Thursday, March 10, 2011
If oil prices stay high for a prolonged period of time it will be put incredible pressure on the Greek, Irish, and Portuguese economies. The risk of default increases as the price of oil rises. European leaders will need to be more proactive. Mr. Trichet is talking about raising interest rates, while here in the United States, Mr. Bernanke is giving indications that rates will not be raised. Why is Europe jumping so quickly to raise interest rates? Yes, I know the inflation fear is present, but default fears need to be addressed. I believe the US stock market is starting to smell it.