Europe’s Problems Still Threaten to Spill Into U.S.

http://online.wsj.com/article/SB10001424052702304065704577421921145788572.html

 Is Europe going to disrupt the U.S. economic recovery again? Can the mighty U.S. economy really be vulnerable to Greece, an economy roughly the size of Massachusetts’?
Just a few months ago, it seemed Europe had found a way to keep Greece in the euro. But Greek voter resistance to austerity prescribed by Germany ups the odds that Greece, which already has reneged on its debts, will leave the currency union. If that happens, Spain and Italy could be next in line for bank runs, bond-market skepticism, skyrocketing borrowing rates and deep recessions.
…”A sharp pullback by Euro area banks…would impede credit creation around the world, with the most acute pain felt in emerging economies,” J.P. Morgan Chase economists say.


If nothing else, European disruptions to global growth prospects may prove to be a catalyst for QE3 here in America.