With all of the recent focus on the fiscal cliff and now earnings, traders appear to be forgetting the massive mess across the Atlantic in Europe and the eurozone. Remember Greece? The European debt crisis took Greece down with two separate bailouts. It was so dire for this beautiful country on the Mediterranean Sea that Greece actually needed a second bailout to pay the payments on its first emergency loan, or risk default!

The reality is that the eurozone financial crisis is still around—the market just pushed it aside for the election, the fiscal cliff, and now earnings. But be aware that the problem overseas is not going away. Consumer confidence in the eurozone came in at a muddled -26.5 in December, according to the European Commission. I’m not sure about you, but I believe this cannot be good.

The problem with the eurozone is not only the massive debt loans that have impacted Greece, Spain (read “Spain Is Delusional Believing Everything Is Okay.”), Ireland, Portugal, and Italy, but also the current recession and muted growth that will likely last into this year and perhaps into 2014.

At the same time, a major issue is the super-high unemployment rate encompassing Europe and the eurozone. In the eurozone, the unemployment rate was 11.8%, or about 18.8 million unemployed, in November, the highest number since the eurozone formed in 1999. (Source: “EU unemployment tops 26 million for 1st time,” Yahoo! Finance via Associated Press, January 8, 2013.)

Spain has about a quarter of its people out of work. Greece’s unemployment stands at 23.1%, while Portugal is at 15.7%, Ireland is at 14.9%, and Italy is at 10.7%, according to Thomson Reuters. And you thought we had it bad here.

The European Commission came out and predicted a gloomy outlook, with the eurozone contracting 0.1% this year and Germany’s gross domestic product (GDP) growth being slashed to 0.8% this year from the previous 1.7%. The stalling in Germany is not good for the eurozone.

Add in the massive debt loans and pressure to cut spending, and you’ll realize why I’m deeply concerned.

Spain could see its economy contract by 1.7% in 2013, according to Goldman Sachs. The country is pursuing its own aggressive austerity plan, focusing on budget cuts in lieu of tax increases as the country tries to avoid asking for a bailout and all of the stricter budgetary requirements that are associated with a financial crisis. I’m not convinced this will work, given that the Spanish government forecasts the country’s debt will be 90.5% of its GDP this year. (Source: “Spain’s debt to rise to 90.5% of GDP in 2013,” Yahoo! Finance via Associated Press, September 29, 2012, last accessed January 8, 2013.)

Of course, my big concern is that the mess in the weak countries is driving down growth in France and Germany, the two pillars holding up the eurozone. France is finding things are getting more difficult as the eurozone tries to dig itself out of its financial mess. Capital Economics suggested France and Germany will face another recession in 2013.

Maybe it’s time to refocus on the eurozone?

About Michael Lombardi (http://www.profitconfidential.com) Michael bought his first stock when he was 17 years old. He quickly saw $2,000 of savings from summer jobs turn into $1,000. Determined not to lose money again on a stock, Michael started researching the market intensely, reading every book he could find on the topic and taking every course he could afford. It didn’t take long for Michael to start making money with stocks, and that led Michael to launch a newsletter on the stock market. Today, Michael only employs the top market analysts and editors. Some of our recommendations have posted gains in excess of 500%! Michael has authored and published over one thousand articles on investment and money management. Along the way to building Lombardi Publishing Corporation, now with over one million customers in 141 countries, Michael became an active investor in real estate, art, precious metals and various businesses. Readers of the daily Profit Confidential e-letter are offered the benefit of the expertise Michael has gained in these sectors. Michael believes in successful stock picking as an important wealth accumulation tool. Married with two children, Michael received his Chartered Financial Planner designation from the Financial Planners Standards Council of Canada and his MBA from the Graduate Business School, Heriot-Watt University, Edinburgh, Scotland.