Tuesday, January 17, 2012

Fitch: Greece to Default, but in Orderly Fashion

According to Fitch, Greece will default on its debt, but in an orderly fashion.  In many ways, this is what we expected.  The "world economy" sometimes delays the inevitable, and then when the "big event" occurs, investors are "used to the idea" (so that there is not a tidal wave of trouble)...  At some point, we may all pay for the economic troubles, but we also believe that the world will "delay" and "inflate" its way past crises.

Rating agency Fitch said on Tuesday that Greece would default on its debt, although it said that such a default was likely to take place in an orderly manner.

The Parthenon in Greece
Scott E. Barbour | Getty Images

"It is going to happen. Greece is insolvent so it will default," Edward Parker, Managing Director for Fitch's Sovereign and Supranational Group in Europe, the Middle East and Africa told Reuters on the sidelines of a conference in the Swedish capital. "So in that sense it shouldn't be a surprise to anyone."
The Fitch comments come after Moritz Kraemer, head of Standard & Poor's rating agency's European sovereign ratings unit, said on Monday Greece would default shortly on its debt obligations.

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