European Debt Crisis In Danger of Metastasizing: IMF Warning On Eurozone
The International Monetary Fund has released a report that contradicts what the Eurozone politicians have been boasting of for about a year. Despite assurances that vast sums of borrowed money loaned to the even more indebted Eurozone nations of Greece, Ireland and very soon Portugal would contain Europe’s sovereign debt crisis from spreading like a malignant cancer to the more substantial economies in the monetary union, the IMF apparently begs to differ.
According to the most recent IMF report on the European debt crisis, “contagion to the core euro area, and then onwards to emerging Europe, remains a tangible downside risk.” In the meantime, European politicians are already frantically looking at renegotiating their bailout loans to Greece and Ireland, with a reduction of the unbearably high interest rates being incurred by Athens and Dublin. But many savvy economists have already warned that these massive bailouts are an expensive fallacy, and will only delay the inevitable: restructuring loans that can never be repaid, or sovereign default.
The tone of the most recent semi-annual IMF report makes it clear that those who actually look at the numbers know that the European sovereign debt crisis is far from over, and has every possibility of getting much worse.
