Now a days, Europe is undergoing a whole lot of financial problems. However, unlike in US, these financial problems in European countries is not due to excess spending by the consumers but due to excessive spending by the Governments.
Greece is almost Bankrupt and blood is infused every time it is about to die. Spain, Portugal are also battling financial problems and if adequate steps are not taken by the States, they'll also reach the same stage as of Greece.
Greece may solve its problems only by taking exit from European Union. Greece can only solve its problems by increasing external income through promoting its tourism industry and increasing its exports. Exports could be increased through two ways, either by introducing innovative products / services like iphone / google or by selling the products at lower price. Icreasing innovation can't happen overnight. So, only effective option left with Greece is to sell the products at lower price. This could be done either by increasing the efficiency of thw work-force or by devaluing its currency. Increasing the efficiency is bit of a problem in Greece, especially considering the attitude of its citizens, who are raising slogans every day, when their country is trying every bit to save their future (Time of raising slogans had already passed a long time ago when they should had raised voice against rampant corruption and malpractices going on in the government).
The only viable option with Greece & European Union is the exit of Greece from European Union. Then Greece may be able to devaluate its currency and make its exports competitive in global markets. Further, then Greece may also force a better deal for its Debt with its creditots. This may affect European Banks eroding their capital and creating tremours in International Bonds / Call markets. At that time, the most vulnerable states would be Spain, Portugal & Italy and the Banks.
Therefore, trying to pull out a sunk ship (Greece), EU should try to save other ships from sinking. EU should force its attention to Spain, Portugal & Italy. Also FSCB funds should be used to re-capitalize banks, so that a run on banks don't happen as happened in 2008 crisis. The crisis is spreading in European Countries and EU must act before its too late.
Greece is not Lehman Brother, Greece is Bear Sterns. Italy / Spain would be Lehman Brothers.
Greece is almost Bankrupt and blood is infused every time it is about to die. Spain, Portugal are also battling financial problems and if adequate steps are not taken by the States, they'll also reach the same stage as of Greece.
Greece may solve its problems only by taking exit from European Union. Greece can only solve its problems by increasing external income through promoting its tourism industry and increasing its exports. Exports could be increased through two ways, either by introducing innovative products / services like iphone / google or by selling the products at lower price. Icreasing innovation can't happen overnight. So, only effective option left with Greece is to sell the products at lower price. This could be done either by increasing the efficiency of thw work-force or by devaluing its currency. Increasing the efficiency is bit of a problem in Greece, especially considering the attitude of its citizens, who are raising slogans every day, when their country is trying every bit to save their future (Time of raising slogans had already passed a long time ago when they should had raised voice against rampant corruption and malpractices going on in the government).
The only viable option with Greece & European Union is the exit of Greece from European Union. Then Greece may be able to devaluate its currency and make its exports competitive in global markets. Further, then Greece may also force a better deal for its Debt with its creditots. This may affect European Banks eroding their capital and creating tremours in International Bonds / Call markets. At that time, the most vulnerable states would be Spain, Portugal & Italy and the Banks.
Therefore, trying to pull out a sunk ship (Greece), EU should try to save other ships from sinking. EU should force its attention to Spain, Portugal & Italy. Also FSCB funds should be used to re-capitalize banks, so that a run on banks don't happen as happened in 2008 crisis. The crisis is spreading in European Countries and EU must act before its too late.
Greece is not Lehman Brother, Greece is Bear Sterns. Italy / Spain would be Lehman Brothers.
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