Archive for July 22nd, 2011

FPS’ Friday Fiver

Hello All! It’s been another very heavy week of news, and equally heavy rain here in London – will summer ever raise its head again? Given the weather is playing havoc with any outdoor plans for the next few hours, we’ve put together another series of five key stories of the week from the world of financial and professional services. Thanks as ever to Ed, Mel and Jo for their contributions.

When is a default not a default?…Here are two rather intriguing and perhaps contradictory headlines for you from the same news website today: ‘Greece deal sparks bank-led European share rally‘, and ‘Fitch declares Greece default‘.

Greece - lives to fight another day

So which is it? The answer, rather confusingly, is both, depending on who you listen to. What isn’t in doubt is that eurozone countries have agreed another bailout package for Greece (though some have their doubts as to whether it’s big enough). This in turn, has sparked a market rally.

What also isn’t in doubt though, is that ratings agency Fitch have declared that because the deal involves private lenders ‘taking a haircut‘ on some of their debt, Greece has undergone a ‘restricted default’. At least in part. Confused? Quite possibly. What does it mean? That Greece continues to rage against the dieing of the light for a little longer, and that the other PIGS get some brief respite as well.

UPDATE – It seems we may have spoken too soon. According to Channel 4’s Economics Editor, Faisal Islam, Fitch is now not declaring Greece to be in restricted default.

Britain’s economy 2011 – what might we think in 2021?…What will be made of the Government’s economic policy in years to come? Will George Osborne’s approach be heralded as a masterstroke which got the nation back on its feet or criticised for paralysing the economy, engendering neither deficit reduction nor economic growth?

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