1

Greece gambling with 'financial armageddon'

People walk at central Athens square on May 14, 2012. Greece on Monday faced the prospect of fresh polls after political parties failed to narrow divisions over a painful EU-IMF bailout deal, with few expecting progress at talks to form a government.

David Brancaccio: The president of Greece is trying to push the main parties there to form an emergency government. If not, there will be new elections. That could up-end the promises Greece made to cut budgets in return for bailout money.

George Christides covers the economy as a freelance journalist based in the Greek city of Thessaloniki. Good morning.

George Christides: Good morning.

Brancaccio: What do you think happens to the promises that Greece made to cut its budgets if there is indeed another election?

Christides: Yes, I think it's quite clear that if the left-wing Syriza party that is currently leading the polls gets the majority along with other leftist parties, then there will be no following up with our commitments toward the troika. So I think it's a poker game, they'll play the card that if we go down, we take Europe with us. If, on the other hand, there is a majority of pro-bailout parties, then I think there will still be an effort to renegotiate the terms for the bailout, but Greece will have a better chance of staying in the euro.

Brancaccio: Are people coming to grips with the idea that the country might, just might have to leave the euro and go back to the drachma?

Christides: Although 80 percent of the Greek people wish to remain the eurozone, I'm afraid to say that for many people, returning to the drachma might seem like a salvation instead of a doomsday scenario. This is where the major political parties have failed to convince them that a financial armageddon might ensue in case we have to leave the eurozone. The same stands for Europeans as well, coming to grips with a possible Greek exit.

Brancaccio: George Christides is a freelance journalist with United Reporters, based in Thessaloniki in Greece. Mr. Christides, thank you very much.

Christides: Thank you, it's been my pleasure.

About the author

David Brancaccio is the host of Marketplace Morning Report. Follow David on Twitter @DavidBrancaccio
Log in to post1 Comment

Financial armageddon! NPR is truly taking a Rush Limbaugh format! The European elections rightfully routed all these bank friendly ministers and hopefully the people will have an honest politician among the newly elected. Iceland's economy was fair worse than any of the nations struggling with the sovereign debt from fraud and is well on its way to fiscal solvency having defaulted of all that fraudulent debt. Whether it is Ireland, Spain, Portugal, Italy, or Greece, defaulting will surely bring a head to this long-term recession and it will force banks to write-off bad loan debt and in the process downsize. The vast majority of people in both the US and Europe want these banks to own their fraudulent debt and want them to shed assets until they are the reliable regional banks of yore.

The only armageddon will be for the banks. Sure we will see another recession, but we will be able to bounce back from it with a strong democracy rather than limp along with this weak and corrupt plutocracy. We need a Marketplace for the public on public radio!

With Generous Support From...