[Sigh]....It is just amazing: from the tone and content of the story “preview”, one can almost unfailing guess this story comes from a Princeton liberal economist and the NYT.

the thrifty societies of Europe have long histories of encouraging the broad populace to save

With high marginal tax rates and wealth taxes, that statement is suspect.  I’m not going to buy the book to search for the details.  But the message is that irresponsible Americans are far inferior in their financial management…...

policy makers in European countries have also restrained the expansion of consumer and housing credit, lest citizens become “overindebted

Yep, Brussels has done a good job there, they have also created permanent high unemployment with lifetime unemployment benefits.  The citizens may not be overindebted, but the Euro-zone is about to collapse under debt…...truly a great model to follow…..

So how did America “go astray”?

In a rare display of truth….. An array of federal housing and tax policies enabled Americans to borrow to buy homes and products as no other people could.

So, how to fix the mess…..The new Consumer Financial Protection Bureau, while politically besieged, possesses broad powers to curb predatory lending

More Government; that’s the fix.  Actually I have a concealed weapons permit so I can defend myself against a loan predator jumping out from the bushes and forcing credit on me.

But the future looks rosey; The bureau might also promote the creation of financial education programs in every school

Yeah, dumb parents can’t do nearly as well as unionized teachers and Federally controlled schools can do.

You just can’t make this stuff up…......

One might also point out the economic failure—or imminent economic failure—of many EU countries, such as Greece, and soon Italy, which immediately makes her premise suspect.

Who still believes this tripe? It turns out neither the European nor recent USA model of spend, spend, spend really works. Yet, the grass is always greener over the Euro sceptic tank, I guess…

Hello? Interest rates, anyone? For more than a decade US interest rates have been held down intentionally in order to a) repress savings, and b) encourage borrowing ... for it is only through borrowing that Fed injections of new “money” can become part of the “money supply.”

Though the trend began under Greenspan in late 1987 it has gained traction ever since. Their entire intent has been to force people into riskier investments and the stock market because ordinary interest returns just plain suck.

Worked out great, didn’t it?  Total market debt—corporate, consumer, banks, and government—in 1995 was about $17 Trillion. At present it is well over $60 Trillion. And that is not including the $66 Trillion of unfunded entitlement obligations reduced to net-present-value at a 4% discount rate.

Europe? Bite me. We’ll soon be hearing more than we wish about Uni-Credit, Dexia, BNP Paribas, and others. They’ve already had a run on the banks in Latvia this month. European governments are nearly out of options for attempting to fix something that cannot be fixed without a deflationary collapse.