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Tue Jan 24, 2012, 07:18 PM

IMF's Lagarde: Greece's Default Not An Option

PARIS (Dow Jones)--The head of the International Monetary Fund said Tuesday a default by Greece was not an option, even as negotiations between the debt-laden country and its creditors appeared to be deadlocked.

The default of Greece "would not be envisageable," IMF Managing Director Christine Lagarde said, speaking in an interview with French television channel France 2.

Still, markets are increasingly expecting Greece to default on its debt obligations. Negotiations between private bondholders, Athens and euro-zone officials on financing and debt write-downs are gridlocked. Time is quickly running out for a deal to be done, as Greece faces a EUR17.5 billion in bills and bonds coming due in March.

The IMF fears that a default in Greece could cause borrowing costs to shoot up in other ailing euro-zone countries, such as Italy and Spain, to levels that require bailout loans. Also, the fund says euro-zone banks don't have enough cash on hand to cover losses from a Greek default, and the subsequent mayhem could create another global financial crisis.

more: http://online.wsj.com/article/BT-CO-20120124-712827.html

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I think there will be a deal eventually to avoid an ugly uncontrolled default but regardless whatever deal comes out of this it wont be pretty.

5 replies, 1009 views

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Reply IMF's Lagarde: Greece's Default Not An Option (Original post)
DCBob Jan 2012 OP
Fool Count Jan 2012 #1
DCBob Jan 2012 #2
Prometheus Bound Jan 2012 #3
DCBob Jan 2012 #4
Nye Bevan Jan 2012 #5

Response to DCBob (Original post)

Tue Jan 24, 2012, 07:27 PM

1. For those not fluent in banker-speak translation:

 

"Greek default is an option".

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Response to Fool Count (Reply #1)

Tue Jan 24, 2012, 07:31 PM

2. Actually I think its a warning to all those involved they need to get this done or else..

shit is going to hit the fan.

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Response to DCBob (Reply #2)

Tue Jan 24, 2012, 08:09 PM

3. Yes, this is much more about Italy and Spain than Greece.

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Response to Prometheus Bound (Reply #3)

Tue Jan 24, 2012, 08:13 PM

4. Yes, they dont really give a shit about Greece..

they just dont want it spill over into other risky nations and then the entire Eurozone and then the whole globe. They need a firewall around Greece.. but that is proving to be elusive.

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Response to DCBob (Original post)

Tue Jan 24, 2012, 08:20 PM

5. I hope her financial acumen is better than her taste in fake tans.

She seems to want to be the female John Boehner.

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