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Greece's debt has been downgraded to junk status

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  • Greece's debt has been downgraded to junk status

    Greek bonds rated 'junk' by Standard & Poor's

    Greece wants 40bn euros (34bn) from eurozone governments and the IMF to shore up its finances.
    But there are fears it will not meet conditions needed to access the funds it needs to make looming debt repayments.
    Any metaphor will tear if stretched over too much reality.

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  • #2
    The EU, World Bank, and the IMF really have NO choice, they MUST cough up the readies to solve this problem, or at least delay it until it can be worked around.

    We have been through this before with the Central & South Americans in Mexico, Argentina and Brazil back in the '80s.


    John.
    The PLO claims ALL of Israel!!! There will and can NEVER be a "2 State solution".

    Comment


    • #3
      Originally posted by ozjohn39 View Post
      The EU, World Bank, and the IMF really have NO choice, they MUST cough up the readies to solve this problem, or at least delay it until it can be worked around.
      Which means the other countries in a similar pickle will realise that they won't be allowed to fail and so won't fix their ways, and the Euro will be in a spot of bother.
      Winnie says
      ---------------------------------
      "He fell out of a Gestapo car, over a bridge, and onto a railway line. Then was run over by the Berlin Express.

      It was an Accident."
      Herr Flick.

      Comment


      • #4
        Possibly, but the main condition of the IMF assistance is that they get to over-see the annual budget, and that means wages and pension freezes, and higher taxes.

        Most government don't like that.


        John.
        The PLO claims ALL of Israel!!! There will and can NEVER be a "2 State solution".

        Comment


        • #5
          Originally posted by ozjohn39 View Post
          Most government don't like that.


          John.
          Never mind the government, wage freezes and higher taxes (or even proper collection of taxes) could be the spark that ignites a wave of public disorder.

          To misquote The Smiths, panic on the streets of Athens!

          Comment


          • #6
            Yep!
            The PLO claims ALL of Israel!!! There will and can NEVER be a "2 State solution".

            Comment


            • #7
              And people wondered when I laughed at suggestions that the Dollar would be supplanted by the Euro as the world currency valuation mechanism.

              Sorry chaps, the US Dollar is still the most secure currency available the world over.

              Comment


              • #8
                An interesting point on the Greek debt

                There are growing calls within Greece, and without in certain quarters, for the Greek government to default on its loans to force the "foreign banks" to shoulder the cost of the collapse. Interestingly enough approx 58% of the debt owed by Greece is to Eurozone banks who have a combined exposure of between 62 and 121 billlion Euros. French banks alone are exposed to the tune of 27-52 billion Euros. What would that do for pensions across the Eurozone? I'm sure a default would do a whole lot for European harmony.

                Comment


                • #9
                  If Greece defaults on its debt, it is only the start in line after them is Portugal, Spain, Ireland, Italy and a little far down the path Britain. All have a huge public debt and unless they make savage cuts to services and living standards they will default too.
                  War is less costly than servitude

                  Comment


                  • #10
                    Originally posted by Legionnaire66 View Post
                    And people wondered when I laughed at suggestions that the Dollar would be supplanted by the Euro as the world currency valuation mechanism.

                    Sorry chaps, the US Dollar is still the most secure currency available the world over.
                    Bernankes money printing machine will maintain the US status quo........for now.

                    Comment


                    • #11
                      Originally posted by kendrick View Post
                      If Greece defaults on its debt, it is only the start in line after them is Portugal, Spain, Ireland, Italy and a little far down the path Britain. All have a huge public debt and unless they make savage cuts to services and living standards they will default too.
                      Britain in to the Euro. What a genius Nick Clegg is!!

                      Comment


                      • #12
                        Originally posted by kendrick View Post
                        If Greece defaults on its debt, it is only the start in line after them is Portugal, Spain, Ireland, Italy and a little far down the path Britain. All have a huge public debt and unless they make savage cuts to services and living standards they will default too.
                        The Difference is the UK isn't a Euro member. The others are.
                        Winnie says
                        ---------------------------------
                        "He fell out of a Gestapo car, over a bridge, and onto a railway line. Then was run over by the Berlin Express.

                        It was an Accident."
                        Herr Flick.

                        Comment


                        • #13
                          Looks like Portugal and Spain are to be downgraded as well. It spreads...
                          "To be free is better than to be unfree - always."

                          Comment


                          • #14
                            Originally posted by Listy View Post
                            The Difference is the UK isn't a Euro member. The others are.
                            That's not going to help them.

                            The bulk of the UK- and US- debts racked up are internal to the likes of bailouts of RBS- and AIG for example, so will need to be eventually covered internally in those currencies.

                            The Euro allows for some national transfers to 'even out' the disaster though I think the Greeks seemed to think of it more than most as a 'piggy bank' for social improvement. Combined with property-related problems worldwide originally, a double whammy. A holiday in Greece or a Greek villa anyone from the UK or Ireland this year anyone? Same for Portugal, Spain, Italy...

                            Trying to make out keeping the was a good thing strikes me as jingoistic crowing when the UK is in one of the most parlous states itself.

                            Clegg's idea is a good one I think depending on what rate the UK can strike at entry as it gets rid of a lot of useless and unnecessary FX-related BS that just hinders international European trade- being able to go to France from Ireland removes a huge headache for me on holiday as prices are transparent, easily comparable and I don't want to spend my time there doing mental gymnastics every time I need something.
                            Last edited by General Staff; 28 Apr 10, 18:44.
                            Tactics are based on Weapons... Strategy on Movement... and Movement on Supply.
                            (J. F. C. Fuller 1878-1966)

                            Comment


                            • #15
                              If these EU basket cases get that bad, I expect some sort of EU/IMF/World Bank guarantee to be put in place.

                              That will still mean some horrific Federal Budgets in the future.

                              Probably the least painful way around it.



                              John.
                              The PLO claims ALL of Israel!!! There will and can NEVER be a "2 State solution".

                              Comment

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