U.S. Fears a European “Lehman Brothers”
By: GoldCore
GoldSeek.com
Tuesday, 5 May 2015
European complacency regarding Greek default and exit is high – Tett
Narrative to reassure investors that markets have already priced in effects of Greek default
U.S. Council on Economics is alarmed by risk being taken by European elites to bring Greece to heel
Greek default would cause a new and very “unpredictable” paradigm – huge uncertainty in markets
U.S. policy makers fear unforeseeable knock-on effects
Gillian Tett, markets and finance commentator and an Assistant Editor and former U.S. Managing Editor of the Financial Times, wrote an important and little noticed article last week questioning complacency on the part of European policy makers regarding a Greek default and potential exit or ‘Grexit’.
Tett wrote that statements out of Germany that Europe could manage a potential Greek exit and that markets had already priced in that eventuality had alarmed certain policy makers in the U.S.
The German stance was a reflection of their frustration with the lack of progress made over three months of talks with Greece and a consequent hardening of tone. However, U.S. officials are alarmed by the risk they see in European complacency to a Greek exit.
Tett is highly respected both in journalism but also in financial and economic circles. In her previous roles, she was U.S. Managing Editor and oversaw global coverage of the financial markets. In March 2009 she was Journalist of the Year at the British Press Awards. In June 2009 her book ‘Fool’s Gold’ won Financial Book of the Year at the inaugural Spear’s Book Awards.
In 2007 she was awarded the Wincott prize, the premier British award for financial journalism, for her capital markets coverage. She was British Business Journalist of the Year in 2008.
Tett quotes Jason Furman of the U.S. Council on Economics as saying that a
“Greek exit would not just be bad for the Greek economy, it would be taking a very large and unnecessary risk with the global economy just when a lot of things are starting to go right”.
The Rest…HERE
