Greece: A new domino theory

From the Washington Post:
Economic policymakers and many private analysts see a danger that the Greek troubles will lead to the next wave of turmoil for the global economy. Investors are pouring money into government debt around the world, viewing it as a safe investment in an uncertain time. That has helped keep interest rates very low in most large countries . . . One of the lessons of the global financial meltdown is that crises tend to evolve in unpredictable ways . . . when market concerns about Thailand's foreign debt led investors to question the finances of several other East Asian nations, resulting in the Asian financial crisis of 1997-98 . . . So far, (this) episode has made it cheaper for the U.S. government to borrow, as investors have moved money into dollars -- and Treasury bonds in particular -- to try to reduce exposure to developments in Europe. The federal government could borrow money for 10 years at 3.6 percent on Thursday based on bond yields, very low by any historical standard and down from 3.84 percent at the beginning of the year.

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