Greece and Italy—whose fiscal and political crises have set off ever-bigger scares among global investors—took concrete steps toward budgetary austerity Friday, helping soothe markets for the moment.We saw this kind of thing time and time again as Greece lurched from one rescue to the next, but with each rescue their bond rates ratcheted up. The rates would jump up, the rescue would come and the rates would fall back, but not as far as they rose. Inexorably, Greek rates went into the stratosphere while one rescue after another was heralded as the one that would save them all.
I'll believe it when I see it.
1 comment:
Amen brother. I don't see any way out except for global inflation as a way to give the bond holders a haircut without explicitly repudiating debt. Holding gold and stocks are a good hedge for such an eventuality.
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