Posted on 04/15/2011 8:31:21 PM PDT by bruinbirdman
I’m not sure why everyone thought comments the other day from the German Finance minister, Wolfgang Schäuble, to the effect that Greece may eventually face a sovereign debt restructuring, were such a revelation. This is in fact only a statement of the blindingly obvious, has been apparent in the market price of Greek sovereign debt for more than a year now, and was in any case implicit in the statement issued after the European Council meeting of March 24-25, when ministers said restructuring would be a pre-condition to borrowing from the European Stability Mechanism if debt was judged to be on an unsustainable path.
Even so, combined with the latest Moody’s downgrade on Friday of Irish sovereign debt, his comments have sparked a fresh round of jitters in markets, and led some commentators to think an act of default among the peripheral eurozone economies is imminent. I don’t doubt that certainly Greece, and possibly Ireland and Portugal will eventually have to restructure, but here’s why it’s not going to happen any time soon.
First and most important, none of these countries are yet willing to contemplate such a radical course of action. It’s possible that political developments in Europe could force such an outcome on them sooner rather than later; there is every chance, for instance, that Sunday’s election in Finland could produce a government hostile to any future bailouts, and therefore scupper the proposed Portugese rescue before it’s up and running. Things might quickly unravel if Finland refuses to take part in bailouts.
But assuming that doesn’t happen, it’s most unlikely that Greece, the most vulnerable of the four PIGS, would want voluntarily to restructure before the ESM comes into existence in 2013. That’s because it is neither in Greece’s interests to restructure before then, nor in any body
(Excerpt) Read more at blogs.telegraph.co.uk ...
ping
I think Ireland already went to market -- RIP.
It will soon be US PIGS, take a look at that chart. We’re almost there dude.
Good article, thanks for posting. I’d like our elected representatives to read this and then look their constituents in the eye and then defend more debt and higher spending.
BTW, from the chart,... Italy’s 2011 gross debt percent of GDP is 120.3.
Bleak news...
yitbos
Shame on “other people” that are not giving them any more money. :)
...Greece may eventually face a sovereign debt restructuring... Moody's downgrade on Friday of Irish sovereign debt... fresh round of jitters in markets... certainly Greece, and possibly Ireland and Portugal will eventually have to restructure... it's not going to happen any time soon... Sunday's election in Finland could produce a government hostile to any future bailouts, and therefore scupper the proposed Portugese rescue... Things might quickly unravel if Finland refuses to take part in bailouts.And give or take a war of intervention by NATO...
Pah....that’s nothing...wait until the US defaults.....
When the entire world’s economy is looted and destroyed by Soros and his evil minions, over what do they expect to rule?
A ton of poor people who have been reduced to pre industrial revolution living standards and a small elite. Then they plan to get rid of as many of the poor as they can. It’s all in their own white papers. Population reduction is one of their main objectives.
Indeed, but a thriving populace is the source of their income. If they drive us all into penury and kill us off, it will be mutually assured destruction. They will have wealth, nothing else, and no way to acquire any more.
They’re insane.
No one said it was sane. It's certainly evil and though I am not a religious person living through these times makes me question my assumptions.
[nodding]
Indeed.
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