There was a time when the Greeks ruled the known world. From Alexander the Great and his Macedonians to Leonidas and his Spartans the Greek people have a fine fighting tradition, however there is an enemy they cannot defeat. Like a Hydra their enemy has several heads and refuses to die. The ancient monster of greed is threatening to swallow the island nation whole and to take the entire EU down with it.
The economic strife in Greece is a prime example of a vicious cycle. EU and IMF austerity mandates have forced Greece to dramatically reduce government spending. This reduction of spending caused the Greek economy to shrink dramatically thus greatly reducing the tax base.
Similar austerity measures have been taken all across the EU. Making matters considerably worse several European nations have had their credit ratings downgraded and they have seen an increase on bond yields. Simply put an increase on these yields would dramatically increase interest rates for several European nations. Countries like Greece and Spain cannot service their debts as it is. If their interest goes up a sovereign default would be eminent.
The European media has taken to calling these ailing nations PIIGS (Portugal, Italy, Ireland, Greece, and Spain). Not only can these failing economies drag all of the EU down with it, they can also have a devastating effect on America.
American companies and investors have significant exposure to the European economy. A systemic failure of the Euro Zone could capsize our already listing economy.