by Elliott Morss Earlier, I noted there were two parts to IMF Stand-By Program for Greece: austerity and increasing its competitiveness. However, by the beginning of 2012, the IMF had concluded that the austerity part of its plan for Greece had failed. Why? Because: the austerity measures were so extreme that initial efforts to implement …
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A.I.G. and Greece: Comparing Bankruptcies
by Elliott Morss Introduction In the midst of the Greek crisis, a report was issued last week by a watchdog government agency assessing how the Federal Reserve handled the A.I.G. crisis. Remember that one? At one point, the Feds had ponied up $182.3 billion to save A.I.G. And let’s put this in perspective: so far, …
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Greece: The Sudden Stop That Wasn’t
by Aaron Tornell & Frank Westermann
With economists’ eyes fixed squarely on Greece, this column tries to solve a puzzle. Since 2008, tens of billions of euros have fled Greek bank accounts. Yet somehow the country still has a current-account deficit. Where has this money come from?
Normally, things don’t work like this for nations in crisis. Greece has experienced severe capital flight yet its current-account deficit has remained almost unchanged; its international reserves are little changed. On net, €24 billion of private capital left the country between 2008 and 2010, but Greece still managed to accumulate a €85 billion current-account deficit – 12% of GDP.
Where has the money come from? The answer can be found by looking at the balance of payments statistics.
Portfolio: Preparing for Greece’s Failure
The financial news of the week again is about the eurozone and we are seeing lots of entities come up with lots of possible solutions about how to solve the eurozone problem. They all of course rest on what to do about Greece. The problem is, they are coming from the wrong angle. From STRATFOR’s point of view, Greece does not have a particularly bright future as a state before the eurozone crisis is taken into account.
Western Financial Support for Ukraine: The Greek Analogy (continued)
by Elliott Morss, Morss Global Finance Introduction In my last piece, I looked at the IMF/EU bailout efforts for Greece to see what can be expected as the West launches a bailout for Ukraine. And every day, what the West will do becomes clearer. Let’s back up to December of last year. At that time, …
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