Greece’s Financial Crisis may have Much Larger Ripples

29 Jun

Many of you should be able to identify with the time honored image of a boy tossing a pebble in to a pond, and watching the ripples flow out over an otherwise still lake. The lesson that goes with the image is that every action has reactions, and that one small event can affect things far away from the impact. Imagine, now, that a boulder has been hefted in to the lake, with the word “Greece” carved in to the side.

Greece’s potential departure from the Euro zone is the first decision of its kind. Never before has a country abandoned a currency quite like this, save at the beginning of World War I, and that didn’t end well for anyone. In the shadow of Greece’s economic troubles, concerned analysts are starting to worry about much larger effects of Greece’s troubles.

The most likely result, when also considering Italy’s professed economic problems, is the complete collapse of the Euro. Several investors, from private Greek sources and businesses, to other European governments are turning out in droves to attempt to bail out Greece’s financial burden. While Europe’s current issues may benefit American stock prices somewhat, if Europe falls, the rest of the world is going to feel it.

It’ll take more than money to save Greece. If sustainable economic practices can be taught to Greek government in time, perhaps the situation can be salvaged. Hopefully, this happens before the Euro Zone collapses and pulls its businesses in with it.

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One Response to “Greece’s Financial Crisis may have Much Larger Ripples”

  1. Tombs Review June 29, 2012 at 9:46 am #

    Today’s decision to create a growth pact and a 120 bn euro fund to subsidize embattled banks has heartened markets in the zone. The CAC 40 is up 2.5% at the time of this writing. While contagion may still infect the global economy, todays news is good for investor confidence.

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