May 11, 2011 - We paid some attention to this yesterday in our post "
S&P Lowers Greek Credit Rating; Slumping UK Growth Forecast?" Today, the
feta is hitting the fan as the financial crisis, complete with riots, in Greece worsens.
The euro dropped against most major currencies on speculation European leaders are slowing the drive to grant Greece additional aid, fueling concern the nation may be forced to restructure its debt. The pound surged as the Bank of England said U.K. inflation may reach 5 percent this year. More at BusinessWeek...
There has been talk of Greece pulling out of the Eurozone altogether, which would be foolish in the long run. To do that would be to pull the rug out from under the very people - their fellow Eurozone members - who have invested billions in their bailout. It would weaken the European economy so badly that it would drag Greece down with it. On the other hand, however, I could be wrong.
"For countries like Italy and Greece," writes Jacob Wolinsky at
GuruFocus.com, "having the benefit of gaining from the healthy competition within the European Union was out of the question since the beginning, as their economies were not in sync with those of more powerful countries like France and Germany."
They're all screwed, most likely, and many Greeks have been
stashing their own money outside of Greece for some time now, fearing a crash of the euro. For those who have kept their cash in Greece, or themselves for that matter, they have this to deal with today as listed by
The Daily Mail:
- Petrol bombs, stun grenades and tear gas thrown during clashes in Athens
- Government aims to sell off casinos, marinas and former Olympics venues to service debt
- Greece could require second bail out of 60billion euros
- Demonstrations against harsh austerity measure boil over into riots
Good luck, Greece. Good luck, Europe. The fruits of your decades of crazy acid trip spending are now falling all around you. It's a bitter, rotten fruit.
