The Son of Finance of the Great Age

  Chapter 746 Greece's downgrade (2)

"The current government announced that this year's fiscal deficit is expected to account for 12.7% of GDP, which is a slight increase of 1.5% over the previous year. In terms of public debt, it will account for 113% of GDP, which will be For the second time in this administration public debt has exceeded 100%."

"At the government's press conference, Prime Minister Kostas Karamanis detailed the sources of these debts, mainly the state-owned economy and welfare expenditures. Karamanis said that expenditures in this area will be cut within the next year, and as soon as possible Greece's fiscal deficit and debt ratio meet the requirements of the Stability and Growth Pact."

"Market analysis shows that it will take at least three years for Greece's financial situation to improve. Before that, they must remain attractive enough to borrowers. However, based on the tradition of default by successive Greek governments, this is the most difficult The other is the austerity policy announced by Karamanis. If he cannot properly handle the relationship with various trade unions and the austerity goal cannot be achieved, Greece will fall into a difficult situation.”

"With the demonstrations that broke out today, it is conceivable that there will be successive strikes in the future. How to deal with this relationship is a top priority for this government. In the future, how to gather confidence from the market and how to Getting rid of the severe debt crisis is the top priority. I personally think that it is imminent to promote marketization, reduce benefits, delay retirement age, and sell state-owned assets.”

  On the TV, guests in suits and leather shoes interacted with the pretty hostess.

   On the big screen behind them, live footage of demonstrations was being played, and the red words "oppose layoffs" and "punish corruption" were particularly glaring.

   "You achieved your goal..."

  After translating all of this for Zhong Shi, Phaedra Gale said in a low voice, "Are you satisfied now?"

"satisfy?"

  Zhong Shi looked at the other party in surprise, "No, I don't agree with your statement!"

   After asking a few more questions, Zhong Shi’s exclusive interview was over. After exchanging pleasantries with everyone, Fedora Gail escorted Zhong Shi out. When he was walking to the exit of the gate, the content played on the TV on the wall attracted Zhong Shi's attention.

   On this day, the Greek government held a press conference to announce last year's financial situation to all walks of life.

   "Are you still not satisfied?"

  Phaedra Galton became angry immediately, stared at Zhong Shi with rounded eyes, and asked Zhong Shi in a high-pitched voice, "What else do you want? Are you crazy?"

   "Do you think I'm a troublemaker?"

  Facing the other party's sudden outburst, Zhong Shi just smiled slightly, turned his head to look around, and walked outside, "Or, do you think I am a person like Soros?"

   "I didn't say that, you said it yourself!"

Seeing Zhong Shi's actions, Phaedra Gail also realized his gaffe, so he couldn't help lowering his voice, walked out behind Zhong Shi, and said as he walked, "You also once said, you have to learn Study society like Soros. It is because I have little experience and inexperience that I actually believe in people like you. Today I really realized that if it really develops as you designed, Greece will probably fall into a situation where there is no redemption .”

   "I caused all this?"

  Zhong Shi stopped suddenly, turned around and looked at Phaedra Gale, and asked in an unquestionable tone, "Without my participation, wouldn't these questions exist? Answer me!"

   "..."

  Phaedra Galton was at a loss for words.

  He turned his thoughts sharply, and suddenly realized that even without the participation of Zhongshi, the situation Greece is facing now is an objective existence. In other words, the stalactite at most only played a role as a catalyst.

  When he thought of this, he couldn't say a word.

"Soros is most notorious for shorting the currencies of Southeast Asia, but you have to understand that before Soros was short, those countries in Southeast Asia had serious problems with their currencies. First there was a problem, and then people like us found the problem , Accelerated its outbreak, which led to the subsequent currency crisis.”

Zhong Shi said lightly, "Not only in Southeast Asia, but even in the United States two years ago, the problem was the same. We are not troublemakers, we just discovered the problem earlier than others, that's all. So if you combine all If the crime is placed on me, I'm sorry, I can't bear it!"

   The corners of Phaedra Gale's mouth twitched slightly, but he was still speechless.

"Since you are talking about Greece, let's talk about Greece. First of all, the politics of Greece are basically dominated by two families, the Papandreou family and the Karamanis family. You know this better than me. Secondly, in the whole In the wave of global privatization for eighty years, Greece did not advance but retreated and carried out large-scale nationalization, which went against the trend of the world and has dragged the entire economy into the abyss of dullness and inefficiency.”

“You can say that these were all pre-euro accession. But do you think joining the euro area will solve these problems? Perhaps you know better than me that before joining the euro area in 2000, Greece’s fiscal deficit suddenly became 1% of GDP, there are tricks in it. These tricks are also a thing of the past, needless to say. But what is the essence of Greece’s economic growth in the past few years, you, a local financial reporter, should understand better than me. For a period of time, the growth rate was as high as 4%, but these growths were accumulated by borrowing. Because of the credit guarantee in the euro zone, there are institutions and countries in the market that are willing to lend money to Greece, and you should be very clear about this.”

"However, it is harmful to borrow money to develop, especially when Greece loses its right to issue currency. Because all this is based on the fact that the economy is developing well, the prospects are bright, and the Greek government has the ability to repay. But if all this If it ceases to exist, the capital will turn its face and deny people, and you may see this scene soon!"

