WHAT’S GOING ON???

The IMF puts Greece’s debt/GDP ratio at 130/100, approaching the red zone, yes, but a country should not be on life support with this kind of ratio.  In the past, ratios of 120/100 were considered a mere warning and not a serious threat to default. Nevertheless, Greece is being squeezed, interest rates on its bonds are soaring and the country is on the verge of bankruptcy.  (All figures are for 2010).

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Sculptures from the Temple of Zeus. Priceless. Would really look great in a billionaire’s collection.


Italy’s debt to GDP is 118/100 – definitely not in the red zone of default by past yardsticks.

Spain, Portugal and the United States have debt ratios below 100%. Yet the economies of these countries are considered to be on the verge of crisis.

Japan’s ratio is 226/100 – currently the highest in the world. While Japan’s economy is stagnant like all others, investors consider the yen a safe investment and are still buying. And Japan’s bonds are selling at record low interest rates.

So what’s going on?

File:ColosseumAtEvening.jpg

Who will own the Colosseum in the future? (Courtesy of Andreas Tille. Click photo for link).

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