希腊债务危机的新进展

Greece has been talked about. We’ve heard that they’ve rejected the deal. That is something that we would like to know a little bit more about. And also fears over Italy.

Yeah, great fears over Italy. There is a growing sense of urgency really here within the European Union. They’ve called another meeting for Friday. This is an emergency meeting coming of course after Italian assets are now being targeted by the markets. There is a real risk now, of this contagion from Greece.

We have already seen the effect it had of course on Portugal and Ireland as well, spreading to bigger Eurozone scalps, Italy of course. We know, of course that the Italian finance minister, he left this meeting early heading back to Rome to try to sort out the austerity package to try and get things moving again. It seems to have had some effects on the markets, but still a great deal of volatility. The problem that Italy faces of course is that it has this enormous pile of debts, the cost of borrowing is rising, it’s having to force through this austerity package. This political instability in the country, we all know about the scandals and the criminal cases surrounding Silvio Berlusconi. And people are starting to scratch their hands. They are looking around at other countries like Greece, and thinking, perhaps, just perhaps, Italy won’t be able to dig itself out of this mess.

Now the effect on the rest of the Euro Zone of course would be absolutely catastrophic. But this is not just an economic crisis. It is also a political crisis of the European Union and the single currency. Reeling back of course to Greece, they’ve been discussing the second bail-out. They are now seriously, according to my sources within the Europe Union, looking at the possibility of a default. They won’t call it that. What they'll try and do is roll over Greek debts, try and get another preferable rate on the cost of that borrowing, and just basically defer the payment.

But what’s happened so far is the markets haven’t been reassured by that tactic. What the EU’s elites are doing at the moment is treating it as something of an insolvency crisis, bail the country out, give them more money and then hope that they can get things back on track at a later day. But actually what the markets are doing is looking at that and saying:"well, it doesn’t really seem like a very fitting solution to the magnitude of the problem." So I think there still is an enormous problem that European Union has to grapple with. It is not gonna go away, they’ve got this other meeting on Friday. But I'll suppose just watch this at space really.