Euro debt crisis started in Greece in late of 2009; Greek government exposed their true financial deficits when every country started to check the problems in their financial system after sub-prime mortgage crisis happened in US. Three years later, the situation in Greece becomes worse and worse, not only Greece, but also other members in PIIGS (Portugal, Italy, Ireland, and Spain) make Euro zone in dilemma.
In the news “Greeks Pull Cash Out of Banks as Confidence Wanes “, Greek people panic mood continues to spread so that they take out deposit from banks or transfer their money abroad. The bank system basically paralyzes because they can’t get bailout from Euro center bank and international monetary fund. The whole country stuck in political turmoil. If the public still didn’t accept austerity measure proposed by French and German as an attaching condition of bailout loans, government asset would be liquidated and Greece would be kicked out from Euro zone. In the BBC news “What could happen next if Greece leaves the eurozone? ", the author lists the consequence if Greece leaves the Euro zone, which includes recession, bank runs, political backlash, Greek debt default etc.
I have to say, Greek people do face a painful time which maybe continues a long time. The price of huge financial deficits would be high tax and low welfare in material and invasion of dominion because Euro zone will limit Greek expenditure, which is a spiritual torture to Greek. German failed to control Greece historically by force, if they arrives their old aim by economical ways, how Greek people could accept the cruel reality? The other choice is that Greece quit from Euro zone. They can keep the dominion complete, but they would face a serious recession in all area of modern social, where government bankrupt, currency depreciate and society riot. Whatever Greece chooses, it is definite that comfortable life and generous pension in Greece are gone.
German and French don’t arrive to an agreement with Greece on this issue yet, but they can’t stand them unlimitedly. Greek people can’t be used to a tough life which suddenly changes from a happy and rich life. Therefore, I guess Greece would quit Euro zone to depend on them. After Greek struggle to survive in a long time recession, they would find it is good to have a help from Euro zone. And Greece future is a good example for the other PIIGS, not every one of which will select the same with Greece. As for Euro zone, it is not easy to dismiss; meanwhile, German and French are as strong as they did in the past to be on the top among world class nations.
References
Apostolou N. and Rayasam R.(2012, May 17) Greeks Pull Cash Out of Banks as Confidence Wanes abc NEWS Retrieved May 22,2012 from http://abcnews.go.com/Business/greeks-pull-cash-banks-confidence-wanes/story?id=16368493
What could happen next if Greece leaves the eurozone? (2012,May 20) BBC News Retrieved May 22,2012 from http://www.bbc.co.uk/news/business-18074674




