Stocks Tumble On Renewed Fears Of Greek Default

US markets fell 200 points on news that Greece could be on the precipice of defaulting on its debt. Wait, haven’t they been talking about that all summer? Yes, but this comes after the Germans, key players in resolving the crisis, are now publicly saying that Greece may default in a messy way.

Slides were set off on Friday after a key German official at the European Central Bank resigned in protest of the bank’s bond-buying program as a means to shore up Greece. This also signaled internal division at the Central Bank over key policy matters, adding more froth to the uncertainty sloshing around the markets.

And Monday, German Economy Minister Philipp Rösler wrote in an opinion piece the Die Welt newspaper that an “orderly default” for Greece, rather them being able to cut debt and raises taxes to pay their bills, is now on the table.

However, stabilization could be coming as ECB President Jean-Claude Trichet announced this morning that Greece had received a favorable assessment by IMF inspectors, paving the way for approval for an $8 billion bailout of Greece funded by the ECB/EU/IMF. The question now is whether the rest of Europe will agree to the bailouts proposed in July. If not, these guys will be sharpening their plastic swords.

Fresh Worries About Europe Shake Global Stock Markets [NYT]
ECB Trichet: Anticipate Satisfactory Troika Review For Greece [ForexLive]

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