This morning’s key headlines from GenerationalDynamics.com.

‘Years of retrenchment’ for America’s ‘zombie consumers’

During the credit bubble a few years ago, the world could count on America’s “generation of ‘zombie consumers'” to spend their time at the mall, providing the foundation on which Western prosperity was built. However, these recovering shopaholics face “years of retrenchment,” according to Morgan Stanley’s Stephen Roach. U.S. consumer spending rose only 2.7% in the first quarter, down sharply from 4% in the last quarter of 2010. This is a big deal, considering that the consumer accounts for about 70% of the US economy, down from 71.3% during the bubble. The long-term average is 66%, so by the Law of Mean Reversion, it will fall to about 60% as the financial crisis worsens. Extending unemployment benefits, mortgage forgiveness, and massive government and monetary stimulus are likely to “inhibit the deleveraging and balance-sheet repair that America’s zombie consumers now need for post-crisis healing,” according to Roach. “Notwithstanding government life-support initiatives, U.S. consumers seem headed for years of retrenchment.” Money News and Globe & Mail

85% of international investors say that Greece will default

In a survey of international investors, 85% said that Greece will probably default on its debts, despite the austerity measures and EU bailouts. A majority of those surveyed predict the same fate for Portugal and Ireland, which followed Greece in asking for EU bailouts. According to one analyst, “All these countries will go bust at some stage. I just can’t see a scenario in which these countries get out of their debt problems.” However, the European Central Bank says that a Greek default would cause financial disaster. Bloomberg

Taliban terrorists avenge Osama bin Laden killing

The deadliest terrorist attack this year in Pakistan killed at least 70 paramilitary recruits and 17 civilians in a twin suicide bombing attack on the Frontier Constabulary’s headquarters in Shabqadar, near Peshawar, in Pakistan. Tehrik-i-Taliban Pakistan (TTP), the Pakistan Taliban, claimed responsibility for the attack, and said that the attack had been carried out to avenge the killing of Al Qaeda leader Osama bin Laden in Abbottabad. Dawn

In harsh language from after more than ten hours of debate on “situation arising from unilateral US action in Abbottabad,” Pakistan’s parliament demanded an end to US drone strikes on its territory and called for an independent probe into the raid by US troops that killed Osama bin Laden. AFP

Jordan’s Palestinians demand right of return

On Friday, 6,000 Palestinians in Jordan gathered near the border with Israel to mark the founding of Israel and to demand to be allowed to return to the land that Israel took from the Palestinians in the genocidal war between Jews and Arabs that followed the 1948 partitioning of Palestine and the creation of the state of Israel. The largely peaceful rally was organized by the Jordanian Muslim Brotherhood, trade unions and other political movements. CNN

Member of Iranian Revolutionary Guards calls to attack Saudi Arabia

Hostility between Iran and Saudi Arabia has greatly increased over the Bahrain uprising that pits a Sunni government, supported by the Saudis, against the Shia protesters, supported by Iran. In particular, the Iranians have objected to the Saudis’ military intervention on the side of the Bahrain government’s bloody crackdown. A senior member of Iran’s Revolutionary Guards close to Mahmoud Ahmadinejad is calling for Iranian intelligence to train Hizbollah-like Shia cells to carry out sabotage with explosives in Saudi Arabia. Al-Bawaba