Confused about the ever changing Greek tragedy and what’s being done about it? One of our experts on the subject, Geoffery T. Smith, has put together a Q&A which aims to answer your questions.
Q: What’s all this about Greece’s bailout having to be revised?
A: The situation is much worse than people realized in July, when euro-zone leaders and the International Monetary Fund thought they had found a formula for bringing Greece’s debts down to a manageable level. The old assumptions don’t hold any more, so a new plan is needed.
Q: Haven’t I heard this one before?
A: Sort of. The July deal only became necessary when it became clear that Greece was missing most of the targets set out in the original bailout deal from 2010.
Q: What was agreed in July?
A: The official creditors—that’s the IMF and the governments of the euro zone—decided to carry on lending to Greece for longer, and to give it up to 30 years to repay, instead of the seven originally agreed. Also, representatives of the private-sector creditors, mainly banks, agreed to swap some of the bonds they hold now for new ones on terms that were likewise more favorable to Greece.
You can read the full article @ WSJ