Mission Statement

The mission and goal of LeftWingCapitalist is to conduct and publish critical analysis of political, social and economic issues that are important to the American people.  Comments--pro and con--are welcome and encouraged.

This will be done in a manner that is informed, respectful and without prejudice, while acknowledging the reality that I, the author, possess an existing political affiliation and governmental philosophy.  My analysis will rely on verifiable facts, historical context and the human condition that encompasses the issue of the moment.  A sense of humor is important, but this posting is no joke!

Scenes from Greece Part 2

Greece will probably default in some way on its sovereign debt.  Is this really important to us?  Yes, and here's why:  this default is going to be expensive.  It will be more expensive for European taxpayers and investors than it will be for anybody else, but it will still be expensive for American taxpayers and investors, and probably also for many others around the world.  And there are some lessons to be learned that have value in the American context.

By the time you reach the end of this posting you might want to pour yourself some of that potent Greek ouzo.  Drink it cold and neat and let it settle for a lengthy time before trying to get up and move again.

This is not going to be like Argentina defaulting on its debt a few years ago.  Argentina's financial system stood on its own, even though its debt was owned internationally; Greece's financial system is intimately and intricately tied into all of Europe's financial system by way of its sixteen partner nations in the euro zone, as well as having debt owned by banks all over Europe and perhaps elsewhere. 

And some of that debt--whether through direct ownership or indirectly via investments in institutions that themselves own that debt--will drag down American banks.