Thursday, January 15, 2015

Greek election, and the end of the world

As mentioned in a prior post, Greece goes to the polls in 10 days.

This is perhaps the most important election in the history of that country. Why?

It has the potential to kick off a Grexit, or, Greece leaving the Eurozone.

Why does that matter?
Not only could it damage the Euro, it could damage the EU. It could force Greece to leave the EU altogether.

And why does that matter?
For starters, damage to the EU could be huge. Take for example Poland, where 40% of mortgages are in Swiss Francs. If the Euro falls too much, we could see another housing bubble burst. In addition, there are other countries that might leave the EU should the opportunity arise, such as the United Kingdom.

Could the EU survive all this?
Probably, but maybe not. The entire European Union could come crashing down, not to mention the economic fallout. Being so tied to Europe as we are, this would have knock on effects here in North America, and could spark a second recession, worse than the first.


In short, the election might just result in a second great depression for the entire developed world.


So, if it is so important, why have I yet to post about it?

At the risk of saying "It's all Greek to me" the political situation in Greece is very very complicated, and very very nuanced. I am still trying to figure out where all the players stand and how they might act based on certain possible results.

The election will take place next Sunday (not the Sunday that comes in a few days, but the one after that) and I plan to make a rather large post about the Greek election on the Sunday prior (the 18th) based on what I know.


Any and all feedback from those who are following this issue is welcome, and I may include comments in the blogpost if I find they fit with what I plan to say.

2 comments:

  1. I fully expect and even welcome a SYRIZA win. I may not agree with Tsipras' politics but at least he's willing to challenge the dynamic that, let's be frank, has nor served the Greek people well. I don't see his election as some sort of harbinger of the apocalypse, nor do I expect most Europeans.

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    1. So after running an economy endemic with corruption, grossly over spending beyond their means and actively avoiding legal taxation you think the Germans, Finns, Austrians and Dutch should pay for Greece? Greeks actively shirk something like 70% of taxes levied against them by their own Government! The bottom line is Greece is unwilling to pay its own way, if they are allowed to default they will simply do it again and again. Time to kick Greece out of the Euro and the EU-it's the only way they'll learn.

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