The world market has seen some incredibly turbulent times in the last few years. AS things have started to level out the countries begin to pick up the pieces of a shattered market, some road bumps have proven to risk throwing everything back into a downward spiral. Spain and Greece’s economic woes have risked throwing a collective Eurocentric union back into chaos. As member states within the union squabble over whether or not to bail out Greece, it’s been made all the more apparent that the world simply can’t let Greece’s economy default.

Several years ago when Europe switched over to the Euro, it drafted a union with a powerful economy, strong currency, and united collective that brought nations together and inspired other parts of the world to make similar approaches. Yet, it seems that, with a collectivist approach, what makes you strong as a union also makes you week. As Greece begins its spiral into national bankruptcy, they risk bringing down the entire house of cards. Just as the American market had companies that were too big to fail, Greece is proving to be a similar situation. The world simply can’t afford that. Our economies are so closely tied together that when something happens in Europe, it affects America and everyone else. The same goes in reverse. If Greece defaults the following will happen:

• If Greece defaults on it’s debt, which is substantial, every bank in the entire country will immediately go insolvent.

• At this point, in reaction, the government will then nationalize every bank in the country.

• If this happens, then the government will forbid any withdrawals from the banks. At this point, in order to prevent any depositors from rioting on the streets, subsequent curfews will be set in place and possible martial law will be enacted. It happened before in Argentina.

If the country defaulted it would lock up the entire economy and the banking system would quickly collapse because it holds billions of Euros in government debt. At this point other governments would refuse to lend to Greek banks and would cut off its lifeline. Right now Greece is living on debt. The country has taken steps to begin paying back the money that it’s borrowed from the EU but this has only seemed to make matters worse. This is because a massive portion of the Grecian economy is dependant on government spending. In order to pay back the money quicker, the government slashed spending but these huge budget cuts has thrown the country into depression.

If Greece looses its liquidity then there would simply be no money to go around. The subsequent effects would go far the troubled country’s borders. All of the bonds and credit would become worthless and every banking institution and country that lent Greece any money would have to write down or totally write off the value of the debt. It would look very similar to the banking failure of 2008, which spiraled the entire western hemisphere into foreclosures, job losses, and monetary devalueization. The American, and world market, has seen positive signs forward with stronger home sales brought about by better lending habits and competitive VA Refinance Rates. It’s the biggest fear that Greece could begin a domino affect that would undo all that progress.

The biggest fear isn’t Greek’s default alone. It’s more about the message that it would send to other countries currently locked in a struggled to manage and pay off their own debts. Ireland has already started to renege on some of its bond payouts. This cascading number of defaults would ripple through the European banking sector, which would then hit all of the investments n America and throw the entire world into a depression that could last decades. The EU may not like it but the world simply can’t let Greece fail. This may not be an attractive situation for anyone but our economies are simply far too interconnected to take a individualistic stance.

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