This article is about the latest installment of the Greece debt saga. The Prime Minister this week called for a last-resort debt deal referendum in the hopes of regaining a last bit of political support. He was met with fierce backlash from other political leaders, who are calling for his resignation. His party is losing support in the Parliament and the population. On the world stage, this most recent flare has caused falls around 4% in other European markets, significantly affecting international financial stability as well as domestic matters.
This article, as well as the entire Greek financial crisis, has shown how important the connection between politics and financial markets are. Changes in one will always create changes in the other, due to attitudes and predictions about the future. The Greece crisis should be taken as a warning for Obama, about how important fixing the economic situation is to maintaining political support.
I agree, Greece's situation is a reminder to the rest of the world that economic stability breeds social stability. The U.S needs to take the hint and stop will all this political squabble over who's plan, Republicans or Democrats, will be best for the economy. If the U.S economy dips again, I wouldn't be shocked in the least if riots like those in Greece broke out.
ReplyDeleteKate, I agree with your argument that the situation in Greece is a warning for Obama. A similar situation, although not as grave, seems to be brewing in the US which is likely to affect political stability. There is a resentment about people in terms of unemployment and economic stability which could grow into a political upheaval.
ReplyDeleteAlthough Greece has obviously been living beyond its means, the real problem is the European Union and the euro currency. Both are bad ideas that are doomed to fail as they should.
ReplyDeleteThe unelected eurocrats behind their closed doors in Brussels are generally allergic to public referendums. The European Union exists on a plane far removed from the will of the people. It is an undemocratic, parasitic, arbitrary construct laid over a set of very different cultures, languages and nationalities with histories going back hundreds of years and that have different political and economic priorities.
The euro currency is a political Trojan horse of the eurocrats. A "too big to fail" project to which they point to further political union as the only solution to its problems, thus increasing their own power. The euro was either rushed through without the consent of the people, or as with the PIIGS, sold to them as an easy ticket to prosperity. But, the euro is a rope that ties all of the eurozone together as they roll off a cliff. The euro has proven to be a vector that rapidly spreads the ills of the weakest members of the eurozone to all.
Get rid of the European Union and the euro and go back to currencies issued by the respective sovereign governments. Europe is much better served by a common market established with free trade agreements and treaties between sovereign democracies -- NOT this European Union and euro pipe dream turned nightmare.