Frying in Hot Greece......

[marmar]

:scared:



Goodhart Says Greek Deal May Collapse as Crisis Tests Euro
By Svenja O’Donnell and Andrea Catherwood


May 4 (Bloomberg) -- Greece’s bailout “might collapse” and the nation’s debt crisis makes it “hard to see” how the euro will survive in its current form, former Bank of England policy maker Charles Goodhart said.

“If this financing deal should collapse, and it might for one reason or another, then there would be a question of what the Greeks could possibly do,” Goodhart said in an interview with Bloomberg Television in London today. “Default would be totally disastrous for them and leaving the euro would equally be disastrous.”

Euro-region ministers on May 2 agreed to a 110 billion-euro ($145 billion) bailout with the International Monetary Fund to prevent a Greek default, after investor concern sparked a rout in Portuguese and Spanish bonds last week and sent stock markets tumbling. The Greek crisis shows the need for more integration within the euro as a common currency, Goodhart said.

“It’s very hard to see how this is going survive this particular test,” he said. “The euro system has either got to have much more integration or parts of it will fall by the wayside.”

Standard & Poor’s last week cut Greece’s credit rating to the junk level of BB+, lowered Spain’s grade by one level to AA and downgraded Portugal by two steps to A-. Greece has now agreed to budget-cutting measures worth 13 percent of gross domestic product. ..........(more)

The complete piece is at: http://www.bloomberg.com/apps/news?pid=20601087&sid=aX9pEOY09jQQ&pos=5

[WinkyDink]

1. The euro was never a good idea. Too many disparate economies, duh.