Europe simply does not have the resources to act as lender of last resort to Italy. Certainly, Greece is a major issue for Europe, but if Italy defaults, then the Eurozone will disintegrate.
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Tuesday, November 08, 2011
Why Italy Matters More Than Greece
The economic disaster in Greece has reached a crescendo in recent weeks, and the Greek tragedy is indeed worrisome. However, the real problem that Europe must confront is not Greece, but Italy, which represents 16.9% of Europe's total GDP. As the chart below makes clear, the GDP's of Greece, Spain, and Portugal are essentially sideshows to that of Italy and the Eurozone as a whole.
Europe simply does not have the resources to act as lender of last resort to Italy. Certainly, Greece is a major issue for Europe, but if Italy defaults, then the Eurozone will disintegrate.
Related Posts
Europe simply does not have the resources to act as lender of last resort to Italy. Certainly, Greece is a major issue for Europe, but if Italy defaults, then the Eurozone will disintegrate.
Related Posts
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