Europe on the brink of Economic Collapse?

Often in discussions with friends, some of them in my survival group and some not, the topic of how the world's economy can effect or cause a depression or even an economic collapse of this country is discussed.

As simple as I understand it, as I am not a economist or involved in any aspects of financial markets,....the United States as a government, and as commercial enterprises (banks and the financial institutions) owns some of Europe's debt. Likewise, financial institutions and governments in Europe own some ofthe U.S. government debt.  If either suffers large losses, re-calling some or all of the owed debt could over burden the other, causing mild to hyper inflation, a depressions or even an economic collapse or collapse of that countries currency.

Lots of possibilities in my admittedly non-financial educated mind........hyper inflation on commodities from foods to fuels, especially what we have to import,.............the tanking of the dollar in value relative to other currencies or even the total collapse of the dollar. Pictures of German citizens prior to World War II pushing wheel barrows of money to a bakery to buy bread come to mind,....or more recently, images of Greeks standing in soup kitchen lines or de-foresting the rural areas for fire wood to heat their homes.

So just how likely is a collapse in Europe? Basically, all the Eurozone countries are at risk with the exception of Germany. Let's take a short look at some of them:

SPAIN

Spain’s unemployment rate is now at 26 per cent. The austerity measures of the Government is causing social unrest, especially upon the unemployed. The Government's efforts to rescue banks with money it has to borrow furthers angry in the private sector. Lower benefits for out of work employees and higher taxes further burden this economy which is on the brink of either a social collapse or a financial one. One will precede the other.

PORTUGAL

Portugal's unemployment rate is about 18%, only behind Spain and Greece. The economy fell over 3 percent last year causing the government to raise taxes and cut government pensions to try and bring in more revenue. (Sound familiar?)

The government is being forced to enact austerity measures in order to receive international money for a bailout. Most of these bailout's are usually phased providing minimal relief versus the increasing social pressure of the unemployed and entitled youth.

FRANCE

The Washington Times says that "Look no further than France to see where the faltering U.S. economy is headed. President Obama has adopted a distinctly European fashion when it comes to expanding government and imposing tax hikes. For this, we can expect to achieve the same results as our ally on the Continent. "

France is “totally bankrupt,” Labor Minister Michel Sapin admitted last month. Unemployment over 10% with a whopping 27% unemployment rate for French youth. The French government takes up over 55% of the Gross Domestic Product. There are demonstrations, after demonstrations of the public sector unions fighting what the government say's are necessary government spending and work force reduction.

GERMANY

Germany is the Uncle Bailout for many of these financially screwed European countries. Germany has a constant fear of the collapse of the Euro and with it the European Union, saying goodbye to all the debt that is owed Germany.

The German government is reportedly holding assets in order to cover giant potential losses.

ENGLAND

Unemployment is way up in England, while manufacturing and therefore job production is down. Industrial indexes are down to wear they were 25 years ago. The pound sterling is down to a 2.5 year low.

Inflation is running at over 3%, combined with the fall of industrial production and high employment is causing the analysts to think that a large recession is coming.

CYPRUS

The Cyprus government is announcing a plan to tax bank accounts. Are you kidding me? Unfortunately no. The U.S. is not far behind this concept with the US Government taxing health care plans. But at least our government does not tax our holds other than the interest earned on it.

GREECE

A plan to cut the government work force by 150,000 is being laid out in order to placate creditors that Greece is serious about reducing government debt. Austerity measures, also in order to gain bailout money, creating hostility towards the government on a large scale. This can be a chase your tail type of thing, if the government ever gets on track to stabilize the economy, they may run out of patience with the population and find themselves replaced with a different political party and philosophy. And while the Greece government is forecasting a recovery on late 2013, the population has been taking money out of their banks fearing a collapse.