Interesting outlook on the crisis in Greece, and the US level of involvement.
The crisis in Greece poses the most significant challenge yet to Europe’s common currency, the euro, and the Continent’s goal of economic unity. The country is, in the argot of banking, too big to be allowed to fail. Greece owes the world $300 billion, and major banks are on the hook for much of that debt. A default would reverberate around the globe.
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The Eurozone members have been aware of the potential conflict between the fact that monetary policy is set for the entire EU area, while government spending, fiscal, policy is handled by each country differently.
The only major European country not using the Euro is Great Britain. Its retention of the pound sterling made it able to devalue their currency in response to the crisis. Such a move could not be repeated by other countries in the region.
I have asked professors in my various economic classes about this issue and many have suggested that Greece default and return to their former currency where they would then be able to instill both monetary and fiscal policies to clear their debt. However I think it is more discouraging and frightening that the major banks on Wall Street have participated in such questionable affairs and this only furthers the argument about the amount of power being placed in these financial institutions.
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