User:Nick Gardner /Sandbox: Difference between revisions
Jump to navigation
Jump to search
imported>Nick Gardner No edit summary |
imported>Nick Gardner No edit summary |
||
| Line 53: | Line 53: | ||
As the crisis spread from Greece to the other [[PIIGS]] countries, there was widespread agreement that a choice would have to be made between the abandonment of the euro and the adoption of the centralised control of economic policy. Support in principle for the latter option was expressed by | As the crisis spread from Greece to the other [[PIIGS]] countries, there was widespread agreement that a choice would have to be made between the abandonment of the euro and the adoption of the centralised control of economic policy. Support in principle for the latter option was expressed by | ||
[[Nicolas Sarkozy|President Sarkozy]] and [[Angela Merkel|Chancellor Merkel]] in December 2010<ref>[http://www.ft.com/cms/s/0/825119d8-0463-11e0-8a3c-00144feabdc0.html#axzz17mftMHoY Gerrit Wiesmann and Peter Spiegel: ''Merkel and Sarkozy call for deeper union'', Financial Times, December 10 2010]</ref>, and again August 2011<ref>[http://www.reuters.com/article/2011/08/16/eurozone-highlights-idUSL5E7JG1YQ20110816 ''Highlights - Merkel, Sarkozy news conference'', Reuters 16 August 2011]</ref>, when they advocated the creation of a "true European economic government" - although they had not reached agreement upon more than a limited initial move in that direction <ref>[http://media.ft.com/cms/1e93f294-c8df-11e0-a2c8-00144feabdc0.pdf ''Letter to President van Rompuy'', Financial Times, 17 August 2011]</ref>. There were mixed reactions from other eurozone countries<ref>[http://www.reuters.com/article/2011/08/17/us-eurozone-highlights-idUSTRE77F55Y20110817 ''Factbox: Eurozone reaction to Franco-German integration push'', Reuters 17 August 2011]</ref> and there is likely to be strong opposition, both to the eventual replacement of government debts by "eurobonds", and to the centralised control of [[fiscal policy]]. | [[Nicolas Sarkozy|President Sarkozy]] and [[Angela Merkel|Chancellor Merkel]] in December 2010<ref>[http://www.ft.com/cms/s/0/825119d8-0463-11e0-8a3c-00144feabdc0.html#axzz17mftMHoY Gerrit Wiesmann and Peter Spiegel: ''Merkel and Sarkozy call for deeper union'', Financial Times, December 10 2010]</ref>, and again August 2011<ref>[http://www.reuters.com/article/2011/08/16/eurozone-highlights-idUSL5E7JG1YQ20110816 ''Highlights - Merkel, Sarkozy news conference'', Reuters 16 August 2011]</ref>, when they advocated the creation of a "true European economic government" - although they had not reached agreement upon more than a limited initial move in that direction <ref>[http://media.ft.com/cms/1e93f294-c8df-11e0-a2c8-00144feabdc0.pdf ''Letter to President van Rompuy'', Financial Times, 17 August 2011]</ref>. There were mixed reactions from other eurozone countries<ref>[http://www.reuters.com/article/2011/08/17/us-eurozone-highlights-idUSTRE77F55Y20110817 ''Factbox: Eurozone reaction to Franco-German integration push'', Reuters 17 August 2011]</ref> and there is likely to be strong opposition, both to the eventual replacement of government debts by "eurobonds", and to the centralised control of [[fiscal policy]]. | ||
Default by Greece would create a [[shock (economics)|shock]] to the global financial system, raising a danger of financial [[panic (banking)|panic]], but the amount involved is smaller than was involved in the ''Lehman Brothers'' collapse that triggered the [[crash of 2008|2008 panic]]. | |||
The economic impact of the Greek crisis is limited by the relatively small size of its economy. The Spanish economy is much larger, making the possibility of a loss of confidence in its government's debt a greater cause for concern. | |||
--> | --> | ||