Monday, July 5, 2010

Greece on its way towards recovery

Bloomberg: "... Greece may beat a target to reduce the European Union’s second-widest budget deficit, allowing the country to return to markets to raise debt, Finance Minister George Papaconstantinou said.
“Our hope is to tap markets sometime in 2011,” though Greece can hold off until 2012, Papaconstantinou told reporters in Athens today. A planned auction of short-term Treasury bills this month isn’t considered “a return to markets,” he said.
Euro-area leaders and the International Monetary Fund agreed in early May to extend 110 billion euros ($138 billion) in emergency loans to Greece, which faced soaring borrowing costs amid investor concerns it would default on its debt. In exchange for the aid, the government vowed to implement austerity measures of almost 14 percent of gross domestic product over four years...."
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Comment: What else but austerity can help when a nation is at risk to lose funding? Or does anyone - other than Krugman and some other paleo Keynesians -- really believe that one can spend oneself out of a debt crisis?

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