Though many were taken by surprise by the Greek referendum vote, I certainly wasn’t, as I noted last Wednesday that my feeling was the measure would be rejected. While that was a relatively straightforward observation, what happens next is not….
Judging from the reactions of world markets, as of Monday mid-morning, they seemed to conclude that everything would still be OK, but I don’t really see how that could be the case. First of all, the powers that be who run the EU can’t grant any sort of relief to Greece without having to worry about doing the same for Ireland, Portugal, Spain, and possibly Italy. Second, even if a solution were possible, I don’t know if they will have enough time, given that Greece’s economy and banking system are on the verge of the functional equivalent of vaporization. Thus, I really don’t see what can be done to save the day.
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