Daily Archives: June 29, 2011

Greece crisis – disaster is delayed a bit

Pending the vote of the Greek Parliament in Athens have been several clashes between demonstrators and the thousands of police, after which at least 37 people were injured and 14 were detained by police. Riot police use tear gas against demonstrators gathered in central Athens. People are chanted “Psomi, paideia, eleftheria” which translates as: “Bread, education, freedom” – a slogan that dates from the dictatorship of Papadopoulos which ended in 1973. Anarchists attacks could worsen following a positive vote in Parliament.

I cannot avoid to notice disgusted: politicians remain politicians even on the brink of chasm – always other are guilty. Greek PM started his speech before the vote with a condemnation of the previous government’s (under the New Democracy party) working situation with Europe. And opposition leader felt the need to answer the charge. 😀

Finally, the Greek Parliament decided: the austerity bill was accepted with 155 Yes votes. The vote in Parliament on the draft austerity was crucial for further international financial aid for Greece and for the euro area which was in danger in case of failure. But there is poignant view among economists that with or without positive vote have only a postponement of the disaster.

Analysts say that Greece equally Argentina Reloaded. The difference is in Greek debt figures, which are much higher than those of Argentina for two decades ago. The events in Greece have the potential to completely change our world and not necessarily a positive change. Many analysts speak of a matter deficits Greece absurdly high public spending, arguing that there can be identified root of evil. But it is very likely not at all. The current crisis is not necessarily of Greece, but rather the banking system. Even if political leaders are reluctant to declare it systematically, preferring to point to the Greek government. From time to time, world leaders gather at international summits and forums where before the cameras they say sententiously that things have changed in the global financial system. And that’s all.

Bankruptcy Greece and exit from the euro area or a new financial aid (who, what, from where ?) are two equally bad options. EU commissioner Olli Rehn insisted that «there is not a plan B». But even the solution is as always to choose the lesser evil just for to delayed the same end ?

However, if the information below is confirmed, the equation is changing rapidly and radically. Germany prepares its exit from the euro area, shown in a paper published by the British Daily Express, took over the International press, showing that Germany’s central bank had started to print again DM. Notice that yesterday Chinese Premier Wen Jiabao attended at Chinese-German economic forum in Berlin and after met Chancellor Angela Merkel at her office. The discussions agenda of the two leaders also was sovereign debt crisis and in special the situation in Greece.

How to survive the coming end of the euro zone – an interesting vision by Mattew Lynn can be read here.