The Crisis Of Greece And Destabilize The Union

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.

Being unaware about issues on the other side of the world made me realize on intriguing economic debt crisis that is going on in countries that seem like they are holding together. Greece and the European was a great issue to discuss and view both sides before since I was unaware that there was a long going crisis going on in this side of the world. Greece can either get a so many bailouts repeatedly or they can fend for themselves to find how the country is able pay back the debt they owed the EU within the past years. In my opinion, I think that Greece should give the money from the EU to survive.

The sovereign debt crisis in Greece has attained several controversial bailouts which has caused a huge fuss to the Greek citizens and the tension of political instability in negotiation in the Eurozone. This literature review tends to answer 3 main questions as follows: (1) the causes of sovereign debt crisis in Greece, (2) the implication of the crisis currently and (3) the ways of mitigating the

In 1999, ten European nations joined together to create an economic and monetary union known as the Eurozone. Countries, such as Germany, have thrived with the euro but nations, like Greece, have deteriorated since its adoption of the euro in 2001. The Eurozone was created in 1999 and currently consists of eighteen European nations united under the European Central Bank and all use the euro. The Eurozone has a one point six percent inflation rate and an eleven point six percent unemployment rate in 2014. Greece joined the Eurozone in 2001 and was the poorest European Union member at the time with a two point six percent inflation rate3 (James, 2000). Greece had a long economic history before joining the Eurozone. The economy flourished from 1960 to 1970 with low inflation and modernization and industrialization occurring. The market crash in the late 1970’s led Greece into a state of recession that the nation is still struggling with. Military failures, the PASOK party and the introduction of the euro have further tarnished Greece’s economic stability. The nation struggles with lack of competitiveness, high deficit, and inflation. Greece has many options like bailouts, rescue packages, and PPP to help dig it out of this recession. The best option is to abandon the Eurozone and go back to the drachma. Greece’s inflation and deficit are increasing more and more and loans and bailouts have not worked in the past. Leaving the Eurozone will allow Greece to restructure and rebuild

The economic crisis of 2008 in New York had ripple effects around the world, causing deep structural problems within the European Union to crumble the economies of several countries. These countries, known as the PIGS, are made up of Portugal, Ireland, Greece, and Spain, and collectively hold most of the sovereign debt problems of the European Union. After fast growth early in the decade, these countries were spending too much money and not securing their own banking sectors with enough capital. Soon, the debt the PIGS owed caused massive problems throughout the EU, and Germany and France had to come to the rescue of these poorly managed countries. (Greek Crisis Timeline, 1) Now, in 2012, the issue has yet to be fully resolved. Greece is still sinking, and a massive bailout for Greece's banks is required. The debate is whether Germany should continue bailing out Greece and collecting interest on its loans, or whether Greece should try to separate itself from the broader European Union, in an attempt to manage its own finances and declare bankruptcy in order to save itself from crippling interest payments. Each path offers an escape from the present situation that Greece finds itself in, but only the path of bailout results in a harmonious European Union. If Greece fragments off from the EU, then the entire union is weakened as a result. I believe that Greece should accept the terms of the bailout that Germany has provided, and should undergo several years

GREXIT: The Real Possibility of Greece Exiting the Eurozone in light of the Legislative Elections

The Greek debt crisis has been an ongoing problem officially beginning in 2009, but later discovered to have begun in the 1990’s, and what began as a national disaster has quickly spread to become a worldwide catastrophe. The steady income of many Greeks has declined, levels of unemployment have increased – to the highest in the EU - Elections and resignations of politicians have altered the country 's political landscape radically, the Greek parliament has passed many austerity

He was one of the most pivotal figures within the Greek political cabinet and now he has seemingly turned his back on the Greek economy. The new country reforms have been discussed by former Finance Minister Yanis Varoufakis, in which he has said that the new reforms are "going to fail", with the programme set to "go down in history as the greatest disaster of macroeconomic management ever". These are strong words from a man who once oversaw the financial direction of the Greek economy.

