Greece Gets $170 Billion Bailout

by Ryan on February 21, 2012

in Economy,Europe,International Relations

The Eurozone decided today to spend around $170 billion to prevent Greece from defaulting next month.  Those who hold Greek bonds were asked to take 53.5 cents on the dollar as part of the deal.  The International Monetary Fund (IMF) is also lurking in the shadows as billions of American dollars have already gone to various IMF bailouts of European welfare states, including Greece.

The problem is that if Greece defaults or is booted from the Eurozone, then there’s real trouble:  seeing the advantages of default, other tumbling Eurozone nations will see how easy it was and how their nation’s sovereignty remained in tact;  they may follow suit, ruining the euro.  The chain reaction would be devastating to Europe, then to us since we’re so heavily invested in Europe.

I wonder how much of this is merely postponing the inevitable — bailouts have a habit of prolonging the pain without solving the underlying problem.  Plus, it’s another hit to Greek sovereignty as none of this was put before the voters.

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