George Papaconstantinou, the Greek Finance Minister, is now gong after speculators as the problem. They will not buy Greek debt at cheap levels! With riots in the streets who is willing to take a chance on the debt reduction policy which will try and reduce the debt to GDP level from 12.7% to 8.7%?
There have been announced some severe austerity measures including a increase in the VAT tax from 19% to 21%, higher taxes on some items, pension freezes, and 30% cut in bonuses.
The roll in debt will be around $27 billion in the next two months which will be the critical time for bond markets. Of course, the deal with get done. There will be a price to clear the markets but it will not be near the credit rating of Greece and ill be closer to junk.
The French have offered more support but without coordination with Germany it is hard to say that we will have a workable solution. Greece may have to turn to the IMF for standby loans.
There have been announced some severe austerity measures including a increase in the VAT tax from 19% to 21%, higher taxes on some items, pension freezes, and 30% cut in bonuses.
The roll in debt will be around $27 billion in the next two months which will be the critical time for bond markets. Of course, the deal with get done. There will be a price to clear the markets but it will not be near the credit rating of Greece and ill be closer to junk.
The French have offered more support but without coordination with Germany it is hard to say that we will have a workable solution. Greece may have to turn to the IMF for standby loans.
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