It's been nearly two years since Greece admitted it was broke, and while the European Union's band-aids have averted complete collapse, it was not until Oct. 27 that member countries could agree on a permanent solution.
European banks have already written down Greek debt 20 percent or more, but the new deal will require a 50 percent write-down. The EU and International Monetary Fund will provide $140 billion in rescue loans.
Greeks have rioted over the EU's required austerity measures. But without them-and the bailout money such contrition will earn-Greece will surely default on its debt. That's why Prime Minister George Papandreou's initial decision to hold a referendum on the deal caused consternation-and why he was forced to call it off after France and Germany warned that if the referendum failed, Greece would have to leave the EU.
Nonetheless, a growing chorus says the best solution is some form of bankruptcy, because pulling Greece out of the frying pan encourages bad behavior by Italy, Spain, and other nations nearly as troubled. Also, a default will force the EU to solve other structural problems with the euro and trade imbalances between member nations.
All of which is to say that this "permanent" solution also may be temporary. Marc Touati, chief economist at Assya Compagnie Financiere in Paris, said EU leaders "stopped the hemorrhaging," but they "have only saved it temporarily. Unfortunately, the fundamental problem concerning the absence of growth has not been resolved."
Initial public offerings, or IPOs, have been virtually non-existent this fall. Entrepreneurs considering IPOs say it's just too risky, in part because regulations and government jobs programs proposed by the Obama administration have unpredictably manipulated the markets.
Therein lies an irony: IPOs are among the private sector's most powerful job creators. The 1990s saw an average of more than one IPO per day. By contrast, the 2000s have averaged barely one per week, and some months much less. Since Sept. 1, only two U.S. companies have gone public.
When Pandora went public earlier this year, its staff increased by a third in a matter of months. In 1977, Apple had three employees. When Steve Jobs took Apple public in 1980, the IPO produced more than 300 millionaires, some of whom formed job-producing companies of their own. Today, Apple employs 46,000 worldwide.
Currently 215 companies are waiting to go public, the longest waiting list since 2001. Of course, not all of these entrepreneurs will create jobs like Jobs, but all of them will immediately start hiring, and at least a few of them will grow to employ thousands-if the government will get out of the way.
The problems in Greece led ratings agency Moody's to say it might issue a credit warning for France, while both Fitch and Standard & Poor's cut Spain's credit rating. At home, IBM and Apple posted lower than expected third-quarter earnings. That news stoked fears of slower technology spending. Nonetheless, more economists believe a double-dip recession is unlikely. They say the United States will show modest but measurable growth: not big numbers but "plus numbers, and not minus numbers," said Ken Goldstein of the Conference Board. "That's the good news." One positive sign: Homebuilding is ticking upward. September saw the best numbers in 17 months. Most of the gain came from apartment construction. Single-family home construction, nearly 70 percent of homes built, rose only slightly. Still, builders began work in September on 658,000 homes, a 15 percent increase from August. That's not nearly the 1.2 million needed for a healthy housing market, but it is a tentative step in the right direction.