Monday, January 30, 2012
The Greek economy is not productive enough to generate growth
Welcome Forex Insight Community members. I ran accross this article I wanted to share with all our traders. It is a really insightful article and as we have mentioned on commentary in our Daily online room and fundamental trade courses.
Please READ ON and here is link to Spiegel
Spiegel: "Greece has been living beyond its means for years," an unpublished study by the German Institute for Economic Research (DIW) concludes. "The consumption of goods has exceeded economic output by far.
" Especially devastating is the assessment that the DIW experts make about the condition of an industry that is generally seen as a potential engine for growth: tourism. According to the DIW study, the Greek tourism industry concentrates on the summer months, with almost nothing happening throughout the rest of the year. There is almost no tourism in the cities, which translates into low overall capacity utilization and high costs for hotel operators. By contrast, capacity utilization in the hotel sector is much more uniform in other Mediterranean countries.
Resistance Mounts in Berlin This also applies to Merkel's center-right coalition government in Berlin, in which the first Greece package and the European Financial Stability Facility (EFSF) bailout fund were already hotly contested. Since then, resistance to additional German aid for debt-ridden countries has only grown. "Greece would be the most difficult decision by far for the parliamentary group," says Florian Toncar, the FDP's deputy parliamentary leader, who is a member of the party's pro-European wing. It is already clear that significantly more parliamentarians will refuse to go along with their leadership in the future.
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