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Courtesy of Daniel Sckolnik, ETF Periscope
“Economics is extremely useful as a form of employment for economists.” – John Kenneth Galbraith
One of the great ironies regarding our elected officials can be found in the fact that they often consider the people that put them in office not quite wise enough to understand what is best for them. There’s some truth to this, of course, for if their constituents were arguably more intelligent they likely would never have voted for the rascals in the first place.
Case in point: the Prime Minister of Greece, who has declared that his constituents must tighten their belts further, unconcerned that many of them have apparently run out of notches.
It’s simple, really. Greece’s government requires more money, or it implies it will be unable to avoid defaulting on its debt, even though it is little more than a year since they received over $150 billion in bailout funds from The International Monetary Fund and the European Union.
The IMF, currently without the services of its seriously indisposed former chief, and the EU may need to prop up Greece yet again, lest the specter of default whips into a full-blown banshee of “contagion” that spreads throughout the EU. The IMF and the Euro bankers will be, apparently, willing, though likely not very happy, to oblige with billions of dollars in new funds as long as Greece doesn’t insist on restructuring its debt.
Again, simple. Except for a minor detail.
The singularly most likely way not to restructure the debt lies in the Greek government imposing further austerity measures upon its population. However, according to a recent poll, a large majority of Greeks refuse to endure any further austerity.
A conundrum, for certain.
The thing is, of the group of European Union countries known by the acronym PIIGS (which includes Portugal, Italy, Ireland, Greece and Spain), Greece is not the most serious problem. Because even though there have been protestors shouting from the streets of Athens for a while, it is another country that is creating a larger sense of dread among economists, politicians and investors in Europe and beyond.
That country is Spain.
Tens of thousands of protesters throughout Spain’s cities gathered to howl in frustration at the state of their economy, which appears to…
