Mumbai, February 20, 2012 : It seems Greece is going to get second bailout package in order to avoid default on March 20. Investors appeared increasingly optimistic that European officials would resolve remaining differences and a deal would be struck in Monday’s meeting where Finance ministers from the 17 nations that share the euro and other top European officials were meeting Brussels. But the real question is “Is this bailout will set all things right and is this the end of European Crisis?”
Actually going by history the commitment made by Greece even at the time of first bailout in 2010 remains unfulfilled and the kind of Austerity measure politician is imposing on ten of thousands of people it really needs to be seen that how Greece’s overall debt load cut to 120% of GDP by 2020, down from around 160% currently. Mathematically, It will make these target even more hard to achieve. when economy is in shrinking mode how can you reduce your debt-to-GDP ratio, many economist argues. The so called deal is also raising some fundamental question of treating some institution with Preference and hence it will induce other ailing nation to follow the same which will make problem more serious instead of bringing solution.
One thing is clear that nobody is ready to face the catastrophe that financial market will witness in case Greece defaults. It seems time only will tell that how many more such bailout packages will require in order to keep Eurozone as one united block.