Saturday, March 3, 2012

The (Financial) World To End On March 20th? Greece Has To Cough Up 14 Billion Euro's It Doesn't Have

In a post entitled AT THIS LINK "The Greek Bailout, the CDS Market, and the End  of the World" at my favorite doom and gloom site AT THIS LINK "The Market Oracle" Shah Gilani advises that March 20th may be the tipping point.

The core of his article explains that Greece has to come up with the goods on March 20th and it doesn't have them. A white knight could of course come in and toss Greece more money (the ECB? China?) but surely a time must come, if it is not this time, that even the bottomless pit of printed money, which is just piling debt  upon debt for Greece, must come to an end. perhaps the 20th is the end game.

In another post "DeepCaster" AT THIS LINK discusses the ramifications for the USA's economy from all this money printing in suitable Market Oracle end of the world analysis with a suitable headline "Gaining from Gargantua Until it Collapses. Basically "buy gold" is his answer. 

Certainly it has been the right answer over the last two years and, whilst one can poke fun at the doomsters one has to ask the question-how long can Bernanke keep churning out endless credit and creating endless debt. DeepCaster asks some interest in questions and displays some frightening facts.

Here is Shah Gilani's main comment-lets hope he is wrong.

"Here's the long and short of it.
Greece needs to make a 14 billion euro ($19 billion) payment on its huge outstanding debt on March 20, 2012.
The problem is Greece doesn't have the money, even after the previous 100 billion plus euro bailout.
If it doesn't make the payment it will be in default and all hell will break loose.
That means banks that hold Greek bonds won't get all their money back and they will have to write down Greek debts to zero.
That will trigger contagion as other countries in Europe will be seen as vulnerable to default too, and as panic in Europe grows from depositors trying to get their money out of insolvent banks, the spillover will infect world markets.
That's the case for contagion."

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