Here is what I wrote, on the 10th april 2010, in my report about The attraction of France for foreign investors (1) :
“The crisis is set to continue for a very long time yet, and will have a considerable effect on employment in OECD countries beyond the medium term.
Since the beginning of 2010, we have clearly witnessed the beginnings of a fragmentation – or, at the very least, a weakening – in what one might call "the sphere of public finance". To sustain the economy and save the banking system, governments and central banks have respectively borrowed and created at least six thousand billion dollars, making the currency markets even more volatile. This has led to a situation where, due to a genuine risk of default, there has been unbearable upward pressure on public borrowing, with the result that, one way or another, these difficulties will take us into another crisis period. Since spring 2010, interest rates on US ten-year Treasury Bonds have risen above corporate bond swap rates. This negative spread reflects the fact that the crisis has burst into the arena of public finances, including in the biggest countries.

A recent study by the McKinsey Global Institute(2) reminds us that there are only three ways for a nation to emerge from unsustainable public or private sector debt: outright default, inflation or belt-tightening. As we all know, this is the situation in which Greece, Spain and Portugal find themselves, as do Italy and, ultimately at a higher level, Britain and the United States; however, we cannot afford to believe that Germany and France are not faced with the same dilemma.

In two notes published in November 2008 and May 2009 respectively, I emphasised these risks and set out the obvious fact that a global crisis whose roots go back thirty years and which began in earnest three years ago will last at least a decade, while the new post-crisis world will be much less favourable to the West.”

(1) Read the full text : http://www.paul-giacobbi.org/The-attraction-of-France-for-foreign-investors_a590.html
(2) Debt and deleveraging : The global credit bubble and its economic consequences, january 2010