February 26, 2010

Greek Profiteering?

Filed under: Uncategorized — Novak @ 6:04 am

          Yesterday, Federal Reserve Chairman Ben Bernanke announced that the Securities and Exchange Commission (SEC) will be looking into investment bank Goldman Sachs and other Wall Street firms.  Goldman Sachs and others face accusations of using certain financial instruments in order to profit in the event Greece defaults on its national debt.

          Many believe, such as Senator Chris Dodd of the Senate Banking Committee, that such speculative behavior is counterproductive and wrong.  A large bet that Greece will fail to pay its loans would serve to destabilize the nation even further, as Greece has already seen massive unrest and constant rioting in recent weeks.  These fears are not unfounded.  Greece and much of the European Union have thickly intertwined economies.  A financial disaster resulting from a Greek default would send ripples through the economies of countries like France or Germany.  Some even argue that a Greek collapse would cause a domino effect on the already weakened global economic system and may even be felt here in America.

          We cannot be sure about any of the effects of such a complex occurrence, but this situation serves as another context for the ever present battle between free enterprise and traditional American capitalism and big government regulation.  This battle, which has been so controversial lately, may well finally have a verdict in the fall.  The Congressional mid-term elections, more than anything else, will serve as a referendum on the big government ideal that has come to be the essence of the Obama administration to date.


1 Comment »

  1. First of all, thanks for your informative article. In my opinion, the GOVT should do something good for its economy because the market is not perfect itself.(I mean the market failure)

    Just hoping that the economic recession in Greece will not spread to the whole E.U., the U.S. and the world.

    Comment by abeljin — February 28, 2010 @ 5:54 am | Reply

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