"We are in a very major crisis that has even broader implications than the credit crisis two years ago. The politicians have not yet twigged to this."Spain is racing to quell rumors that it isn't following in the footsteps of Greece. I guess we will see.
Ms Zemek [head of global fixed income at AXA Investment Managers] said the rescue had bought a "maximum" of 18 months respite before deeper structural damage hits home, with a "probable" default by Greece setting off a chain reaction across Southern Europe. "It would be the end of the euro as we know it. The long-term implications are at best a split in the eurozone, at worst the destruction of the euro. It is not going to end happily however you slice it," she said.
And of course there is the issue that since government (in this case the EU) raced to do "something/anything" they probably didn't do the right thing.
In the case of Greece the joint IMF-EU policy will increase Greek public debt from 120pc to 150pc of GDP by 2014, arguably making matters worse."I'm from the government and I'm here to help" doesn't sound any better in French than it does in English. Not that Brussels wants to make the hard choices. (They put the kibosh on any real change in the situation in Greece.)