June 1st Weekly Market Update
There is no question that Greece is tangled economically and politically in Europe. This was by design — the adoption of the euro was intended to be permanent, as was membership in the European Union (EU).* These entanglements are being tested by the ongoing crisis regarding Greece, its debt, and its ability to continue to use the euro as its currency. Though much has been — and will continue to be — written about this situation, we can reduce the problem to three basic issues.
Will Greece default on its debt?
Should Greece default, is the financial system at risk?
Can Greece stay in the Eurozone? Does it matter?
WILL GREECE DEFAULT ON ITS DEBT?
It’s hard to gauge the current progress of discussions. Even as the current round of negotiations approaches the next deadline (June 5), the picture is muddled: the Greek government says a deal is at hand, but that claim is rejected by some international officials.
Greece is running out of money; and without a resolution in coming days, it will likely be unable to make its scheduled June payments, the first of which is due Friday, June 5, 2015. There have been short-term fixes for these deadlines, including the Greek government transferring cash from local governments, delaying pension payments, and borrowing additional funds. The issue appears to have reached a critical point.
For the full article: THE GREEK DRAMA