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Eurozone teeters on the verge of a 'euroquake' if Greek default is bungled

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posted on Oct, 1 2011 @ 08:48 PM
Sou rce

More than one in three international investors expect a global economic meltdown within the next 12 months, according to a new Bloomberg poll. Far more - almost 70pc - say the world economy is deteriorating, up from just 18pc four months ago.

At the heart of the gloom, of course, is the eurozone, with 90pc of those surveyed judging that the economy of the single currency area is getting worse. One wonders what planet the other 10pc are on.

The eurozone is clearly sliding. The European Commission's economic sentiment indicator fell to 95 in September, from 98.4 the month before, plunging at a rate not seen since the Lehman Brothers collapse. German retail sales dropped faster in August than at any time since May 2007.

The eurozone – an economy second in size only to the US – is on the brink of a double-dip recession.

This grim prognosis, though, is set against a more hideous backdrop – the danger of a "euro-quake". Greece will default. The only question is how the default is managed – indeed, if it is managed at all.

A bungled Greek payment failure will spark "contagion", as spooked creditors pull the plug on some big eurozone government, leading to non-payment of wages and benefits, serious social unrest, and a single currency break-up.

We face the very real prospect of a major economic shock, the negative impact of which will be felt around the world.

"The operational viability of the single currency won't be known until the system is tested by a serious downturn and that moment may come soon," this column warned in December 2007, as the credit crunch began to loom. "The ultimate victim of this sub-prime crisis could be nothing less than the single currency's existence."

Cited in part only, Have a look at these poll results. A third of international investors anticipating a global economic meltdown within the next year? That's very significant, but also quite amazing is the increase in those polled who see the global economy deteriorating, from 18 per cent to 70 per cent in just four months! No wonder the markets are behaving the way they have been this past quarter.

posted on Oct, 1 2011 @ 10:10 PM
Just another nail in the coffin it seems the collapse is inevitable in the minds of a large percent of the whole world!
What pray tell would be a badly managed default?As compared to a well maged one?
The greek default is cited a the key to a few other countires gowing down as well....
No matter how it is handled these other counties will expect the same or better treatment wont they?
The eurozone may not be rich enough to do this for every country that spent its way into bankruptcy......
No matter what. europe is toast for a good long while economically.
If they arent in austerity measures now, they all will be for a good lomg time to cover the losses.

posted on Oct, 1 2011 @ 10:15 PM
I know this is coming, and I must try harder to disengage from this consumer infinite growth driven paradigm.

I just bought a 60'' plasma TV... all the while knowing a major recession and probably depression is right around the corner. It's hard to shake the materialistic brainwashing us westerners have been given.

I may return the tv and get my cash back and hold onto it, buy seeds and food, books on permaculture and gardening

posted on Oct, 1 2011 @ 10:39 PM
It's the US you people have to keep an eye on. Any problem that may arise will come from the collapsing dollar, not the euro. Believe me when I tell you that nothing will happen to the eurozone apart from growing stronger, more resilient and more centralised. That's what's gonna happen.

I can't say the same for the dollar.

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