The Other I

June 21, 2011

The sublime and the frivolous

Filed under: Just Stuff,The Economy: a Neophyte's View — theotheri @ 8:44 pm

The news for the last couple of days has been about the serious possibility – even the probability – that Greece is going to default on its sovereign debt.  I doubt most Americans think this has much to do with them, but I fear it does.  If Greece defaults, it will have a major impact on banks.  The impact on the global banking section would not be unsustainable.  Unless —

Unless a Greek default triggers defaults in Ireland and/or Portugal, and possibly even Spain.  Over here analysts are saying that credit default swaps are spread throughout the global banking system, and it is impossible to estimate just how big and widespread the rot could be.

A contagious Greek default would also destroy the euro as a world currency.  That will have profound economic consequences not just for Europe but for the rest of the economies in the western world.  And that includes America.

So what happens in Greece does matter to Americans.

In the meantime,Peter and I have kept ourselves entertained with another question of intent.  A workman was backing his van into our drive today and he kept shuffling in and out in order not to brush against a large evergreen tree at the side of the drive.

I thought he kept shuffling around because he didn’t want to damage the tree.  Peter thought it was because he didn’t want to scratch the side of his new van.

I think Peter was probably right.  I hadn’t even noticed it was a new van.

I hope I’m wrong about Greece too.  But I’m afraid I think they are going to default sooner rather than later.


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