Zhong Shi shrugged and made a helpless expression, "The system of high welfare needs a highly developed commodity society as support. But for Greece, the level of economic development is obviously not up to this level. Yours Workers receive higher retirement salaries than Germans, but the retirement age is eight years earlier than Germans, all of which are the root causes of today's problems."

   "May I ask what's next?"

   After being silent for a long time, Phaedra Gale said with difficulty, "Will we fall into a recession like those Far Eastern countries?"

   "Recession?"

Zhong Shi gave the other party a strange look, shook his head and replied, "You are thinking too simply. Recession and depression are inevitable results, and default is also inevitable. The current situation is to see if other countries in the euro zone are willing to Greece has been rescued. If they cannot reach an agreement, Greece’s exit from the euro zone is not empty talk. If it really exits the euro zone, Greece wants to repay its debts with its own currency, or recover from its predicament. It’s even more difficult now.”

"can not avoid?"

  Phaedra Gale still did not give up, and continued to ask, "Is there really no other way?"

   "Of course! Maybe several funds can join forces to save Greece. You must know that the money needed is not a lot, and it is only a few hundred billion euros!"

Zhong Shi laughed, "But why do others want to save it? You must know that in this society of equal exchange, if you can't pay enough, others will not easily sell it. Moreover, it is impossible to count on this kind of sovereign debt. Individuals or institutions take action. Perhaps the Greek government should consider asking for help from the euro zone!"

   While talking, he took out his mobile phone, which had been vibrating in his arms for a long time.

"it's me!"

  He didn't shy away from the presence of Phaedra Gale, and said directly, "What? It's all done? When will it be released?"

"okay, I get it!"

  The other party mumbled a few words, Zhong Shi nodded, and then hung up the phone.

"This is…"

Phaedra Gale only heard these few words, but based on the timing of the call and Zhong Shi's words, he realized that the call might be related to Greece's debt situation, so he immediately asked without thinking, "What did you arrange?" Follow-up move?"

   At this time, he was no longer angry with Zhong Shi, because he knew very well that everything Zhong Shi said was true. Compared with the full and efficient marketization of other countries, Greece's economic operation model is notoriously inefficient and backward. This is well known. He is also very aware of the matter of borrowing for development. After entering this vicious circle, some people have worried about this issue. But when the economy was developing well, many people chose to ignore it until now it broke out.

  He is very curious now, since Zhong Shi has chosen to short Greece, besides agitating demonstrations, what follow-up tricks will he use.

   "You are a reporter!"

Just patted him on the shoulder, Zhong Shi got into the car with a smile, rolled down the window, and replied with a smile to Phaedra Gail who was still confused, "The news will not be too late, I believe you will soon will know!"

  The car slid out without a sound, and soon disappeared without a trace.

Still reminiscing about Zhong Shi's inscrutable smile, Phaedra Gale thought for a while again, but still had no idea, and could only return to the office full of doubts, but when he walked to the office area, I saw that everyone was in a mess.

"What happened?"

  Phaedra Gale casually pulled a person passing by him, and asked suspiciously, "What happened?"

   “We got demoted by S&P!”

   This is a young man with a huge body. Because of his excessive weight, Phaedra Gale almost didn't hold him. The young man turned his head and glanced at him, looking at him strangely, as if he was looking at an alien, "Our country's credit rating was lowered by one level by Standard & Poor's just now. I'm going to make a news release Please, please give way!"

   "So it is!"

  Phaedra Gale let go of his hand, and he couldn't help but underestimate this young man. Because just at the beginning of the year, Standard & Poor's lowered the credit rating of the Greek government from A to A-. In Fedora Gale's view, this is not a big deal.

  About S&P ratings, A means that the debt repayment ability is relatively strong, but compared with higher-rated debts/bond issuers, its debt repayment ability is more susceptible to adverse factors in the external environment and changes in economic conditions. The +/- is a minor adjustment to the level.

  But when he sat back in front of the computer and checked the relevant news, he realized that the whole thing was not what he thought. Standard & Poor's did not lower the credit rating of Greece's sovereign bonds to the next level BBB+, but directly adjusted it to BB-, that is, directly lowered it by two levels.

This means that, in S&P's view, the Greek government has the lowest probability of default relative to other speculative-grade ratings, but in the event of sustained, significant circumstances or adverse commercial, financial, or economic conditions that may render the issuer insufficiently capable repay loan.

   "It suddenly became a junk bond!"

  Phaedra Gale's hair stood on end, he took a breath of air, and his hair went numb. Only then did he realize that the whole matter was far more serious than he thought!

   PS: Happy New Year to all book lovers! In the past year, we have all experienced a lot. Although each of us is a small existence to the whole society, to us individually, we are all. In the past year, there were laughter, tears, regrets, and satisfaction. We tasted the ups and downs of the world, and lived bravely and tenaciously in the world. But all this must pass, we applaud ourselves, applaud ourselves. In the new year, we still have to work hard for ourselves. I wish every book friend all the best in the new year. Having said so much, I would like to thank so many book friends for voting for monthly tickets today, and finally ask for a count of votes with the cheek...

  (end of this chapter)