By Jeanne Sahadi, Senior Writer
May 7, 2010: 10:06 AM ET

NEW YORK (CNNMoney.com) — Technical glitch. Violence in Greece. Historic U.K. elections. A combination of these factors sent the Dow plummeting nearly 1,000 points Thursday before regaining two-thirds of the ground lost.

But here’s the thing: the market could be in for a very bumpy ride in the coming months — except it won’t have technical glitches to blame. U.S. debts, more likely than not, could be an underlying culprit.

In any case, Thursday’s Dow drama should be a wake-up call that policymakers heed, said Allen Sinai, chief economist and president of Decision Economics.

The story now is Greece’s debt crisis, and the fear of debt contagion to Portugal, Italy, Ireland, Spain — and EU’s neighbor, the United Kingdom.

All of that may spell trouble for U.S. exports six to 18 months from now, Sinai said.

Traders realize that, and they also realize there’s a risk that the United States — with its own large and growing stockpile of debt — will not have financial wiggle room to address future economic weakness, Sinai said. “Everyone with money on the line knows that.”

Not everyone shares the view that the shock from events in Greece could move the U.S. economy in a different direction. What happens to Europe’s biggest economies matters, said Lakshman Achuthan, managing director of the Economic Cycle Research Institute. “France and Germany are not going into recession anytime soon.”

Sinai stressed, however, that the risk of U.S. debt undermining confidence in the United States’ ability to handle potential shocks doesn’t have to turn out to be reality. “There is time to remove that risk,” he said.

The swelling debt loads of several EU countries, the U.K. and the United States means there will be a lot of competition in the market to finance all that debt in the coming years. “That doesn’t go away unless you take action,” Sinai said.

To reduce the chances of a U.S. fiscal crisis, the action Sinai and budget hawks have been urging U.S. policymakers to take now is to put together a credible plan to stabilize federal debt that would be implemented over time.

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