In other words, if approved by the Greek parliament, start your clocks for the next round of panicked discussions about default. This will not fix this very serious problem. It only delays the inevitable.
"I don't see this fiscal plan taking effect whether it gets passed or not," David Lea, European analyst at Control Risks told CNBC.com earlier this week. "Does that push Greece inexorably towards default? I think it probably does."Greece on its own is not necessarily the problem. Once you add in Portugal and Ireland and then start thinking about Spain or Italy, that's when you have a very serious problem.
Fear that Greece may default on its debt reached new heights on Thursday, so much so that anxious investors were willing to pay to lend their money to the safest borrower they could think of—the U.S. government.
European banks, meanwhile, faced higher short-term borrowing costs as investors fretted about their exposure to Greece and other indebted euro zone countries.
