LyrArc Article Gist
The Economist view is that the USA, the Euro-zone, and the emerging markets, are all moving in different directions. The US has failed to address deficit concerns in the recent Bush tax cuts deal between Obama and the Republicans. The Euro-zone faces the prospect propping up its weaker members facing a debt crisis. and slowing growth from spending cuts.The monetary conditions are too loose and the flow of capital into emerging markets risks increasing inflation. This increases the chances of a macroeconomic shock if the govenments and central banks in emerging markets don't get the adjustments right- either doing too much or too little. The US faces the prospect of problems in the bond market with current management of public finances.The Economist views the risks compounding as a result of these divergences between these three regions, with the prospect of 2011 becoming a year of damaging shocks.

LyrArc Article Gist
The Economist points out that the Bush tax cut deal between Obama and the Republican leadership ignored concerns about the old ways of dealing with the defict- simply postponing decisions to deal with the public finances in a responsible way. Worse says the Economist, both sides showed they could buy each other off, which sets a bad precedent for the next two years.