Europe. The economic focus is on Europe all the time, but it is no longer a singular event. This week Europe became the cue ball in a violent pool-table break, balls now ricocheting into each other, caroming off side rails, bouncing into thin air.
Weak domestic data had minor impact by comparison, but the last thing the global table needed was more doubt about recovery. New claims for unemployment insurance jumped back to 471,000 last week, the highest in three months.
Inflation numbers were the lowest since 1961 (year-over-year core only point-nine percent) -- that's good news, but not if we're headed into deflation. Applications for purchase mortgages are in post-tax credit free-fall, with the low-down-payment FHA/VA loan applications off 34 percent.