The Cascading Effect of a Debt Crisis

I think the general public and sometimes government officials often forget the dangers of a cascading financial crisis.

For example, last week Moody's cut the rating on Ireland's debt by five notches to Baa1. Today Moody's cut ratings for Irish banks.

The financial crisis continues and perhaps will shift to Europe and Asia in 2011. Chances for an all out collapse are low. However, the financial drag of a debt crisis for both Asia and Europe will decrease GDP growth.

It is incredible that nearly three years after the 2008 financial crisis began to affect the US, other regions are still feeling the impact.