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Will a hidden link between the Greek debt situation and the U.S. banking system ignite the next global credit crisis?
The odds of the "next" global credit crisis are increasing with each new day, and with each new revelation. And escalating fears are hitting worldwide stock markets hard.
One in three Greek workers is employed by the government. As austerity-mandated layoffs have progressed, Greece's unemployment rate has zoomed from 11.7% in the first quarter of last year to the record 16.2% rate recently reported.
And given that government spending is still at 46.8% of gross domestic product (GDP), additional budget cuts will be coming - meaning Greece's national jobless rate is certain to increase.
So is the national anger level.
Originally posted by marg6043
reply to post by thoughtsfull
I know, no wonder our president seems so interested into bailing out Greek, actually he is trying to keep the American people from finding out how bad linked to Greek economic our too big to fail are.
Incredible. After three years our economy is not better than the day it fail.
edit on 17-6-2011 by marg6043 because: (no reason given)
European banks, including German ones like Deutsche Bank, hold many billions of euros in Greek government bonds, and the banks would lose big if those debts were restructured. For the moment, Europe’s solution for Greece is, essentially, Mr. Ackermann’s: more bailout money and more austerity — an approach that some economists say only buys time without offering any hope of recovery
Curiously though, the total exposure of banks in the United States is higher than German banks, as I have already pointed out. US banks’ total exposure of Greece amounted to around US$41 billion. But the kind of exposure US banks have are rather different.
Originally posted by vkturbo
They could just abandon the Euro and start their own currency might screw the Euro but might keep employment up and if you know what your doing you can sort out the debt resonably easy
U.S. banks face “a whole lot less” risk to a Greek debt restructuring or default than implied by the almost $33 billion in “guarantees extended” listed in a recent report by the Bank for International Settlements, according to Glenn Schorr, an analyst at Nomura Holdings Inc.
The $32.7 billion figure, which made up the majority of “other potential exposures” of U.S. banks to Greece listed by the BIS as of Dec. 31, doesn’t include hedges or collateral U.S. banks have in place on those guarantees, Schorr wrote today in a note to investors.
Originally posted by Pervius
Has there ever been 1 country on Earth that ever sustained itself with only a private sector economy?