Red Alert For U.S. If Greece Exits Euro

The AP of all sources published today an excellent outline of how contagion associated with a Greek exit from the Euro would affect the U.S. To put it mildly, the scenario is frightening. In a nutshell, Greece's return to the Drachma would cause hyperinflation in the land of olives and government handout connoisseurs, which would cause bank runs throughout Europe and a massive sell-off of Eurozone bonds (especially in the PIIGS nations), which would create a souring of credit default swaps and derivatives held by the U.S. (See 2008 Financial Crisis.) Additionally, the exit would create worldwide deflation (a very big no no), pushing the world deeper into recession. Incoming torpedo.