If only the Greeks were still on the Drachma they might be relatively okay. The government could devalue the Drachma and everyone could still have their pensions and wages and only the drachma would be worth less. And even though they are looking at a literal Greecian Great Depression almost anyway this thing comes out at least there wouldn't have been bloodshed like has happened.
There no longer appear to be any good outcomes for Greece at present. Hopefully, this can change in the future. I'm almost thinking that going back to the Drachma and defaulting their loans would be better for the people than this outcome. It wouldn't be good for the investors at all but I think that would be the most humane for the middle class and poor of Greece. Otherwise it could really be a physical bloodbath in the making right now.
BUT, here is where it gets serious for the world economy. If Greece defaults it would be 100s and 1000s of times worse then when Lehman Brothers collapsed in the U.S. So basically, all Countries in the European Union cannot afford to have Greece default(I don't believe) because this would not only cause Greece to default but set up the defaults of Portugal and Spain.
So, the best way to see this is like the European Union is finally in the same position as the U.S. was when Lehman Brothers Collapsed. If they let Greece default it could take down the Euro, the European Union and most of the European Economy of all European nations including Great Britain. If those economies all went down it would also take down the U.S. and Canada and Australia and if they went down so would India and China and many many others worldwide.
So, even though the European Union tends to move more slowly than the U.S. because it is dealing with Sovereign nations that only share a currency instead of states in the same country like the U.S. they are presently doing something like our T.A.R.P. bill did during the Bush Administration now.
Why, you may ask didn't they do it when we did? I think if both the U.S. and Europe had done it at the same time it wouldn't have been useful and might even have been counterproductive to North America, the world and Europe. So, the fact that they are creating their TARP Bill of sorts now is likely a good thing for the world long term.
To the best of my ability I write about my experience of the Universe Past, Present and Future
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- I tried to get a copy from France from French Wikipedia but it just took me back to English Wikipedia:
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