from The Sleuth Journal:
Greece is Exhibit A on how financial predators wreck economies for profit. Force-fed austerity is toxic, polar opposite what’s needed.
Weak economies need stimulus to stabilize, recover and grow – expansive monetary and fiscal policy. Euro straightjacket rules prevent member countries from controlling their own financial policies. It’s like having weapons with no ammunition when trouble strikes.
Greece’s manufacturing index is a testimony to wrongheaded euro policies. It July, it sank at a record pace – from a negative 46.9 in June to a dismal 30.2 in July.
Readings below 50 signify contraction. Greece’s new orders gauge showed no relief in sight – plunging from 43.2 in June to a record 17.9 in July.
Markit Economics blamed capital controls and a “generally uncertain operating environment. Although manufacturing represents only a small proportion of Greece’s total productive output, the sheer magnitude of the downturn sends a worrying signal for the health of the economy as a whole. Bank closures and capital restrictions badly hampered normal business activity.”
Since crisis erupted five years ago, Greece’s economy slumped over 25%. After reopening for the first time since June 26, Greece’s stock market crashed – down 23% in early trading, closing around 20% lower than when trading began with perhaps more declines coming before stabilizing.
A halt in short selling was declared. The benchmark National Bank of Greece plunged 30% – the daily limit. Other bank valuations followed.
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