REPORT: Europe Working On A 'Plan B' If The Greek Government Blows It

B

Photo: Wikimedia Commons

With the austerity vote potentially down to just a 1-vote cushion in the Greek parliament, the question suddenly becomes: What does Europe do if the vote fails, and therefore Greece becomes ineligible to receive further aide.According to an article in today’s Financial Times Deutschland, a contingency plan is already being worked on.

Per our Google translated version it sounds like Plan B goes something like this: First, acknowledge that a vote failure would not represent instant bankruptcy. Perhaps some new deal could be worked out with conservative MPs to vote for something. That isn’t clear.

If that fails: ringfence Spain!

With Portugal and Ireland already out of the market (with government funded by the IMF for a while), the focus then turns to the biggest country that’s in the market, and that’s obviously Spain. How you protect isn’t clear, but a country whose economy makes Greece the size of a gnat obviously becomes worry #1.

(via Megan Greene)

NOW WATCH: Money & Markets videos

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.


Tagged In

greece moneygame-us