Stark euro debt crisis smothers Obama cheer

THIS summer’s volatility across global stock markets continued yesterday, with Thursday’s gains wiped out amid widespread investor nervousness over the European banking sector and whether US President Barack Obama’s $447 billion (€327bn) job creation plan stands up.

Investors have become jittery once again on the back of the European Central Bank (ECB) cutting its growth forecasts for the eurozone this week (region-wide GDP will grow by 1.6% this year and by 1.3% the next; as opposed to the 1.7% and 1.9% that it stated on Thursday); concern over the US’s ambitious job creation plan being passed and the sudden resignation of the ECB’s chief economist, Jurgen Stark.

This latter development has raised serious fears that there is a strong divide, amongst Europe’s policymakers on how to properly deal with the euro debt crisis and the deepening crisis in Greece, in particular.