Are We Heading for the “Grexit”?
In the wake of Greece’s inconclusive elections, a caretaker government has stepped in to run the country until a new round of voting can take place and – hopefully – a coalition of some sorts can be cobbled together that is able to formulate some kind of coherent policy response toward the Greek economic malaise and reduce the political turmoil. Meanwhile, those same Greek politicians that must find a way to appeal to an angry and disaffected electorate also must combat pressure from outside the country. The president of the European Commission, José Manuel Barroso, simply stated bluntly what many pundits have been saying quietly since the elections early this month revealed the magnitude of the challenges confronting any new Greek government when he took to the Italian airwaves recently. “If a member of a club does not respect the rules,” he proclaimed, “it’s better than he leaves the club.”
A “Grexit” is a far from certain outcome, although its probability is greater than it was only a few weeks ago. While Greeks want to stay within the eurozone, they find the conditions for their recent bailout to be oppressive, and they want to renegotiate the terms of the aid they have received. In the absence of a crystal ball, we can’t chart what might happen in the event of “Grexit”, but for insight into the crisis and the issues that may yet lead to a “Grexit”, we invite you to take a look at the charts in the following slideshow.
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