We’ve seen several retrospectives of the Administration’s actions to deal with the economic crisis in 2009-2010, and Ryan Lizza has a new one in the New Yorker. His recounting of the memos and exchanges between Larry Summers and Obama add to the view of Summers inducing Obama to pull his punches for political reasons, ensuring the stimulus would be too small.

The debt talks between Greece and their bondholders, thought to be a done deal late Friday, spilled into the weekend and still found no resolution as of today. The short version is that the creditors want a higher coupon, or interest rate on the new bonds they’ll accept in exchange for taking at huge hit on the bonds they currently hold.

In Greece, creditors and the government continued their work on a debt deal that would give a haircut to debt holders and set a new interest rate going forward, reducing Greece’s debt level. After hedge funds appeared to be playing a game of chicken by holding out on a deal, cooler heads may have prevailed.

The hedge funds swooped in late, but the banks or other investors that made these loan deals did so knowing full well that they risked a default. That’s true of any loan. There are two sides to every deal. The hedge funds, in fact, took their deal knowing that Greece was on the precipice of default. They’ve just decided to be raging assholes, and threaten to blow up the world if they don’t get paid back. So the idea that hedge funds have an inalienable human right to make this profit is one of the most egregious things I’ve seen in a long time.

The Greek bailout is in trouble, threatened by a disagreement between the ECB and Germany and France who are threatening not to release the next tranche of bailout funds. The Greek government has no leverage, and any default will hurt mainly the Greek people.

One of the standard opinions from many economists, especially those on the right, was that the US spending/debt load was unsustainable and would surely spark massive inflation. After the downgrade of US debt by Standard and Poor’s after the debt limit deal, debt was seen as toxic. America just had to deal with its debt problem or the bond market would deal with it for them. This dog simply has not barked.

The new plan to save Europe includes a condition that, says Felix Salmon, private bondholders cannot take losses on any future eurozone bail-outs. This is merely an invitation for recklessness by the bondholders, with a giant safety net put under them by Europe.

France and Germany have reached agreement on a fiscal plan for Europe that has everything to do with veto power for the European Commission over sovereign budgets and very little to do with the long-term problem of smoothing growth over 17 different countries operating under one monetary union.

We’re seeing a kind of bank run happening in Europe. The bond markets recognize that the European Central Bank is unwilling to save sovereign countries that cannot create their own money. So they’re just moving away from one country to the next, causing the cost of bond yields to rise to unsustainable levels. First it was Greece and Ireland and Portugal. Then it was Italy. Now it’s Spain.

The problem for the United States is that there’s no understanding of how much exposure US financial firms have to the expected fallout, especially if there’s a default event. JPMorgan Chase and Goldman Sachs announced their overall derivatives risk from sovereigns today, but wouldn’t pinpoint how much of that comes from Italy or Spain.