Runaway Train
I check out this cool dude at Rotterdam Central on my way to Amsterdam. Above all, I love the trainers.
So .. Greece is do or die today as government confirms further austerity measures in return for more .. debt. That they will never repay. The Greeks, who are a joke, riot but the alternatives unimaginable : cessation of public services, the end of their country. It would likely trigger the end of the euro and maybe the eurozone. Here is how we got here (compiled by wiki) :
The Greek economy was one of the fastest growing in the eurozone during the 2000s; from 2000 to 2007 it grew at an annual rate of 4.2% as foreign capital flooded the country. A strong economy and falling bond yields allowed the government of Greece to run large structural deficits. Large public deficits are one of the features that have marked the Greek social model since the restoration of democracy in 1974. After the removal of the right leaning military junta, the government wanted to bring disenfranchised left leaning portions of the population into the economic mainstream. In order to do so, successive Greek governments have, among other things, run large deficits to finance public sector jobs, pensions, and other social benefits. Since 1993 debt to GDP has remained above 100%.
Initially currency devaluation helped finance the borrowing. After the introduction of the euro in Jan 2001, Greece was, at first, able to borrow due to the lower interest rates government bonds could command. The 2007-08 financial crisis had a particularly large effect on Greece. Two of the country's largest industries are tourism and shipping, and both badly affected by the downturn with revenues falling 15% in 2009.
In 2009, the government revised its deficit from an estimated 6% to 12.7%. In May 2010, the Greek government deficit estimated to be 13.6%, one of the highest in the world relative to GDP. Greek government debt estimated at €216 billion in January 2010. This, mind you, a country of 11 M. Accumulated government debt was forecast to hit 120% of GDP in 2010. The Greek government bond market is reliant on foreign investors, with some estimates suggesting that up to 70% of Greek government bonds are held externally. They're done. Game over.
Estimated tax evasion costs the Greek government over $20 B per year.
So here we are.
