FOR THOSE WHO THINK EUROPE HAS FOUND THE WAY – AT 8:04 A.M. ET:  The European economy is starting to sink us over here.  The problem with European nanny states is that they often have very irresponsible nannies:

U.S. stocks slid, capping the worst May for the Dow Jones Industrial Average since 1940, while the euro slumped and Treasuries rose as a downgrade of Spain’s debt rating and escalating tensions on the Korean peninsula triggered a flight from riskier assets.

The Dow tumbled 122.36 points, or 1.2 percent, to 10,136.63 at 4 p.m. in New York and lost 7.9 percent this month. The Standard & Poor’s 500 Index sank 1.2 percent to 1,089.41, led by financial shares on the Spanish downgrade and energy companies after U.S. President Barack Obama extended a moratorium on new deep-water drilling. Oil erased gains after rallying as much as 1.6 percent to more than $75 a barrel. Ten-year Treasury yields decreased 7 basis points to 3.3 percent. The euro slipped 0.7 percent to $1.2273.

COMMENT:  First it was Greece, now it's Spain.  And this is only the start.  Other European countries, and Britain, are in serious trouble.  Our own "recovery" seems entirely jobless.  And we are five months from a major election.

It's hard to see anything on the horizon that will help the Democratic Party's cause.  But remember that the Republican Party often works hard at losing, so we shouldn't underestimate its efforts.  And we certainly shouldn't underestimate the ability of this White House to pull something at the last minute.

May 29, 2010