An unexpected jump in weekly U.S. jobless claims and a surprise fall in existing home sales sparked more fears of a recession and sent U.S. stocks to their worst levels since the S&P downgrade. However, one economist is more worried about what is happening in Europe than the U.S., and he sees a growing risk of an eventual breakup of the single currency group.
"The really worrying thing is a 40 percent chance the eurozone might break up altogether...over the next couple of years or so," Robin Bew, Editorial Director & Chief Economist at the Economist Intelligence Unit told CNBC on Friday.
Bew believes investors are right to be worried, given the scale of the challenges facing the global economy.
"They are looking at U.S. and Europe, and they're thinking "My god, is this Japan?" And the trouble is it might be, and that's the real worry," he said.
According to him, the euro zone won't be able to cobble together a solution within the next few months even as credit market stresses increase.
"If you look at what markets are doing at the moment, it's not clear to us they've got that much time," he said. "We're becoming increasingly worried not just about this kind of balance sheet recession, but also what is going on in the euro zone specifically, and the danger something goes very badly wrong there quite soon."
Bew warns that the ripple effects of an eventual euro zone dissolution would be felt far and wide.
"If you look at banks not just in Europe, but banks in America too, they have enormous exposure - cross-border exposure - to sovereign debt and also to private sector debt, which would also be affected," Bew said. "You'd have to be worry about another wave of banking crises, and that's not just a European bank problem."
The growing debt problems on both sides of the Atlantic were likely to push the world into a recession, said Bew, who added the Economist Intelligence Unit forecasts a 40 percent chance of that happening.