Economic Insights – September 2011

The global economy has remained weak throughout 2011.  As we’ve discussed previously, this weakness is primarily due to a high level of uncertainty, which has made consumers and managers increasingly risk-averse. Over the past few months, a great deal of this uncertainty has been driven by financial problems in Europe.  A growing number of analysts are drawing parallels between today’s European debt problems and the sub-prime crisis of 2008.  And, there are clearly similarities between the two situations. Those similarities reflect the role that government has played in both. For example, just like the 2008 panic, today’s European debt crisis is largely the result of policy mistakes.  In the U.S., politicians of all stripes decided that using subsidies and regulations...

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