then I think it is defined as a war. Just because we aren’t trying to overthrow a government (i.e. Iraq and Libya) doesn’t mean we aren’t at war (i.e. Iraq and Afghanistan). Of course this means that we are at war in Pakistan, just at a lower intensity.

  Oh sure, there will be people who deny it. But consider the lessons of history on how easily bombing a nation can turn into a broadening war (i.e. Vietnam, Laos, Cambodia).

 There are many reasons why it is important to acknowledge how many wars we are engaged in. Not the least of which is so that it focuses the public on what our government is up to, rather than ignoring our foreign policy disasters until there is blowback.

 This means that we must pay attention to what our government is doing in Yemen, and most of all, Somalia.  

   I was talking with my brother the other day about the pathetic state of the local campo dog that wants me to be its owner. It has a badly injured foot that is beyond treatment. It needs to be put to sleep, but there is no vet within two hours of my Dominican pueblo.

  He asked me what the locals do in such cases. Generally the dogs are poisoned or simply left to slowly die. Then I responded with my blackest humor: “Dogs here are treated almost as badly as Haitians.”

  The president supports a liberation movement overseas, one in which local labor unions played a key roll.

 Meanwhile, labor unions are being crushed here at home and Washington politicians are largely hostile to citizens standing up for their rights.

 As Ted Rall put it: If irony were money, we’d all be rich.

 Am I talking about Egypt and Wisconsin today? I could be, but I’m not.

Instead I’m talking about events that happened two and three decades ago.

  The president supports a liberation movement overseas, one in which local labors unions played a key roll.

 Meanwhile, labor unions are being crushed here at home and Washington politicians are largely hostile to citizens standing up for their rights.

 Am I talking about Egypt and Wisconsin today? I could be, but I’m not.

Instead I’m talking about events that happens two and three decades ago.

 The one certainty in American politics is that freedom overseas is generally supported, but rarely supported when it means the people the politicians actually represent.

  The president supports a liberation movement overseas, one in which local labors unions played a key roll.

 Meanwhile, labor unions are being crushed here at home and Washington politicians are largely hostile to citizens standing up for their rights.

 Am I talking about Egypt and Wisconsin today? I could be, but I’m not.

Instead I’m talking about events that happens two and three decades ago.

 The one certainty in American politics is that freedom overseas is generally supported, but rarely supported when it means the people the politicians actually represent.