I would predict that Greece will receive extensions on the debt it owes at lower interest rates. They will not write down any of the debt.
The chances of a Greek exit from the Euro remain low but the more often these kind of crisis occur the better the possibility that one side or the other will miscalculate.
The Greeks will hold another election within 18 months because the 35% that voted for Syriza will find out that throwing a hissy fit doesn't actually resolve the deeply entrenched and long standing issues which have led Greece to require repeated infusions of cash.
Germany, on the other hand, has been forced to see the error of its focus on inflation as a threat and will moderate it's dedication to Austrian school economics going forward.
|