Toronto Star: Will Greece set off 'global debt bomb'?

[marmar]

Olive: Will Greece set off 'global debt bomb'?
Threat of new crisis hits shaky world economies

Published On Sun Feb 7 2010

By David Olive
Business Columnist


The inevitable "sovereign debt panic" finally struck last week, causing severe one-day drops in stock markets from New York to London to Toronto on Thursday.

Ostensibly, the epicentre of the crisis is Greece, in danger of defaulting on its debt payments to worldwide holders of its government bonds, or sovereign debt.

But the fear about state defaults quickly spread to Spain, Portugal and Ireland, fiscal train wrecks that together with Greece now go by the unfortunate acronym PIGS.

Even then, the scope of a potential second global financial crisis so soon after the credit crisis of 2008-09 goes far beyond the euro zone, the 16 nations sharing a common currency, the euro.

Last week's dramatics could have been far worse. And they may yet manifest themselves in an ugly fashion in weeks to come if the euro-zone countries don't rescue what Greek Prime Minister George Papandreou described last week as "the weakest link in the euro zone."

Greece accounts for just 3 per cent of the euro-zone economy. The crisis in the cradle of Western civilization serves merely as proxy for government over-indebtedness everywhere. ..........(more)

The complete piece is at: http://www.thestar.com/news/article/761755--olive-will-greece-set-off-global-debt-bomb?bn=1

[Skink]

1. Keep the unrestricted travel but everybody go back to their own currency.

[thereismore]

2. What about Dubai? Haven't heard anything about that lovely emirate lately. nt

[enid602]

3. from the article

"Few nations emulated Canada's example of 11 consecutive budget surpluses heading into the Great Recession." In most countries it is not politically possible to strip mine almost an entire province to raise cash. Shame on you, Canada.

[wolfgangmo]

4. re "In most countries ..."

What, pray tell, are you talking about?

The article mentions that Canada has been running surpluses for 11 years. They are fiscally conservative while still maintaining a social safety net such as universal health care. Ooooooooo. How shameful.

Wait are you talking about the Alberta Tar sands? Considering that Alberta is big enough to swallow Alaska and Texas and have room leftover for desert, don't you think you are being a little facetious about the strip mining comment. (it is an admitted environmental disaster and example number one in what happens when you let oil companies take over a ruling political party in a province).

[enid602]

5. good

Good: it's nice to know that most Canadians don't approve of balancing the budget by sacrificing the environment and worsening global warming. But they do nonetheless benefit from selling off their natural resources. Albeit for only progressive purposes, eh?

[Demeter]

6. Only If the PTB Want It To

and they would lose the most if they did.