The Greeks did this to themselves as it was they who sought out the advice of GS and GS happily offered it for a fee. Its what they do and as I've stated before GS isn't responsible for teaching ethics or morals to a foreign government and its leaders. Furthermore the Greek government has a long recorded history of spending beyond their means and burying their nation in debt with gimmicks and tricks. Even a cursory glance at Greece's economic history shows that it has been a nation of dead beats and crooked politicians for a very long time.
I don't think you understand how fucked Greece is if they default. They will be cut off from credit markets for at least 5 years, maybe longer. They are currently running massive deficits and without the ability to borrow from foreign investors they will have to impose austerity anyway to balance the budget or just print money leading to run away inflation.
I don't think you understand how fucked Greece is if they default. They will be cut off from credit markets for at least 5 years, maybe longer. They are currently running massive deficits and without the ability to borrow from foreign investors they will have to impose austerity anyway to balance the budget or just print money leading to run away inflation.
Argentina defaulted on their debts and has had excellent economic performance afterwards. They had a brief (and severe) dip right when it happened, followed by strong growth.
Argentina is a commodity driven economy so commodity prices have a far bigger impact on growth than any policy decisions. They also still have 20% inflation which is going to catch up with them eventually. Most economists and investors consider Brazil to be much more attractive because the government is much more responsible. This is part of the reason Brazil has been more successful at diversifying away from commodities.
Short version? Greece's leaders wanted in the EU. Goldman Sachs had a plan for them to profit from that would misrepresent Greece's debt and help them get in the EU.
(Sound familiar with Wall Street demanding bad mortgages they could profit from?)
It worked. Before long it was clear about Greece's problems.
They have tried to address the problems onthe backs of the people, with 'austerity'.
The people don't care for that solution and it's being resisted.
As usual there are the wealthy interests and there are the people's interests and they are at odds.
Bild reveals €200 billion Greek capital flight
Bild, 19 October 2011
Unsparing in its criticism of Greece, Bild launches another broadside against its favourite target: "Greeks stash 200 billion euros in Swiss bank accounts!" headlines the Berlin tabloid, whose influence on the Chancellorship is an open secret. "While Europe struggles to help Greece with multi-billion euro bailout plans, more and more Greeks are transferring their money out of the country” to avoid the consequences of a crash in the national economy, announces Bild. “Stop the capital flight!” insists the tabloid’s editorial, which lambasts the Greek elite for refusing to introduce a tax on money transfers or penalties for tax evasion.
This capital should be tracked down in Switzerland, remarks Financial Times Deutschland, which argues that "Switzerland should extradite the Greek money.” The daily reports that Bern is preparing to hold negotiations with Athens to prevent the flight of Greek capital, which will be inspired agreements already concluded with Germany and the UK: the goal will be to tax revenues generated by capital belonging to Greek clients. In exchange, Greece will drop plans to pursue tax evaders and implicated banks. "Athens is hoping that this measure will help to calm social dissent in the country, where the government has been criticised for placing the bulk of the burden of the crisis on the middle and working classes,” explains FTD.