Even heroes need a bailout sometimes. And it’s for this reason that governments have recently found themselves under the watchful eye of the financial markets. Investors have identified sovereign debt as a primary financial concern; specifically that of southern Europe. However, these investors appear conflicted with regard to how to move forward. One the one hand there is concern that banks with any debt to their name won’t survive if individual countries do not cut their deficits and subsequently default. On the other, if numerous governments all employ the same tactic of tightening fiscal policy at the same time, the global economy will suffer. In light of the fact that there is no superman, and banks, governments and markets are all fallible, the question that remains is; where to from here?
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