Sunday, 17 June 2012

Greece - take a deep breath

                                       "Headquarters! Should I be panicking?"

You'd be forgiven for feeling edgy about the Greek election after reading comments like this on Greece leaving the euro:

Economic armageddon
If Greece leaves the euro, Germany could be jolted into action and pursue fiscal unity in Europe, smothering any panic among other states. If the Germans don't act, it could lead to an economic armageddon.

The financial equivalent of the Cuban missile crisis
It's not clear who's going to blink at this point. My guess is that, in the end, there will be a bit of blinking on both sides. This is the financial equivalent of the Cuban Missile Crisis.
Niall Ferguson, Historian

Europe's Lehman moment
Many now fear that Europe is about to suffer its own “Lehman moment”. The Lehman bankruptcy, of course, precipitated the worst financial crisis in generation.  
Financial Times

Political turmoil, human hardship
Large numbers of pensioners and households will find their savings are wiped out directly or inflation erodes what they saved all their lives. The potential for political turmoil and human hardship is staggering. 

The cost is 37% of the eurozone's economy
The cost of Greece being ejected from the euro: Around €3.5tn - 37% of euro area GDP (equal to 135% of German GDP) .
European shares plunge 30% - back through their lows of 2009.
Aviva Investors

Who am I to say they're wrong?

But Armageddon is supposed to be a battle bringing on the end of the world, while the missile crisis carried a danger of nuclear war.

The Lehman collapse was a financial disaster, so maybe that's more apt - though the point then was that people were totally unprepared for what happened.

Let's take a deep breath: "Don't panic yet, Mr Mainwaring!"

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