Greece's attempts to gain some breathing space in its ongoing debt crisis by accusing the countries it hopes to lend them money of bad faith and imperialism, and by not showing any willingness to put it's financial house in order has paid off exactly as one would expect. Its own citizens are losing faith in the government and bank and are trying to reclaim the money they have before it is confiscated or devalued out of existence:
Via Stacy McCain
The only question is whether the financial collapse of Greece will be the trigger in a series of similar catastrophes leading to a world wide debt crisis, or the bad example which will at least temporarily cause the remainder of the PIIGS to pay attention.The Eurozone’s problem child throws a tantrum:In addition to Margaret Thatcher’s famous maxim about socialists eventually running out of other people’s money, there is also Stein’s Law. This was coined by Herb Stein, chairman of the Council of Economic Advisers during Richard Nixon’s presidency: “If something cannot go on forever, it will stop.”
Two senior Greek retail bank executives said as many as 500 of the country’s more than 7,000 ATMs had run out of cash as of Saturday morning, and that some lenders may not be able to open on Monday unless there was an emergency liquidity injection from the Bank of Greece. An official with Greece’s Capital Markets Commission, the markets’ regulator, also warned that the Athens Stock Exchange may be unable to operate on Monday without a cash injection into the banking system. A Greek central bank spokesman said it was making efforts to supply money.
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After withdrawing more than 30 billion euros as the anti-austerity Coalition of the Radical Left, or Syriza, took power, depositors are now reacting to the latest twist in the five-month standoff with European leaders and creditors.
And the problem of the Eurozone’s weaker nations expecting bailouts from their rich neighbors obviously cannot go on forever. So what happens when it stops? We don’t know.
Portugal, Spain, Italy and Ireland — the other fiscal weak sisters in the Eurozone — may manage to avoid default, and the richer EU nations may be able to stabilize the overall regional economy. If so, the Greek problem is just a Greek problem.
On the other hand, who knows?
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We’ve spent seven years in a slow, weak recovery from the crash of 2008, and it might be that the Greek crisis will trigger a worldwide recession. Riots, famine, hyperinflation — anything is possible.
Silver and gold are still pretty cheap . . .