The New York Times. “Greece’s Debt Crisis Explained. International Business.” The New York Times, 21 Sep. 2015. Web 02 Oct. 2015.
The article “The Greek debt crisis explained,” notes that Greece’s debt misery has been a protracted problem that has faced the country since the 2009 financial crisis. The article adds that the situation had escalated over the summer after doubts by creditors over the country’s ability to repay its loans following two financial bailouts from IMF and European states.
Having rejected early terms of financial assistance package, Greece Prime minister, Alexis Tsipras was forced to accept a new package to avoid default. This means he will have to take tough economic actions such as austerity measures, increased tax on goods, and other financial policy changes for additional 86 billion Euros amidst skepticism by creditors that he will need to secure the financial support. Thus, thus article summarizes the Greece economic turmoil from the onset to current situation and its implications on global economy.
Critique and lessons learned
The article notes that Greece’s financial crisis is unlikely to affect the Euro zone, despite budget and tax policy decision-making being left to European members to manage. I agree with the writer that such policies are necessary and should be regulated from a central point, because the Greek crisis has exposed a structural problem of the Euro zone that has been questioned by the expert in the past. That is the imbalance between full centralization of monetary policy and the preservation of most economic policy instruments at the national level.
While the article notes that Greece will have less financial implications on the global economy if it default and that will not affect stability of other European states. This is due to the fact that Greek debt is held by the public sector that includes the IMF, ECB, and other European governments hence, this will reduce the contagion risk since private sector creditors are not over-exposed to the high risk debt. I am of the contrary opinion that, if Greek is left to default it can lead to contagion, which will affect other government bond markets in the euro zone. Such a contagion to other government bond markets will affect the banking sector in the euro zone.
While the article explains the crisis (it does touch on the cause of the Greek crisis and what the future holds for the Greece), it fails to note that the main cause of the Greek crisis was due to revelation of statistics hidden from the citizens due to corruption, tax evasion, and over-borrowing. This is the reason why the bailout money that went to repay loans accrued an international loan, rather than pumping funds into the economy.
Thus, this article is useful in the economy and management of resources since Greek over-expenditure on borrowed money came to haunt them.
The second news article
Peter Coy and Karen Weise. ”young Americans are giving up on getting Rich. Bloomberg Business week. 01 Oct. 2015 Web. 02 Oct. 2015
The article “young Americans are giving up n getting rich,” notes that low income, poor employment opportunity, and possible dim future make most young Americans to lack hope. As a poll by Bloomberg suggests, 18-35-year olds do not think that their group prospects will outlive their parents. As 15% of them aged between 25-30 are housed by their parents. The cost of houses and harsh credit lending have locked majority out and are unable to start life hence, continue to depend on their parents for support.
Critique and lessons learned
The article raising alarm over young adults’ poor investment is a good idea, though we cannot just conclude with the remark, since the finding is based on a poll contacted by the writers. In addition, they did not specify their methodology such as the population and sample size, which could be used to gauge if their finding was sustainable in relation to the number of those surveyed.
More so, the writers tend to contradict themselves, when after such alarming headline they posit that despite of debt, dormant wages and slow economic growth young people may yet find a path to prosperity. While it might be possible, the issue is whether they have already pronounced doom to the millennial with no apparent solution to the problem.
I agree with the poll that dependence on parents’ support keeps most young people from learning how to make their finances. Nevertheless, it is, at the same time, advisable for the parents to talk to their young adults and encourage them to invest in their future for most may not be ready or willing to take a risk without with no reason for doing so. Furthermore, I do not agree that lack of ownership may deprive one to knowing how to spend or save rather it depends on ones knowledge and exposure on the culture of saving since one cannot do so or realize if he is being pumped with everything like baby. Working hard with the support of parents will enable the millennial to be able to build a prosperous life.
While defaulting loans may be a problem to most young and adults, I do not agree with the findings that the young adults are likely to have a dimmer future compared to their parents due to such loans and dependence syndrome. Rather, I believe that they are likely to overcome this with time as they realize they have responsibilities to undertake.
While the poll is the supported by only survey statistics, the writers did not touch on remedies of overcoming such financial difficulties among the young adults.
In sum, this article is educative and will be useful not only to the young adults rather even to their parents, as it will be a wakeup call that will encourage the young adults to think about their future and begin investing and coming up with ways of countering unemployment.
Coy, Peter and Weise, Karen. ”young Americans are giving up on getting Rich. Bloomberg Business week. October, 1 2015. Web. 02 Oct. 2015.
The New York Times. “Greece’s Debt Crisis Explained. International Business.” The New York Times, Sep. 21, 2015. Web. O2 Oct. 2015.