This morning, eurostat data showed that Greece’s austerity measures have done little to tame the country’s deficit. Germany’s political elite are now calling for a restructuring, and they want it sooner, rather than later.But European authorities may have waited too long, according to Waverly Advisors:
Clearly a restructure is now inevitable, but is it sellable? Probably not. Core state leaders have waited too long and are now stuck between a rock and a hard place. Any fresh “band aid” measures at this junction will be poorly received by the market, while decisive restructuring will alienate voters in Germany and other wealthy states.
But beyond the Greek restructuring, the region still has the problem of Portugal to deal with. With the True Finns looking to make an impact, they may just have gained further evidence for their views from the Greek situation. They, and other right wing, anti-euro parties may argue that clearly, bailouts don’t work and are a waste of money.
This may lend support to the camp arguing for an out-and-out restructuring, rather than a bailout.