U.S. Markets Still Weak as Europe Ponders Austerity

U.S. markets remain in the red as Europe moves toward the Great Austerity.

The Dow Industrials are now down 29 points at 10,165, the S&P 500 is off just a point at 1,086, big improvements from the steep declines registered at the open.

Great Britain this morning leads the parade of European austerity, with Britain’s chancellor George Osborneoffering up �6.2 worth of government spending cuts for this fiscal year in order to reduce a �156 billion budget deficit. Germany is already outlining plans for a �10 billion in cuts per year starting next year.

The cuts come as the Euro continues to gap down substantially, now trading a little above $1.24, versus Friday’s closing cross of $1.2574. Still, the Australian dollar, a primary measure of risk appetite, picked up slightly to $0.8324 from Friday’s close of $0.8316.

Meantime, the Financial Times’s Jamie Chisholm reports the cost to loan money among banks, Libor, has risen by above half a percent for the first time since last July. Some economists expect Libor could go to 1.5% this year.