A Brief Note On The Greek Debt Crisis

The Troika, made up of the International Monetary Fund, European Commissions and the European Central Bank have the most to lose in this debt crisis as they own 78% of Greek debt. With so much to lose we have seen European “bailout” agreements that mostly front the Greek government more money coupled with crippling austerity in an effort to “rebuild” the economy. Austerity discourages growth as it cuts the spending of the government who is by far the biggest spender in the economy. The effects of austerity can be devastating, but the true effects are often hidden beneath the messages we get from mainstream news sources. The stereotype of the Greek people as lazy and tax evading has desensitized the public and has made austerity seem like more of a sensible option. The media messages have made strict austerity measures seem justified and in effect have hegemozined the Greek people.

Ever since Greece joined the Eurozone their economy has been falling apart. Greece was the last country to join in 2001. The euro replaced their modern currency of the drachma. Today Greece is still trying to fight to pull out of the deep and horrid debt they are in. Greece could become the first country to leave the Eurozone, due to its struggling economy and financial crisis, leaving the European Union in debt while helping Greece crawl out of their terrible nightmare.

The Golden Age of Greece is well known for its sculptures, buildings, rulers, and philosophies. Today, modern Greece is known for having economic crisis's as well as political turmoils. Greece's problems began when they joined the European Union. Greek drachma was officially replaced by the euro when they joined. Greece approved the euro in 2001, not knowing what they were getting in to. When the Prime Minister Konstantinos Karamanlis came to power he realized that the budget deficit was not 1.5%, but 8.3%. That outstanding amount greatly hurt the economy. By 2008, Greece's tax collection crumpled and unemployment was at an all time high. Unfortunately, by 2014, 30% of Greek's population did not have a job (Greece Debt Crisis). In contrast, today's Greece is a complete different from the Golden Age. Greek unemployment soared as austerity took its toll.

Ever since the end of 2009, Greece has been involved in a financial and economic crisis that has been record breaking and shattered world records in terms of its severity and worldwide effects. The Greek government, since the beginning of the crisis, has attempted to take several governmental measures to try and “stop the bleeding,” including economy policy changes, dramatic government spending and budget cuts and the implementation of new taxes for citizens. In addition to this, the government has tried to alter the perceptions of Greek government and economy by the rest of the world in an effort to appear both more liberal and more democratic. Greece has also been working to privatize many previous

Greece’s financial issues have always been apparent, but now it’s becoming impossible for the government to hide their financial issues.

The roots of Greece’s economic problems extend deep down into the recesses of history. After the government dropped the drachma for the euro in 2001, the economy started to grow by an average of 4% annually, almost twice the European Union average. Interest rates were low, unemployment was dropping, and trade was at an all-time high. However, these promising indicators masked horrible fiscal governance, growing government debt and declining current account balances. Greece was banking on the rapid economic growth to build upwards on highly unstable foundations. In 2008, the inevitable happened – the Greek debt crisis.

The Eurozone debt crisis has been and continues to be a hot button topic in the economic and financial world with Greece at its center. As the possibility of the first default by a country in modern history looms over Greece there are a multitude of questions to be answered. This paper will focus on the effect joining the euro had on the Greek current account deficit. Was there a deficit problem before Greece joined the Eurozone in 2001? How did Greece’s deficit change after joining the Eurozone?

Greece government’s debt has been around since 2010. The countries surrounding Greece are now worried that it may affect them. The economy in Greece started getting worse after United Stated had its crisis in 2007. Since Greece entered the Eurozone changes in the economy, financial stability, and employment had caused Greece to go into more debt, but it could have been avoided if Greece would have not entered the Eurozone.

According to the Central Intelligence Agency, located at the southern end of the Balkan Peninsula, including more than 2000 islands in the Aegean Sea and the Sea Ionic, with an area of 131,957 square kilometers and 11 million people, Greece, a European nation, exists, with a political parliamentary republican structure established since 1974 (CIA, 2014). Furthermore, and relevant to this analysis, more than half of Greece’s economic industry is concentrated in the metropolitan area of the capital, Athens, with activities dedicated in its majority to agriculture, tourism, construction, among others.

Many foreign as well as Greek economists of the time warned that the existing economic system needed to be repaired, and that the change to the Euro would only delay the inevitable outcome. I remember watching the news and noticing that there were demonstrations by Greek citizens against this move, but the world and the European banks largely ignored the warning due to greed of their own. There were billions to be made in the form of interest and signing bonuses.

Since 2008, the Hellenic Republic (Greece) has been suffering from one the worst economical and financial depressions in its history. From its beginning, the nation 's banking system has teetered on the brink of collapse and over 20% of its citizens have been unemployed. This essay will discuss the history of the crisis, its causes, and comparative study between Greece 's economic situation with that of the United States. The paper will close with my future predictions about Greece 's response to the crisis based on experiences I shared with friends and family members in Greece.

Although a commonly accepted view is that the hidden budget deficit in Greece is the beginning of the European sovereign debt crisis, the real causes of this economic crisis can be various. To reveal the whole event, a comprehensive review of the background is

With the collapse of the Wall street financial market in 2008, Greece become the center of Europe’s economic crisis. With employment rates more than 25 percent, Greece is suffering from a financial crisis equivalent to if not greater than the U.S. Great Depression. The source of the crisis originated in the inefficient management of the Greece’s economy and government finances. Additionally, Greece’s involvement in the euro zone reflected a monetary policy that was at odds with its fiscal policy. The crisis resulted in troika providing emergency funds to pay off Greece international loans.

Subsequently months after being out of the limelight, Greece has just returned to the forefront as an imminent reimbursement deadline on its latest consignment of rescue-package loans. Greece’s relations with Europe are in a delicate state, and quite a lot of it is significant. The origins of the existing emergency were propagated over 20-30 years ago, and the present condition is just the indication of the essential complications that have not been fixed. Basically, Greece was jammed in an inflationary spiral which would only remain in the absenteeism of trials undertaking the original difficulties facing the Greek economy. Greece became the focus of the dues after the catastrophe of Wall Street crumbled in 2008. In 2009 it was said that

The situation in Greece is really catastrophic. It almost seems as if Greece is between a rock and hard place. The government has been spending carelessly for decades coupled with the manipulation by banks and controlling assets, the country was like a volcano ready to erupt. So, when the recession in 2008 finally hit, Greece didn’t have the capability to solely raise their way out like the rest of the countries in the Eurozone. You would think if they printed more money this would solve the problem but Eurozone would allow such a thing. So, the government legislated tax inflation and expenditure cuts but couldn’t get