Unforgiving Debt

Countries faced with uncomfortably high debt ratios have several options available to them. Monetisation, prolonged austerity and debt default clearly have lots of problems attached. Selling the family silver through privatisations is popular but its inherent unsustainability hardly commends it as a way of life. Cheating, by reclassifications of what is private rather than public debt, is also popular but you usually get found out – destroying any credibility benefits. Fiddling the books is more likely to raise risk premia than reduce them. Pleading for debt relief might work but Greece’s targeted, asset-windfall approach has to win plaudits for irony…
Greece Wants Germany to Pay War Reparations, Wall St Journal, 24 Apr 2013