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European Debt Crisis

Signs of contagion from Greek troubles

Marketplace Contributor May 14, 2012

Jeremy Hobson: And let’s get some analysis now from Julia Coronado. She’s chief economist at the investment bank BNP Paribas and she’s with us live this morning from Paris. Julia, good morning.

Julia Coronado: Good morning.

Hobson: Do you think that Greece is going to have to leave the eurozone?

Coronado: Look, the chances are rising everyday. I think it’s a distinct possibility. Bottom line is, the Greece population is saying no to the terms of the bailout, and Germany is saying no room for compromise.

Hobson: And what are the people saying there in Paris? You’re in one of the key countries in the eurozone — how are they feeling this morning?

Coronado: It’s a pretty gloomy mood over here. Already we’re seeing the contagion — we’re seeing borrowing costs in Italy and Spain shooting higher this morning. You know, there’s a notion that there’s a choice between growth and austerity, but bottom line is, European countries are living beyond their means and investors are less and less willing to finance those deficits. So it’s a pretty difficult picture over here.

Hobson: Julia Coronado, chief economist with the investment bank BNA Paribas. Thanks as always.

Coronado: It’s a pleasure.

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