Every few years, it seems, one or another mismanaged eurozone country falls into one or another kind of crisis. This leads to speculation about the end of the common currency, which in turn spooks the global financial markets. Then the ECB conjures another trillion euros out of thin air, buys up and/or guarantees all the offending country’s bonds, and calm returns for a while.
At least, that’s how it’s gone in the past.
The latest crisis has more than the usual number of flash-points and could, therefore, be something new and different. Currently:
Greece. This charming but apparently ungovernable country only got into the eurozone in the first place because its corrupt leaders conspired with Goldman Sachs to hide the true condition of the government’s finances. It quickly blew up and has been on intensive care ever since. Now the latest bailout has become deal-breakingly messy:
‘From bad to worse’: Greece hurtles towards a final reckoning
(Guardian) – With another bailout set to bring more cuts, quitting the euro is back on the agenda.
The country’s epic struggle to avert bankruptcy should have been settled when Athens received 110bn in aid – the biggest financial rescue programme in global history – from the EU and International Monetary Fund in May 2010. Instead, three bailouts later, it is still wrangling over the terms of the latest 86bn emergency loan package, with lenders also at loggerheads and diplomats no longer talking of a can, but rather a bomb, being kicked down the road. Default looms if a 7.4bn debt repayment – money owed mostly to the European Central Bank – is not honoured in July.
This post was published at DollarCollapse on FEBRUARY 20, 2017.