{"id":381,"date":"2010-03-23T11:27:00","date_gmt":"2010-03-23T15:27:00","guid":{"rendered":"http:\/\/www.intuitiveinvestor.com\/web\/?p=381"},"modified":"2018-08-20T15:48:47","modified_gmt":"2018-08-20T19:48:47","slug":"the-eu-punts-greece-to-the-imf","status":"publish","type":"post","link":"https:\/\/jasonapollovoss.com\/web\/2010\/03\/23\/the-eu-punts-greece-to-the-imf\/","title":{"rendered":"The EU punts Greece to the IMF"},"content":{"rendered":"

I have been closely\u00a0tracking the debt crisis in Europe for almost two years now.\u00a0 The financial crisis that beset the United States in 2008, and whose effects continue to this day, was much worse in certain European countries.\u00a0 Frankly, the full impact of the crisis has yet to be felt in Europe.\u00a0 The economies of Portugal, Italy, Greece and Spain are all heavily leveraged with debt and each of these nations is teetering on the edge of debt defaults.\u00a0 In 2010 the world has been focused on Greece and its potential default leading to\u00a0a cascading domino effect of doom on the European Economic Union.<\/span><\/p>\n

In particular, Germany, the only truly economically strong nation in the EU has been pressured to bailout the Greeks.\u00a0\u00a0Politically emasculated because they initiated World War II, Germany nonetheless has\u00a0bankrolled the European Union for most of its existence.\u00a0 In the Greek debt crisis Germany seized an opportunity to increase its political heft within the EU.\u00a0 However, the Germans never wanted to bailout Greece.\u00a0 Instead, they wanted to step outside of France’s long EU political shadow.\u00a0 Thus, Germany dictated terms to Greece: undertake budgetary austerity and we might help.\u00a0 Germany also dictated terms to the EU: put in place legal authority within the EU charter for removing a\u00a0member from the union.<\/span><\/p>\n

Why didn’t Germany want to bailout the Greeks?\u00a0 Imagine being an unemployed\u00a0German and your government declines on implementing domestic programs designed to take the local sting out of the global recession because it wants to bailout Greece instead.\u00a0 Germany bailing out Greece was not possible because of domestic German politics.\u00a0 So the Germans have punted to a broader base of lenders\/bail-outers,\u00a0the IMF.\u00a0 The major financial backers of the IMF are the United States and China.\u00a0 So, in typical EU fashion they have demonstrated that they cannot take care of an internal issue and are calling upon the U.S. to help them out.<\/span><\/p>\n

Net, the Germans have demonstrated their willingness to transit out of the post-World War II political slumber; the Greeks have implemented very unpopular austerity measures and may see a mini-revolution; Greek debt still sits poised to default; global financial markets are still nervous; and the IMF is now being looked to as guarantor of a debt situation whose creation it did not supervise in the first place.\u00a0 When will the Europeans learn to wipe themselves?\u00a0 As investors, this is another reason to be nervous about plunging into the financial markets right now.<\/span><\/p>\n

Jason<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

I have been closely\u00a0tracking the debt crisis in Europe for almost two years now.\u00a0 The financial crisis that beset the United States in 2008, and whose effects continue to this day, was much worse in certain European countries.\u00a0 Frankly, the full impact of the crisis has yet to be felt in Europe.\u00a0 The economies of […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[3],"tags":[],"class_list":["post-381","post","type-post","status-publish","format-standard","hentry","category-the-blog"],"_links":{"self":[{"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/posts\/381","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/comments?post=381"}],"version-history":[{"count":0,"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/posts\/381\/revisions"}],"wp:attachment":[{"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/media?parent=381"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/categories?post=381"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/tags?post=381"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}