"But how the crisis will play out in Europe will differ from how it plays out in the United States because the economies are structured differently. While Europe has very few toxic assets of its own, European banks owned a lot of bad U.S. assets, and were more highly leveraged than American ones. So we can expect more deleveraging in Europe than in the United States.
The other difference is that automatic stabilizers are much more important in Europe than in the United States due to the size of the public sector. While this will help Europe, the unprecedented scale of this crisis will require more policy action."