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The toal loans held by the 15 largest banks declined by 2.8% in the second quarter, 2009. More than half of the new loans in April and Maycame from refinancing mortgages and renewing credt to businesses, not new loans, acording to an analysis by the WSJ.

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Antonis Samaras, leader of Greece's New Democracy Party, opposes the tax increases mandated by the E.U.'s June 2011 program for Greece. He supports the spending cuts. The shrinking economy with no hope for recovery under the current plan will only worsen the situation. The Greek economy declined by 4.5% in 2010 and will decline 3% to 4% in 2011, and unemployment is already at 16%, with much higher unemployment among young people. Many experts, and editorials in the Wall Street Journal and the Economist, share this opinion. With the austerity program's cuts and tax increases deeply unpopular among ordinary Greeks Samaras's party is moving ahead of Prime Minister Papandreou's socialist party in public opinion polls. Papandreou is not expectd to complete his term of office which ends in 2013, and a change of government may come by the end of 2011. At that point the E.U. leaders will have to negotiate with Samaras. Samaras says he told German chancellor Merkel- if your plan works I will say I was wrong, but if it doesn't you will need a new plan....

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CreditSights, a New York research firm says about $33 billion in losses from home equity loans will hit the five largest banks in the latter part of 2010, an amount equal to what they expect in earnings for 2010. This would have an adverse effect on the banks and has the potential to stall the economic recovery.

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Uki Goni writes from Buenos Aires, Argentina, describing the chaos and poverty of the years 2001-2003 following Argentina's default on its debt. At one point half of the population was below the poverty line. Argentina eventually recovered in 2004 under a new government of Nestor Kirchner, but had already incurred a terrible cost. This was especially hard on the lower middle class who had only their savings to live on and could not access their accounts at banks which were closed. Barter stores were common in those days as the barter currency gained wide usage for exchange of services. It is not clear whether this was due to badly implemented economic policy or defaulting on the debt. Goni says Greeks should seriously consider the cost of such a steep decline in the economy as they consider exit from the eurozone, and carefully evaluate the policies of Syriza politicians who risk a break with the EU.

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ECB president, Mario Draghi, said on March 25, 2014, "we will do what is needed to maintain price stability." Annual inflation in the eurozone declined to 0.6% forecast for the eurozone, 0.9% for Germany, and a negative 0.2% in Spain, for Feb. 2014.

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The graph tell the story, in early 2007 there were close to 4 million homes under water, in early 2008 closer to 8 million homes and in early 2009 closer to 16 million homes under water, close to doubling the number of homes under water. This is why more of the morgage securities become bad assets with each passing year, as their underlying assets the mortgages become high risk for default. During the third quarter the number of homeowners under water, or owing more than their homes were worth, were 11.8 million, and by the end of 2008, 13.6 million, according to Moody's Economy.com They are growing at close to 1.8 million every quarter, or at the rate of over 7 million a year. Which at this rate would reach 21 million homes under water by early 2010, if one assumed that government help only worked to offset the impact of further deterioration of housing prices, by lowering payments for some homeowners. A new housing rescue plan was announced March 4, 2009. This will supplement the $75 billion announced earlier. This plan announced March 4, 2009, is expected by the Obama administration to cover 9 million homeowners. Borrowers who face severe financial hardship that may cause them to lose their homes, are required under this plan to sign affidavits attesting to this. They will in then see their loans modified, payment periods lengthened, and interest rates dropped to as low as 2%, to bring the monthly payment down to 31% of income, the number that experts say is appropriate for sustainable payments. Only first lien mortgages, and homeowners who live in these homes and not homeowners who use them as investments, will qualify. The outstanding principal balance cannot be over $729,750. As incentives loan-servicing companies will get upto $3500 from the government, and the government will also match a portion of the ender's costs dollar for dollar. Homeowners get $5000 in government money to reduce their outstanding balances, as an incentive to them to stay current on these modified mortgages. The administration plans to announce plans to those holding second mortgages on their homes, who have difficulty modifying them. The other component of the plan is for Fannie Mae and Freddie Mac to refinance loans for borrowers who are under water, owing more than their homes are worth, even if they are wealthy enough to afford current payments. There is no income ceiling for this part of the plan. And these mortgages have to be held or guaranteed by Fannie Mae or Freddie Mac, with homeowners not owing more than 105% of the current value of their homes. ...

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Transcripts from U.S. Federal Reserve meetings in 2006 that show Bernanke, as Fed chairman, and Geithner, as head of the New York Fed, ignored the risks of a collapsing bubble in housing and mortgages.

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Republican presidential candidate Rick Perry tells an audience in Cedar Rapids, Iowa: Printing more money to play politics at this particular time in American history is almost treacherous- or treasonous, in my opinion." He was referring to Federal Reserve chairman Bernanke when he said: "I know there's a lot of talk and what have you about if this guy prints more money between now and the election... I don't know what y'all would do to him in Iowa, but we would treat him pretty ugly down in Texas." Perry's spokesman said Perry feels strongly about printing money, and "got passionate" in his comments.

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Applebaum provides an indepth look at the experiences and events that shaped the thinking of Janet Yellen, new chairwoman of the U.S. Federal Reserve in 2014. He describes the influence of Professor James Tobin of Yale on Yellen's thinking on how the government can influence the level of unemployment. A must-read for insights into the new Fed under Yellen.