Euro zone finance ministers gave Greece two weeks from Monday to approve stricter austerity measures in return for another 12 billion euros in emergency loans, piling pressure on Athens to get its ragged finances in order.
European finance ministers meeting Sunday in Luxembourg moved toward approving a fresh quarterly installment of Greece's €110 billion ($157 billion) bailout loan, but they remained divided over the details of a far harder task—extending Greece a giant new package that would support it for years to come.
Greece's debt crisis may be contagious and poses one of the biggest risks to global financial markets alongside Middle East uprisings, Citigroup's Chief Risk Officer told Reuters.
Athenians used to stop off at Syntagma Square for the shopping, the shiny rows of upmarket boutiques. Now they arrive in their tens of thousands to protest. Swarming out of the metro station, they emerge into a village of tents, pamphleteers and a booming public address system.
Moody's cut its rating by three notches from B1 to Caa1 - just five notches short of default.
I've hardly been alone, but that's no excuse. For more than a year now, I've been regularly predicting the euro crisis's final denouement, yet still it hasn't arrived.
There is a similarity between what happened in the U.S. and Europe during the last credit crisis. The similarity is that “junk” countries, “junk” companies (including, especially, banks) and “junk” consumers got access to far too much credit at far too low a price. They had such access because governments supported this undue extension of credit, directly or indirectly.
Yesterday the world witnessed a new and more severe outbreak of violence in Greece. Youths and union members clashed with police in a riot complete with tear gas, flash grenades, molotov cocktails, and tens of thousands of protestors.
What, exactly, were they rioting about? The answer is actually quite simple. They don't like the austerity being imposed on them by a government desperately seeking to find some sort of fiscal discipine, something to which neither the government nor the public sector workers are accustomed.
Bernie Maddof ran a Ponzi scheme and is now in jail. If you are a government official and run a Ponzi scheme, you get reelected. If you are really bad at it, you are working for Greece. If you are really good at it, you are working for the U.S. government.
In a recent article by CNNMoney/Fortuney Magazine , the investment research firm Hedgeye asks the question if the United States debt should be down grated to junk status. We have discussed such a thing ad Nauseum, but find it interesting that main stream media is finally catching on.