As the euro crisis continues to grow, the popular opinion among Americans is that this issue will not have an impact on their day-to-day lives. Even though the eurozone is located across the Atlantic Ocean, however, it is naive to assume that their financial crisis will not cause a ripple effect.

What is the Euro Crisis?

The eurozone was developed in 1992 as a way for European countries to share the same currency. The belief was that this would not only make it more convenient for European citizens and tourists to travel throughout Europe but that it would also result in a stronger form of currency. The idea of a eurozone was embraced quickly, and there are 17 nations involved today.

The first cracks in the system began to show in 2008. Since then, several member countries have experienced financial hardships, and the eurozone has had to provide bailouts to keep some of these countries from going bankrupt. High amounts of debt and dubious accounting practices have plagued the eurozone, and each time one of the member countries gets into trouble financially, it impacts the economic viability of every other country within the zone. The eurozone is currently facing a weakened currency and abandonment threats from some of its member countries.

What does this mean to Americans?

The eurozone crisis has several implications that are being felt around the world. America has been dealing with its own financial crisis for close to a decade, and this is not the type of thing that we should ever hope to have in common with another country. Just as Americans have faced job shortages and a weakened USD, the citizens of the eurozone are also feeling the negative impact of their zone’s financial issues. When the American crisis started it created issues that were felt around the world, and the same thing is happening due to the eurozone crisis.

How will the Euro Crisis Impact Me Financially?

As an individual, you might believe that the issues in Europe will not impact you personally. If you take a moment to truly consider the way the global economy works, though, you will quickly see the error of this thought process. Sudden changes in market perception can cause panics similr to what happened in 2008 which caused markets world-wide to crash and burn. With the Billions owed by bankrupt European nations facing credibility issues it is easy to imagine that it could snowball into another worldwide economic crash. This could take down not only soverign debt but also corporate debt, the stock market and currencies.

Euro Crisis and the Cost of Tourism

Another major impact that will be felt in America as a result of the eurozone crisis is a decline in tourism. European visitors typically account for approximately 20 percent annually of all non-American tourists. If the eurozone crisis continues to grow, these numbers could shrink. The resulting impact will hurt the American economy in many ways. Consider all of the hotels, airlines and car rental companies that will feel a major decline in their sales. Next, add on all of the tourist hot spots, restaurants, gas stations and shopping establishments that will also feel the pinch.

See Also:

• Is the Greek Tragedy Coming to America?
• How U.S. Unemployment Rates Compare to other OECD Countries
• How Global Financial Developments are Affecting the Price of Gold
• Is the United States Headed Down Europe’s Financial Road?
• European Union Agreement: Good or Bad for the Dow Industrials?