As  expected after voters in France and Greece rejected austerity measures  enacted in response to the ongoing financial crises, the Asian markets  went into a nosedive. Even oil per barrel sank below $97.

Earlier  Sunday evening news reports indicated the possibility of negative  reactions from markets around the world as France upset the incumbent  conservative government and chose a socialist to lead the nation. Those  reports also cast Greeks tossing out parties and going for newer more  socialistic parties as also troubling.

GREECE

_ How much does it matter?

A  great deal. The financial mess in Greece has rocked financial markets  for years. To stay afloat, Greece's government depends on loans from  international creditors, and it must meet strict targets on cuts if it  wants to keep receiving money. But Greek voters elevated two parties  that rejected terms of the bailout. If Greek leaders refuse to stick to  terms of the bailout deal, the International Monetary Fund may pull the  plug on supplying funds.

"Given the degree of uncertainty that is  going to enter Greek policymaking after these elections, I suspect the  prospects of Greece being able to undertake serious reforms has been  reduced even further," said Cornell University professor Eswar Prasad.

_  Best-case outcome: Greek parties build a governing majority that  negotiates successfully with international lenders. Greece's lenders  will dial back some demands for austerity to quell political unrest and  allow the Greek economy to recover. Greece will continue to use the  euro.

_ Worst-case outcome: Greece's new leaders are unable to  find common ground with international lenders. The IMF pulls the plug on  future bailouts and richer European nations refuse to step in. Greece  defaults and leaves the euro currency or is expelled. There is panic  among holders of bonds issued by other financially troubled countries,  creating a cascade of defaults and requiring more bailouts.

_  Market outlook: It could take weeks for Greece's political parties to  form a governing coalition, experts said. And the country is expected to  take yet more austerity measures in June. Parliamentary developments  will likely drive trading in the coming weeks, especially if investors  begin to fear that a new government is unstable and the bailout program  at risk.

Yet even if Greece defaults and leaves the euro, the  impact on international markets might be small, said Jacob Kirkegaard, a  research fellow at the Peterson Institute for International Economics.  Bond investors already know that Greece is in a fiscal mess, and have  marked down the value of their holdings, he noted.

"It wouldn't be without waves, but it would be a manageable situation," Kirkegaard said.

FRANCE:

_ How much does it matter?

Experts  disagree. Some say Hollande emphasized his differences with Sarkozy for  political reasons, but will pursue a similar path of budget cuts once  he takes power. Others believe Hollande's strong rebuke of the austerity  plan could change the minds of European politicians currently focused  on deep cuts to spending on social welfare programs and worker benefits.

_  Best-case outcome: Hollande teams up effectively with German Chancellor  Angela Merkel, who has led the crisis response with Sarkozy. His  proposal to soften austerity measures is embraced by France's parliament  and bond investors, allowing France to balance its budget on a slower  schedule. His view that government spending will combat the recession  proves accurate, other nations follow suit and Europe returns to growth  in the next couple of years.

_ Worst-case outcome: In  parliamentary elections next month, French voters elevate far-left  politicians. To assuage them, Hollande boosts spending sharply and  rejects austerity and other reforms aimed at stabilizing France's debt  load. France falls deeper into debt and faces further downgrades by  credit rating agencies. Renewed fears about a French default kick off a  fresh wave of crisis fears, destabilizing global markets.

_  Market outlook: Hollande's ability to reshape French and European policy  hinges heavily on the upcoming parliamentary elections. Markets are  unlikely to react strongly to his election until they have a clearer  sense of what Hollande will be able to do, experts said. But traders  will want an answer soon, said Cornell's Prasad, who studies trade  policy.

"I don't think markets have the patience to string this  out until summer," he said. If France's finances appear less stable,  traders would have one more reason to abandon stocks and other risky  investments.

http://startribune.com/nation/150360735.html

As  morning dawned on the other side of the world, the Asian markets did  indeed beging to plunge on top of the election results in Europe.

Asian  stock markets were pummeled Monday by election results in Greece and  France that heightened uncertainty about Europe's ability to solve its  debt crisis.

Signs of a faltering economic recovery in the U.S. compounded the dour mood while oil slid to nearly $97 a barrel.

Weekend  election results in Greece sent tremors throughout Europe as voters  punished the parties responsible for highly unpopular austerity measures  instituted to prevent the country from defaulting on its massive debts  and exiting the euro currency bloc.

No political party won enough  votes to form a government, raising the possibility of new elections  within months and protracted uncertainty for global markets.

Meanwhile,  in France, President Nicolas Sarkozy lost to Socialist candidate  Francois Hollande, who had criticized the country's austerity program  and wants to boost government spending.

Energy stocks were among the hardest hit after the price of oil lost about 8 percent over three trading days.

http://hosted.ap.org/dynamic/stories/W/WORLD_MARKETS?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2012-05-07-00-57-16

Now  investors and brokers nervously wait for the US markets to open on  Monday. A continued downturn after closing down on Friday based on Labor  Department figures on jobs and unemployment could cause added concern  that the US economy may stall.

From  the Cornfield, as interconnected as the world has become a pebble cast  into a pool can ripple from ocean to ocean gathering steam like a  tsunami or hurricane.