Apparently, the resolution of the debt ceiling restored the dollar’s status as a safe haven in the eyes of the world’s investors. That accelerated the flight from European sovereign debt and European banks. That in turn raised fears in financial markets, driving down stocks, including in the United States.

They told me if I did not fall in line for a debt ceiling increase the stock market would tank, and they were right!

My instinct with the Eurozone crisis is the same as my instinct with the U.S. housing crisis. If it were me, I would want to make folks take their losses as soon as possible and try to move on. The European attempts to “manage” the crisis remind me of the U.S. attempts to prevent foreclosures. In my view, those sorts of interventions only keep the crisis in front of you rather than behind you.