Global News Journal
Beyond the World news headlines
from Jeremy Gaunt:
It seems as if almost everyone was surprised by Prime Minister George Papandreou's decision to hold a referendum on the euro zone's bailout package for his country. At the very least, it can probably be said that he is weary of being hammered from all sides -- his own party, the opposition, the people on the street, Germany, the tabloid press, you name it.
A lot will obviously depend on what question is asked. Do you want an end to austerity, would get a clear yes vote. Do you want to leave the euro zone -- perhaps not.
Financial markets, however, do not initially appear content to wait. Talk of an end-of-year rally is off the table (at least for now). It's not exactly χάος (chaos) out there, but Papandreou's experiment in δημοκρατία (democracy) has sent the whole euro zone project into a new, risky phase.
It was a typo, but RBS's take on the Greek referendum this morning will have had some resonance:
The periphery economies of the euro zone are suddenly in the spotlight. Credit rating agency Standard & Poor's has cut its outlook on Ireland's sovereign debt to negative. It worries that fiscal measures to recapitalise banks and boost the economy might not improve competitiveness, diversity and growth -- all making it harder to manage debt.
Next came Greece. S&P basically put the country on watch with a negative bias. The global financial crisis has increased the risk of a difficult and long-lasting struggle to keep the Greek economy on track, it said.