The Greek deficit crisis could turn into a Lehman-type event capable of freezing the financial markets, according to a report today from Deutsche Bank.

If Greece acts to restructure its debt at the expense of current bond holders, it could cause financial markets to freeze up just as they did after the Lehman Brothers bankruptcy in September 2008. Despite trillions in economic stimulus and bailout cash from the world’s governments some markets for some types of assets still aren’t functioning.

It’s good these days to read any warning of danger in the financial markets with a pound of salt. Someone may be yelling, The sky is falling because they want to get regulators to back off on proposals for stricter regulation or because they’re still looking for a government handout.

So how good is Deutsche Bank’s argument?

I think the report makes a plausible case that a restructuring of Greek debt would set some dominoes in motion. If as part of some plan that would reduce the country’s need for near-term funding, Greece forces its bond investors to take a haircut on the price of their bonds in any restructuring or suspends interest payments in the run up to a restructuring, bond investors who hold sovereign debt from other high-deficit countries could decide to sell those holdings or to demand higher yields. That would make it more expensive for countries such as Portugal and Spain to sell new debt in the financial markets to fund big current deficits and to refinance maturing debt. Forcing these countries to pay more interest on their debt would, in turn increase fears that these countries, like Greece, would be forced to restructure their debt at the expense of bond holders. That increased worry would push interest rates higher, leading to increased worry over restructuring. And on and on.

At its worst, this cycle ends with a country—Greece, Portugal, Spain, or whatever—unable to roll over its debt or to fund the current deficit. The banking system in that country could freeze since banks with big portfolios of sovereign debt wouldn’t be able to either sell it or borrow on it from the European Central Bank. That would cause parts of the national banking system to go into crisis.

All that’s true and it would have tremendous negative consequences for the countries involved and the European Union as a whole. The crisis could spread to the United Kingdom and to banking systems, such as that of Germany, with big exposure to the sovereign debt of these countries.

But it’s hard for me to see this setting off something like the post-Lehman global financial crisis—because the banks at risk in such a crisis don’t have the kinds of leveraged interconnections with the global banking system that a Lehman, an American International Group (AIG), or a Citigroup (C) did in the run up to that crisis. Lehman’s bankruptcy rippled out across the global financial system because that investment bank was the counter-party in so many leveraged deals. As counter-party Lehman had taken on or laid off some part of the risk in a deal that involved other financial institutions. When Lehman failed, those other financial institutions were left holding a deal without anybody on the other end. If, for example, a risky deal where Lehman had bought some of the risk from other institutions (for a price, of course) went bad those institutions had no one to collect from. And since they had themselves signed deals with other institutions over that same risk, when Lehman wasn’t around to pay up, those institutions couldn’t meet their obligations either. And since no one knew what banks owned what parts of what risk—absent Lehman—the markets for those assets froze since no one could accurately price anything.

In any post Greece crisis, the chain of risk would be much shorter. It would include the banks that bought the sovereign debt of Greece, Portugal, Spain, or whatever, the national central bank and the European Central Bank that made loans to these banks with that sovereign debt as collateral, and whatever investment banks or other financial institutions that insured the risk in the derivatives markets. That last class of institutions worries me because I don’t know who stands on the other side of the insurance policies against default that bond investors are buying at ever higher prices in the credit default swaps derivative market.

Still the amounts involved and the likely holding patterns make it hard to see how this turns into the kind of crisis that freezes borrowing in the commercial paper market, for example. The commercial paper market that ceased to function in the post-Lehman crisis was about $2.2 trillion. Greece’s entire GDP is just $341 billion. Spain’s is $1.37 trillion.

That’s not to say that the renewed worry over Greece and the possibility that it might spill over to Portugal, Spain, and the United Kingdom isn’t a real worry. The crisis has exposed the weakness at the center of the European Union. There is no formal mechanism for dealing with a crisis like this and so far very little leadership from the squabbling national governments that are the only feasible source of a response to the crisis.

Imagine if in the days after Lehman, instead of the U.S. government taking strong action to prevent the crisis from taking down American International Group, Citigroup, and other big banks, investors had witnessed weeks of indecision as Maryland fought with Montana and Georgia over what if anything to do.

 You may not like the shape of the government’s response and I think there’s certainly an argument to be made that there were better solutions, but in a crisis of financial confidence the worst thing you can do is dither. And that’s exactly what European governments have been doing.

If you think of the Greek and post-Greek crises as political rather than financial, I think you’ll have a realistic definition of the extent of the problem. The crisis could still tear the European Union apart—and that would take a huge bite out of the global economic recovery—but it wouldn’t lead to a replay of the post-Lehman crisis that almost took down the financial markets of the entire developed world.

The crisis could set back growth in Europe for years and that would lead to lower overall global growth but it’s hard for me to see the financial ripples turning into a tidal wave anywhere outside of Europe.

This is a truly nasty crisis. But the post-Lehman crisis threatened the end of the financial world as the developed economies of the globe know it. This one doesn’t.