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Greece is very close to losing all international trust

23 November 2009 / 09:11:00  GRReporter
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International stock exchanges slowed down their progress after a stock fall of big banks and price fall of oil. Dow Jones closed the week with loss of 0.2% or with 10318 points. Nasdaq fell with 1.7% and closed on Friday with 2145 points. S&P 500 also lost about 1% and closed with 1091.4 points. Nikkei lost 2.9% and reached 9497.5 points. FTSE 100 closed with loss of 1.5% and closed the week with 5156.2 points. The Athenian stock exchange lost nearly 8% after the trust of investors in the Greek economy hit the bottom – Greece fell to 71st place in the competitor ranking of the World Economic Forum and is after Egypt and Botswana.

Another reason for the fall of the Athens stock exchange is the collapse of the stock prices of big banks – the European Central Bank doubts any future financial support of Greek banks. During the last year the ECB has loaned nearly €42 billion to Greek banks. After the news the National Bank of Greece stocks fell with 7%, Alpha Bank with 3% and Eurobank with 7.5%.

Daily Telegraph reports that “Greece is in such bad economic condition that it can’t even hide behind the underdeveloped South of the Eurozone” – meaning Spain and Italy. Jean-Claude Trichet believes the same – according to him the Greek economy is “very close to losing all trust”. The article refers to data from the tourist sector – 20% income fall for 2008 when Turkey reported growth for the same period.

Great Britain is also worried about its financial position. This helped the increase of the Euro with 90 pence for a Pound. As in Greece in Britain the national debt is getting out of control and it can lead to lowering the credit rating of the country – for the first time in the history of kingdom. On the other hand Great Britain is not in a state of recession anymore, as are most of the Western European countries.

Eastern Europe will need to wait before hearing such good news. According to ECB “this will be the region with the slowest economic growth in the world.” Analyzers from PriceWaterhouseCoopers said that countries like Bulgaria and the Baltic Republics, who rely on foreign capital, will suffer the most. “Poland, Slovakia and the Czech Republic – which are most independent, will be able to look towards the future with optimism.”

Tags: Greek economy Budget deficit in Greece Economy news stock news
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