Standard & Poor grades Greek economy as junk
In another blow to the European recovery, Standard & Poor has now downgraded Greece to a junk nation. While this may not come as a surprise, the effect may become bigger than expected.
Greece has severely harmed the EU recovery and in a way also the EU formula. In breaking the rules and misleading their fellow members, the Greek authorities have put EU before a legislative ultimatum. EU will either have to tighten the rules, which equates to even more centralized governing. Or they will have to loosen the whole EU concept and revert back to trade cooperation. This may sound overboard but the implications of the Greek finances will reverbate deep and long.
It is commonly understood that EU has been “lenient” on the newer members from the eastern block, and if Greece has been able to corrupt the game, so can the newer nations. The Icelandic volcano may be nothing compared to the fallout from a revelation of just how slack the financial restraints are in the member nations with a cultural heritage of doing things their own way.
Corruption is not a new term and has been allowed to remain in the social fabric of some parts of EU. If this leads to severe impact in the European Union is yet to be seen, bu we expect more to come because apart from the newer members whose financial accouting sometimes seems “confusing” you need perhaps no farther than Italy to unearth the next hotspot.
Related posts:
- Another Greek bailout bleeds the Eurozone dry
- Dow stumbles on expected Bernanke statements
- US Futures down on Greece is Spain next?
- World Economy – Ready for the Big Bang?
- Greece gets help from EU in more trouble
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