An In-Depth Analysis of the European Debt Crisis

908 Words4 Pages
Abstract In this paper, we present an in-depth analysis of the nature, causes, economic consequences, prevention as well as control of the European Debt crisis. A definition of the debt crisis is also provided. Recommendations on the way forward are also provided. Introduction Debt crisis is noted by Pescatori and Sy (306) to be a term that had before 1990s been used to typically refer to defaults in debt serving. This definition however became very problematic with the emergence of the sovereign bond markets. Debt crisis therefore generally deals with nations as well as their ability to repay loans that they had earlier borrowed. The concept therefore deals with international loans, national economies as well as national budgeting. An accurate and definition of debt crisis does not exist since no standard definition has been advanced. The definitions of the term have generally been noted to have varied over time with various institutions like the International Monetary Fund (IMF) as well as Standard and poor (S&P) providing their own views. The most basic definition and one which is generally accepted indicates that "debt crisis" is when a national government is not able to repay the debt that it owes as therefore resorts to seeking of some forms of assistance. The European Debt Crisis The European Debt Crisis is a term used to describe the region's spirited struggle to repay the debt that it had borrowed in the recent decades. Five main countries in the region
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