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Monday, August 20, 2012

Greece's Bottomless Pit

The Greek Prime Minister, Antonis Samaras, will meet with various Eurozone leaders during the coming week in order to beg for more time (an extension of two years) for Greece to try to enact its austerity programme.

His renegotiation mission comes on the eve of next month's Troika report into Greece's economic progress (or lack of it).

Der Spiegel has reported that the Troika's initial assessment is that there is a Euro14BN hole in Greec's finances for 2013/14. This hole being Euro3.5BN larger than the previously identified hole of Euro11BN.

The abundance of black holes is rather alarming, given that the Troika found a Euro15BN in Greece's finances in February 2012.

Therefore will Greece be given more time and more money?

The German Finance Minister, Wolfgang Schaeuble, as per the BBC sums up the situation perfectly:
"I have always said that we can help the Greeks, but we cannot responsibly throw money into a bottomless pit."
The question is, at what stage do those funding Greece realise that the Greek economy is a "bottomless pit"?

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