International Finance and Investment, The Greece Debt Crisis
Human fallibility ripped off Greece the dignity accorded to its rich history as the economy has been marred with endless conflicts, whose effects spreads beyond its national frontiers. The events revealing themselves in the Greece economy have caught the entire Eurozone in denials and bargains of accepting the reality of high debts. What led to the mess? With most banks demanding return of their money, it might insinuate a thinking that the Greece Debt crisis ensued from the failure of the banking system. However, though blaming the financial sector for Greece economic troubles appears popular, it denies facts on the root cause of system lapses that propagated such mess.
Rare are the times the policies implemented by the national governments adapts to the economic events, and in most cases their implementation postpones resolving the underlying problem, causing further confusion when crafting late hours solutions. The Greece debt mess of 2010 initiated from an ideational development surrounding capitalist crisis pokes holes to the dominant neo-Keynesian narratives with present renascent austerity descriptions offering little gain. The broader inquiry of the Greek debt crisis reveals impact of recent ideational changes translating to sovereign debt crisis, whose origin track to artificial-generated factors.
[...] Stavrakis, T EU Dismisses IMF Report on Criticizing Handling of Greece's Debt Crisis. [Online] Available at: http://www.therecord.com/news-story/3412554-eu-commission-dismissesimf-report-criticizing-handling-of-greece-s-debt-crisis/ [Accessed 09 September 2013]. GREECE DEBT CRISIS 21 Sutton, C S&P downgrades Greek debt to junk status. [Online] Available at: http://money.cnn.com/2010/04/27/news/international/Greece_debt_downgraded/ [Accessed 10 September 2013]. Thomson Reuters IMF says it lowered bar for Greece bailout program. [Online] Available at: http://business.financialpost.com/2013/06/05/imf-says-it-lowered-bar-for-greecebailout-program/ [Accessed 09 September 2013]. Vyas, M the Origin of Greek Soverign Debt Crisis. [Online] Available at: http://www.mananvyas.com/the-origin-of-the-greek-sovereign-debt-crisis/ [Accessed 08 September 2013]. [...]
[...] This would spark off a cycle of capital and investment inadequacy, further hurting the enterprise and consumer segments. Although the stock prices would decline and make them appear cheaper, investor confidence would decline and take longer for the economy to recover (Durden, 2011). GREECE DEBT CRISIS Grinding economy In the event that Greek defaults, this would trigger a series of turmoil larger than previous defaults of Argentina and Russia owing to the size of the debt currently at $500 billion. [...]
[...] Panaritis, E The Historical Roots of Greece's Debt Crisis. [Online] Available at: http://www.theglobalist.com/the-historical-roots-of-greeces-debt-crisis/ [Accessed 08 September 2013]. Phillips, B Markets Falls amid Greek Downgrade. [Online] Available at: http://www.aljazeera.com/news/europe/2010/04/2010427233143919993.html [Accessed 09 September 2013]. Reuters ECB could Survive a Greek Default, but What about the Banks. [Online] Available at: http://www.nytimes.com/2011/10/01/business/global/ecb-could-survive-a-greekdefault-but-what-about-the-banks.html?_r=0 [Accessed 09 September 2013]. Roos, J The Myth and the Tragedy: The Greek Debt Crisis in Comparative-Historical Perspective. [Online] Available at: http://roarmag.org/2011/04/myth-tragedy-greek-debt-crisismarx-keynes/ [Accessed 08 September 2013]. [...]
[...] This has taken the international authorities at grasp to intervene and save Greece as a buffer to contagious effect to other Eurozone countries. The IMF, along with the ECB and the EC are vital in resolving the Greek debt crisis and preventing similar challenges affecting other Eurozone states using the European Financial Stability Facility (EFSF) as the special purpose vehicle of preserving financial stability of EMU (ACCA, 2012) IMF Concern for the Greece Debts The international monetary fund provided bailout loans after the European nations failed to reach a final decision on solutions to arrest the Greece debt crisis. [...]
[...] However, while ECB may cope with the restructured government bonds it may not withstand systemic risks stemming from the Greece default (Reuters, 2011). In the event that the banks are crippled this would leave the holding collateral of ECB with no value but at manageable levels since it always accepts such collateral below the market value. However, the collateral holding would become problematic when the default infects the banking sector; practices that see ECB oppose Greek default (Reuters, 2011) Consequences for Global Markets if Greece Default With each passing year, the reality of the consequences of Greek default is evident owing to the contagious nature of the present interconnected global transactions. [...]
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