ukraine

Greek bailout merely the first

Harvard Professor Kenneth Rogoff is warning that the IMF bailout of Greece is just the first of many to come.

“It’s more likely than not that we’ll need an IMF program in at least one more country in the euro area over the next two to three years,” Rogoff, a former IMF chief economist who has co-authored studies of financial and sovereign debt crises, said in a telephone interview. “The budget cuts needed in Europe in many countries are profound.”
Portuguese, Spanish and Irish bond yields jumped last week as investors questioned their ability to reduce budget deficits and avoid Greece’s fate....
At 14.3 percent of gross domestic product, Ireland had the euro region’s largest deficit last year. Greece’s was 13.6 percent, Spain’s was 11.2 percent and Portugal’s 9.4 percent.

More trouble in the fringes of Europe

While the world breathes a sigh of relief that Moody's didn't join Fitch and S&P in downgrading Greece debt to junk, trouble is brewing elsewhere.

For instance, Latvia's budget situation is reaching crisis levels again.

Latvia's constitutional court Monday struck down pension cuts that form a key plank of an austerity drive, casting doubt on a crucial IMF and EU-led bailout for the recession-hit Baltic state.