The financial crisis across Europe is so bad, the European Union Central Bank has put eurozone banks on notice, advising them that another $236 billion in toxic loan losses may be in store over the next year and a half.

The problem is the government debt across the continent -- and the crisis could potentially spill over far beyond its borders.

China now warns that Europe's ballooning debt puts the world economic recovery in jeopardy, with the risk of slipping into a double dip recession.

In the U.S., the federal debt has now crossed a major milestone of $13 trillion. Senate Minority Leader Mitch McConnell, R-Ky., called it a "frightening threshold" and criticized spending on top of that as "fiscal recklessness."

"We will have a debt on the course we are on of four hundred percent of our gross domestic product and that will bury us," said Sen. Kent Conrad, D-N.D.

But not only are governments in debt, ordinary Americans are in debt as well. On average, people carry about $44,000 dollars in consumer debt with the average owed on a credit card at about $4,000.

It is a sobering reminder that global debt is a long-term threat to both personal finances and the world economy.