So Greece officially announced default as a result of debt to private creditors. It was an “organized”, contractual default, and not just declared, and this can be considered good news. However, the story has not yet ended. Even with such debts, the country, like other, European countries, which were forced to introduce strict savings into the conditions of economic depression, will be doomed to the years of suffering. This is a story that you should talk about. Over the past 2 years, Greece, as one financial publication has recently been expressed, was a “parable about the risks of financial waste”. Not a day passes without the next expert or politician said that Americans should reduce expenses or the United States will turn into Greece.
In fact, the experience of Greece shows that with a shortage in good times, one might encounter difficulties, as confirms the history of Greece, but not Spain. Trying to eliminate the deficit during difficulties – the correct recipe for depression. Today, the saving mode causes depression that can be seen throughout Europe. Greece in this is the worst example.
Unemployment in the country amounted to 20 % even in the public sector, including healthcare. Ireland, which carried out all the measures required by the population, is also in terrible condition. Unemployment – about 15%. In a similar position are Spain and Portugal. You can ask a question what alternatives such countries as Ireland and Greece had.
The answer is that they do not have suitable alternatives, except for leaving the European Union. This would be an extreme step that no one can decide on, until other options are exhausted, which Greece is rapidly approaching. Germany and the European Bank could do something so that this extreme step ceases to be a necessity by softening the requirements for saving and stimulating the European economy as a whole.
The main thing is that the states have their own alternative: they have their own currency, so the state can take long -term loans at historically low interest rates, so America will not have to follow the path of economic decline. It’s time to stop using Greece as an instructive example of the danger of deficiency. It must be considered as a warning from the danger of too quickly a decrease in deficiency at a time when the economy is in deep depression.