Merkel knows that Greece is fubar and that financial aid to Greece is not going to change that. Merkel/Germany is looking to minmize the national default domino effect that will likely happen within this year (look at the economic situations in Spain, Portugal, the UK, France, Poland, etc., etc., etc.).
Did you see Greece’s plan for cutting the deficit? They are counting on extra revenues from tax increases. Seems like sort of a pie in the sky kind of thing when their economy is a mess to begin with and all the rioting isn’t helping matters. Additionally, a government can only tax so much before it becomes counter productive, creating black markets and like kinds of evasions.
I read a story about this a few days ago where some Greek officials were saying that Germany owes them money because the Nazis looted all their gold and never paid it back. I was pretty sure at that point a story like this was forth coming.
I agree. Greece is “fubar.”
But the Greek SOCIALIST govt promised to cut spending. How could the other Euro types not believe them?