So let me see if I have this straight…
American banks invented really dodgy credit products, which they sold to people they knew couldn’t afford to pay them back, and then sold the liability on to other banks, many of which were in other countries. When we discovered just how dodgy the products were a large part of the house of cards came tumbling down and, because so much of the debt was held overseas, the US problem spread globally.
But initially, they had thought this was a really good idea, so a deade ago they (Goldman Sachs) taught the trick to the Greek Government, who’d asked for financial advice. The Greek government parcelled up all their toxic debt and sold it on to the rest of Europe (and used the profit to fund massive public spending, which is why Greeks are happier than Americans, or were, until the Government tried to take it all away).
The rest of Europe was apparently savy enough to sell the debt on again, just in case, and, because it’s entirely unregulated, no one knows who it is who’s watching the Greeks riot with their fist in their mouth, their blanky on their knee and their therapist on speed dial while the country circles the default drain.
Round and round and round it goes, where will it end? Nobody knows!
The smart money, however, is on those same American banks who created the whole mess in the first place… which would be some sort of poetic justice if it wasn’t for the fact that they will hurt a lot of innocent people if (when?) they fall.
On the other hand, it was the so called “smart money” that created the problem in the first place, so perhaps we should just wait and see.