The purpose for this paper is understand why & how the Greece ended up with the worst debt crisis of our lifetime. Other objective of the paper is to analyze its historical reasons, and the challenges of the European Union, Europe and the world economy to the Greek crisis.

This time is different: Eight Centuries of Financial Folly, written by Carmen M. Reinhart and Kenneth S. Rogoff, was published just before Greece went into crisis. Just as they satiric title illustrated, so most people believe that Greece will never default again because “this time is different due to the wealthy ally within the EU”, but the Greece crisis came out immediately and strongly prove Reinhart & Rogoff’s statement “this time usually isn’t different and catastrophe eventually strikes again”.(journal1) This book is designed to cater to the desires of many governments that are enthusiastic about austerity and becomes the most influential economic analysis book around recent years.(paul letter2) In this essay, I will give a brief view of Reinhart-Rogoff’s theory and explore some criticisms of R-R’s work, and then summarizes their defences against those criticisms.

The introduction of the euro also allowed Greece to borrow money due to the lowered interest rates. In 2008 when the global financial crisis took place, two of the country’s largest industries, tourism and shipping, were badly affected. This resulted in the countries revenues dropping by 15%, and the beginning of a fall into an irrecoverable debt. In order to keep within the monetary guidelines of the EU, Greece has been discovered to have deliberately misreported the official economic statistics of the country. It was found that Greece paid banks, such as Goldman Sachs, hundreds of millions of dollars to hide the true level of borrowing which took place (ABC News). This then enabled Greece to spend beyond what it was ‘permitted’ to, and hiding the actual deficit from the financial leaders overseeing the spending of the EU countries. Due to this over-spending and running on a false economy, Greece has plunged itself into an incomprehensible debt worth 113% of their GDP, which is equivalent to over $250 billion (CIA World Factbook). As Greece was without a bailout agreement, it was likely that they would have to default on some of their debt, meaning that it would not be paid on time, and potentially not paid at all. Economic analysts stated that there was somewhere between a 25%-90% chance of them being forced to default. This would result in Greece only paying back 25%-50% of what they owed, and this would effectively remove Greece from the euro, as they would no

The unintended consequences of the Greece’s crisis are of a great extent, yet it has a small economy, responsible for only 2.4% of the total Euro zone GDP. Essentially, Greece’s crisis has disclosed some uncertainties communicated and created by a group of different countries sharing a common currency and monetary policy, while maintaining national fiscal policies. It has one of the biggest budget deficit and the highest levels of public debt in the Euro zone. It was the first to turn to other Euro zone member states financial backing and the first to come under extreme market burdens.

Today, Greek banks are closed and citizens are unable to withdraw funds from ATMs in excess of 60 euro a day. The country is on the brink of an exit from the EU and negotiations are floundering. There are those who argue that Greece has a long history of default and bad credit - according to economists Carmen M. Reinhart and Kenneth S. Rogoff "Greece has spent more time in default to its creditors than any other European country" (Lynn, M., 2011). This suggests to some that allowing Greece to join the EU was simply a bad idea and it is time for them to leave Europe and join with Turkey and Cyprus in a union that would solve the unemployment crisis and get them producing goods and on-track to stability (Asa_El, A.,

There was a downgrade of the Greek government in April 2010 that alarmed the financial markets. Bond yields rose so high that private capital markets were no longer an option for Greece as a support foundation. In May 2010, the Eurozone countries and the International Monetary Fund gave Greece a “bailout loan” of $110 billion, conditional on compliance with 3 conditions 1.)restore fiscal balance 2.) privatization of government assets worth $50 billion by the end of 2015 to be sustainable 3.) to improve competitiveness and growth prospects. Sadly, Greece worked slower than expected and they needed another year offer and more

What are the reasons unions and organizations are formed? Unions and organizations are formed to create solidarity, support, and overall continuity among its members. Unions and organizations can range from economic unity to political reasons. The European Union and the International Monetary Fund were formed on the basis of improving and assisting its members to avoid a chain reaction of ruin throughout the global economy as well as throughout its member states. Greece, a member of the European Union, has been in a controversial and precarious position in recent years with threats of leaving the European common currency in addition to receiving financial assistance from the