The PIGS (Portugal, Ireland, Greece and Spain) have been under scrutiny for months due to their unsupportable mountains of debt in comparison to their incomes – on Monday, Greece may be the first to go down.
Despite Greek Priminister Tsipras’ plea for calm in this video:
Greeks lined up to drain ATMs of every ounce of cash they contained.
Reports say that Greece will not open banks on Monday at a minimum and it may take days or longer to get them open due to lack of cash.
Greece said it would temporarily close banks on Monday in a bid to prevent its banking system from collapsing after the European Central Bank moved to cap the amount of emergency loans it provides for the country’s cash-strapped lenders.
The ECB said earlier on Sunday that it wouldn’t increase the lifeline of emergency liquidity that has been sustaining Greece’s banks, even as nervous Greek depositors appeared to withdraw their money at a greater pace over the weekend.
Zerohedge is reporting that the Greek stock market may not open Monday. Without capital inflows, why would they?
This entire event is due to debt. Just debt. Nothing more than debt. It’s what happens when a nation offers services it cannot possibly pay fore and as Margaret Thatcher put it “eventually runs out of other people’s money.”
The United States should watch what happens to Greece closely as America’s debt-to-GDP is even worse than it looks. Remember that the government decided to include R&D and pension write-downs in GDP just recently. That only makes GDP look better while the government hides how bad American debt really is.