Following fraught and, at times, angry exchanges in the German parliament, Greece now has the final approval to begin negotiations on what will be its third bailout. The head of the Eurogroup, Jeroen Dijsselbloen, though welcoming the German’s decision, warned that the process of negotiation would take around 4 weeks. Greece owes, in total, €320 billion (nearly $350 billion at today’s rates) and, last month, became the first ever developed nation to be in default with the International Monetary Fund.
As you can imagine, life for many people in Greece is full of worry. Apart from currently contending with wild-fires around Athens, the Greek capital, and other major residential areas in the south, banks have now been shut for 3 weeks, along with the imposition of capital controls, denying millions of citizens (including pensioners) unrestricted access to their money. Even though it is highly probable that those same banks will re-open on Monday, capital controls will remain and the Greeks will then have to immediately contend with a 10% VAT increase on public transport, plane and ferry tickets, certain supermarket produce, taxi fares and restaurant food and drink, as the first of many austerity measures is introduced.
It has happened before and it will do so time and time again. Developed countries engaged in too much freely-acquired debt; its citizens denied access to their money in the banks. If you’re concerned this will one day be the fate of U.S. citizens, please Like & Share this post.