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Friday, 2 March 2012

Greece fails to implement required reforms for second bail-out

Negative market sentiment towards the euro currency is likely to be amplified by polarising European disunity.  Some European finance ministers are not satisfied that all Greece's political party leaders are fully behind the reforms, according to Reuters.

Europe has demanded that Greece show more proof that it would implement "hastily agreed" spending cuts, according to the Financial Times.  A 300 million euro financial gap has re-emerged when the Greek government changed the way that unemployment benefits were paid.  Not all of the 38 agreed conditions required for their second bail-out have been met by Greece.

Europe now has not much choice other than to bail out Greece irrespective of whether Greece properly implements the agreed reforms.  After two bail-outs and the acceptance by Europe of fraudulent Greek national accounts, and the likelihood of more bail-outs, demands upon Greece no longer command effective respect.

I acknowledge the Financial Times' article "Eurozone delays half of Greece's funds", and Reuters article "Exclusive:  Euro zone ponders delay of 2nd Greek bailout program".

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