Article;
http://economictimes.indiatimes.com/news/international-business/greek-pm-ecb-officials-reject-debt-restructuring/articleshow/8497612.cms
Comment;
Greece is hit by recession, therefore, debt restructuring if private investors are not interested due to recession expectations will trouble their assets in the short-run. Budget cuts will further aggravate the situation because during recession fiscal spending is important and privatization, during the short-run, will depend on what private investors are expecting from the government. There is a difference between public and private risk. Both public and private spending should go up and their interplay is expected to do the job. As far as European Union and euro is concerned Greece should concentrate on its own currency against euro because it’s between Greece and Europe, and, Greece and World as far as foreign trade is concerned. Bailout or quantitative easing is a good idea but its effectiveness depends on Greece’s currency, their magnitude, and Greece’s capacity for internal inflation, and inflation within Europe. Revenue shortage is normal since we are in recession with low economic activity but that would automatically go once the economy catches it economic growth, at-least 5%.
http://economictimes.indiatimes.com/news/international-business/greek-pm-ecb-officials-reject-debt-restructuring/articleshow/8497612.cms
Comment;
Greece is hit by recession, therefore, debt restructuring if private investors are not interested due to recession expectations will trouble their assets in the short-run. Budget cuts will further aggravate the situation because during recession fiscal spending is important and privatization, during the short-run, will depend on what private investors are expecting from the government. There is a difference between public and private risk. Both public and private spending should go up and their interplay is expected to do the job. As far as European Union and euro is concerned Greece should concentrate on its own currency against euro because it’s between Greece and Europe, and, Greece and World as far as foreign trade is concerned. Bailout or quantitative easing is a good idea but its effectiveness depends on Greece’s currency, their magnitude, and Greece’s capacity for internal inflation, and inflation within Europe. Revenue shortage is normal since we are in recession with low economic activity but that would automatically go once the economy catches it economic growth, at-least 5%.
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