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Greek End Game - Paul Krugman Blog - NYTimes.com
Many commentators now believe that Greece will end up restructuring its debt — a euphemism for partial repudiation. I agree. But the reasoning seems to stop there, which is wrong.
K: Greece will end up leaving Euro, austerity measures will cause economy to contract, which needs to happen: "internal devaluation" only possible if they leave the Euro. by May 6
-Greece will end up leaving the Euro, too by May 6
WILL the euro still exist in 10 years’ time? That is a trickier question to answer than it was three months ago, when European Union leaders first lined up in Brussels to wag their fingers at the markets and offer vague declarations of “solidarity” with Greece in its hour of fiscal need. The political will to preserve the euro should not be underestimated, any more than was the political will to create it. Indeed, EU resolve has strengthened since February. But the crisis has worsened even faster. There is anger in Brussels that it took until May 2nd for the euro-zone countries to put real money on the table: €80 billion ($105 billion) to meet Greece’s borrowing needs, topped up by €30 billion from the IMF.
Charlemagne: The euro's existential worries | The Economist
The Welfare State's Death Spiral
WASHINGTON -- What we're seeing in Greece is the death spiral of the welfare state. This isn't Greece's problem alone, and that's why its crisis has rattled global stock markets and threatens economic recovery. Virtually every advanced nation, including the United States, faces the same prospect. Aging populations have been promised huge health and retirement benefits, which countries haven't fully covered with taxes.