WSJ reports that S&P downgraded Greece to Junk Status today severely limiting the proud Democratic Socialist nation's options of getting out of its mostly self-inflicted crisis.
"The downgrade results from our updated assessment of the political, economic and budgetary conditions that the Greek government faces in its efforts to put the public debt burden onto a sustained downward trajectory," said S&P credit analyst Marko Mrsnik.
Earlier S&P downgraded Portugal, and some other nations like Spain, Ireland, and Italy are potentially in trouble as well.
This is definitely not what Germany and France envisioned when they originally went all out for the brotherhood of European Nations. Germany especially was all for it while imagining a huge marketplace with happy countries producing amazing products non-stop led by the diligent German businessmen. It was that new internationalist spirit that flew over the concerns of some nations' work ethics and philosophy being incompatible with the Free Markets and Capitalism.
As Germany is now having to consider bailing Greece out, with German citizens extremely wary of handing cash out to beggars with not much hope of getting it back, and the real possibility of taxes being raised, they are suddenly no longer singing the European Union ra-ra-ra song.
The few options facing the moribund Greek nation include defaulting on the debt, getting a bailout which would probably put Greek government out of business while European Union makes the decisions, pulling out of the Euro, or getting out of the European Union completely.
With so much invested in the European Union, it is hard for me to imagine that it would fall apart over this. However the severity of the problems facing Eurozone is so understated and the reluctance of the producing nations like Germany, Austria, England, and France to keep southern European Nations afloat could bring this house of cards down and drastically reduce EU membership letting the sinking ships float away on their own.
In good economic times everyone is a brotherman, but in bad it's everyone for themselves making the European Socialist promise a sham. The countries most neo-liberal in philosophy will survive. The decrepit socialist paradises will keep sinking.
And finally Czech president tells it like it is, as usual, blaming the Euro for helping Greek inability to help themselves -
some choice tidbits:
The Greek crisis is the fault of the single currency system, which fails to allow the troubled southern European country to devalue its exchange rate, the president of the Czech Republic, Vaclav Klaus said in an interview pre-released Tuesday...
As regards to economic growth and stability, the Eurozone has been dead for a long time, but given the large amount of political capital invested in the union, its politicians will never let it collapse formally, the Czech president told Germany's Frankfurter Allgemeine Zeitung...
It is the "euro that has caused this tragedy," Klaus claimed. Without the single currency, the Greek government could have coped with the crisis by having a 40% devaluation of its currency, but in a currency union this is not possible, he reminded...
The president, whose euro-skeptic beliefs are well-known, said that he feared the crisis was being used as a pretense "for even more Europeanization" and "unification." Indeed, the "freedom and prosperity" of Europe is already under threat, he claimed.
Yeah, that's what we need... New World Order with one currency so we can all sink together.