WorldPost Illustration/Getty
The world was rattled this week by the busted stock market bubble in China and by the "no" vote in Greece last Sunday against austerity policies aimed at reducing the country's unpayable debt.
Yet, by week's end, Prime Minister Alexis Tsipras appeared to cave in and say "yes" to the very austerity measures voters had rejected in return for a fresh $59 billion bailout package. After $3.2 trillion of value was wiped outby midweek, the uncharacteristically uncertain hand of the Chinese authorities intervened to stop the crash in a stock market they had cheered to ever greater heights over previous months. Meanwhile, the leaders of the BRICS countries met in Russia to bolster plans for their New Development Bank -- which rivals the World Bank -- and declared they would coordinate policies to keep their economies stable amid all the turmoil.
Mohamed El-Erian, one of the most influential voices in the global bond market, writes that the link between the Chinese and Greek crises is the stimulative policies of central banks around the world that have led to a debt buildup and created a gap between the inflated value of financial assets and the real economy.
From Chengdu, WorldPost China Correspondent Matt Sheehan surveys the attitude of people on the street about this week's stock market crash. Nobel laureate Muhammad Yunus writes how the new BRICS bank can avoid making the same mistakes as the World Bank.
In an interview, London School of Economics professor Paul De Grauweexplains what is behind Tsipras' post-referendum U-turn and what it means for Greece going forward. Writing from Paris, Jacques Delors, the former president of the European Commission and a strong proponent of federalism, tells the Greeks that their democratic legitimacy does not "take precedence over the democratic legitimacy" of other European nations. French philosopher Bernard-Henri Lévy scores the Greek referendum as more an action of mobocracy than democracy.
Writing from Athens, Andreas Papandreou says Greece needs European rules to force reforms that its clientelistic politics have continually blocked. Also writing from Athens, Michael Skafidas recalls the hopefulness and celebrations when Greece first entered the European Economic Community back in 1981, and reports that some pensioners now find the situation "darker than during the dictatorship." Our World editors look at what a Greek pensioner's 120 euros buys and what it is like for ordinary Greeks to live with bank closures and ATM controls.
Nicolas Berggruen and I argue that the Greek crisis has revealed a "double truth" that an "ever closer union" in Europe can only be reached if all agree to the rules of supranational sovereignty, but for Greece to follow those rules will only entail further economic depression. We thus call for a "two speed" Europe in which Greece leaves the eurozone but remains in the European Union.
IMF economist Olivier Blanchard defends the Fund against criticism of its Greek policies. Writing from Dublin, Karl Whelan notes that pushing Greece out of the eurozone will minimize, not maximize, the chance that its creditors will be paid back. Antonio Roldán Monés fears that the ripples of a Grexit will hit other economies in the periphery of Europe that are vulnerable. HuffPost Spain editor Montserrat Domínguez wonders whether Europe's leaders are prepared for "the light-speed contagion" of Syriza's rebelliousness in Spain, Portugal and Italy. Angela Mauro reports from Italy on how the "new left" around Europe rejoiced at Syriza's "no" victory.
Writing from Rome, HuffPost Italy editor Gianni Del Vecchio says Europe's fate is now in the hands of Berlin and Paris, a sentiment echoed by HuffPost Greece editor Pavlos Tsimas. Development economist Jeffrey Sachs warns that "a corpse can't carry out reform" and calls for a package of simultaneous debt relief and reform commitments. Writing from Paris, the founding president of the European Bank for Reconstruction and Development, Jacques Attali, charts out a four-point plan to keep Greece in the eurozone and reminds Europe's leaders that there is no ultimate resolution until the single currency union is completed with a banking and fiscal union. Daniel Marans reports on an innovative proposal from former IMF chief Dominique Strauss-Kahn for a two-year debt payment moratorium that would give Greece some breathing space for reforms. He also looks at how German comedians are making fun of the absurdity of austerity policies in Greece.
Yet, by week's end, Prime Minister Alexis Tsipras appeared to cave in and say "yes" to the very austerity measures voters had rejected in return for a fresh $59 billion bailout package. After $3.2 trillion of value was wiped outby midweek, the uncharacteristically uncertain hand of the Chinese authorities intervened to stop the crash in a stock market they had cheered to ever greater heights over previous months. Meanwhile, the leaders of the BRICS countries met in Russia to bolster plans for their New Development Bank -- which rivals the World Bank -- and declared they would coordinate policies to keep their economies stable amid all the turmoil.
Mohamed El-Erian, one of the most influential voices in the global bond market, writes that the link between the Chinese and Greek crises is the stimulative policies of central banks around the world that have led to a debt buildup and created a gap between the inflated value of financial assets and the real economy.
From Chengdu, WorldPost China Correspondent Matt Sheehan surveys the attitude of people on the street about this week's stock market crash. Nobel laureate Muhammad Yunus writes how the new BRICS bank can avoid making the same mistakes as the World Bank.
In an interview, London School of Economics professor Paul De Grauweexplains what is behind Tsipras' post-referendum U-turn and what it means for Greece going forward. Writing from Paris, Jacques Delors, the former president of the European Commission and a strong proponent of federalism, tells the Greeks that their democratic legitimacy does not "take precedence over the democratic legitimacy" of other European nations. French philosopher Bernard-Henri Lévy scores the Greek referendum as more an action of mobocracy than democracy.
Writing from Athens, Andreas Papandreou says Greece needs European rules to force reforms that its clientelistic politics have continually blocked. Also writing from Athens, Michael Skafidas recalls the hopefulness and celebrations when Greece first entered the European Economic Community back in 1981, and reports that some pensioners now find the situation "darker than during the dictatorship." Our World editors look at what a Greek pensioner's 120 euros buys and what it is like for ordinary Greeks to live with bank closures and ATM controls.
Nicolas Berggruen and I argue that the Greek crisis has revealed a "double truth" that an "ever closer union" in Europe can only be reached if all agree to the rules of supranational sovereignty, but for Greece to follow those rules will only entail further economic depression. We thus call for a "two speed" Europe in which Greece leaves the eurozone but remains in the European Union.
IMF economist Olivier Blanchard defends the Fund against criticism of its Greek policies. Writing from Dublin, Karl Whelan notes that pushing Greece out of the eurozone will minimize, not maximize, the chance that its creditors will be paid back. Antonio Roldán Monés fears that the ripples of a Grexit will hit other economies in the periphery of Europe that are vulnerable. HuffPost Spain editor Montserrat Domínguez wonders whether Europe's leaders are prepared for "the light-speed contagion" of Syriza's rebelliousness in Spain, Portugal and Italy. Angela Mauro reports from Italy on how the "new left" around Europe rejoiced at Syriza's "no" victory.
Writing from Rome, HuffPost Italy editor Gianni Del Vecchio says Europe's fate is now in the hands of Berlin and Paris, a sentiment echoed by HuffPost Greece editor Pavlos Tsimas. Development economist Jeffrey Sachs warns that "a corpse can't carry out reform" and calls for a package of simultaneous debt relief and reform commitments. Writing from Paris, the founding president of the European Bank for Reconstruction and Development, Jacques Attali, charts out a four-point plan to keep Greece in the eurozone and reminds Europe's leaders that there is no ultimate resolution until the single currency union is completed with a banking and fiscal union. Daniel Marans reports on an innovative proposal from former IMF chief Dominique Strauss-Kahn for a two-year debt payment moratorium that would give Greece some breathing space for reforms. He also looks at how German comedians are making fun of the absurdity of austerity policies in Greece.
