Monday, January 26, 2015

Why the Greek Elections Might be the Beginning of the End for the Euro

Fortune's Chris Matthews writes:
The anti-EU sentiment isn’t just a product of the depression-like conditions that Greek citizens have been enduring. In Spain, where elections at the end of 2015 will have huge implications for the future of the Eurozone, another anti-bailout party, Podemos, has been gaining support. Meanwhile, in France, polls indicate that the far-right eurosceptic Marie La Pen would win the first round of the 2017 French Presidential elections if they were held today. Even Germany, the stalwart of the status-quo, has an ascendent anti-euro party, called Alternatives for Germany, which recently won big gains in state elections.

So, while Greece’s election results will not likely to be a catalyst for a sudden break up of the Euro, they can be viewed as yet another in a series of events that suggest that the union is failing...

With widespread unemployment in countries like Spain, Greece, and Portugal, and a banking system that remains undercapitalized, there’s little reason to believe that the European economy is going to improve enough in the coming months such that mainstream parties can stem their losses at the polls.

Markets might be taking it easy for now, soothed by the massive bond-buying program the ECB announced last week. But the long-term picture for the European project looks a little worse today than it did a week ago.

1 comment:

  1. There is really no side to cheer for in the Greek situation. On one side the socialist control freak banksters of the EU. On the other side the even more socialist Greeks. Like all socialists, they believe it is their God-given right to go as far and fly as high as they can on other people's money and hard work.