On Sunday, elections were held in France and in Greece. And although the French, who have a large economy, elected a Socialist, the real — and most dangerous — news of the day came from the Greek election in which voters gave strong support, though not a majority, to parties of the extreme left and extreme right, at the expense of the long-ruling parties which had supported recent austerity measures and other efforts to get international bailouts.

The Greek election could be deeply unstabilizing for Europe, not because Greece is in itself a big economic problem for those outside of Greece, even if it defaulted on its debt. Instead, the problem is that it will harm the courage of other nation’s leaders — such as in Portugal, Spain, and Ireland — to make the difficult decisions necessary to get their budgets under control.

To be sure, people get the governments they deserve, and that will happen to Greece “in spades”, especially as they support far-right parties who are literally screaming for foreigners to leave the country. The head of the far-right Golden Dawn party is quoted as saying “The time for fear has come for those who betrayed this homeland.”

In the meantime, I expect markets to react somewhat badly, which will include a slightly rising US dollar — meaning (on the bright side) that oil prices will fall and (on the downside for those who have investments in gold and silver) that metals (along with other commodities prices) will also fall. Early indications for the US market are for modest weakness — which is far better than how things looked on Sunday night. One thing to keep in mind is that these election results, especially in France, were expected, and that a lot of traders have short positions on, which will tend to support the market on any sell-off. If the market wants to climb a wall of worry, they now have an even bigger wall.

For traders in financial markets, it’s time to hold on to your seat belts. And for would-be tourists, I recommend avoiding Greece.

All this said, there are a couple of mitigating factors for Greece and markets: First, since there is no majority — and not even a viable coalition — it is somewhat likely that new elections will be needed sooner rather than later, perhaps within a few months. Second, although a majority of Greeks claim to support being in the Euro, it is possible that Sunday’s elections are the first step on a path toward Greece’s exiting the European currency, which would actually strengthen it, weaken the USD, and be good for stocks and commodities. That, however, if it were to happen, would (in my opinion) take until at least early next year and will be accompanied by at least modest turmoil following an effective Greek default on their debt.

And as far as France goes, don’t forget that while Sarkozy was talking austerity (especially for others), the French budgets he proposed had little in the way of spending cuts, and the new Socialist is unlikely to spend substantially more.

Both of these countries, namely their ignorant, dependent voters, are getting just what they deserve. The big question is how much the rest of us will also have to suffer.