Tuesday, February 21, 2012
When a Greek door opens ...
Posted by David Smith at 08:45 AM
Category: Thoughts and responses

It is not the done thing to be remotely optimistic about Greece but maybe we should give the 2nd rescue package, 130 billion euros and plenty of haircuts for the banks, a chance. It is a long time since the Greek economic miracle of the 1950s and 1960s, when growth averaged 7% a year, but in the 10 years before the crisis Greek growth averaged 4% a year. The question is whether the austerity leaves any room at all for growth. It should leave some.

The eurozone crisis is far from over and has many twists and turns ahead, as the markets are indicating. But, largely thanks to the actions of the European Central Bank, sentiment has improved. The question is whether we should now have to turn our attention to Iran, and the risk of a sustained spike in oil prices.