Beware of Greeks Bearing Bonds

courtesy of "Beware of Greeks Bearing Bonds" by Michael Lewis 

 1) choose one passage from the reading that you found particularly interesting. Why was it interesting?

 Before I read this article, I never heard Greece being in this situation. The passage that fascinated me was on paragraph 3 which the author, Michael Lewis, talked about his reasons for being in Greece at the time. It also talked about how "different societies were touched by the same event" but each response was different. Each society had their own say in the matter "financial-disaster tourism." The author did not go to Greece to church but because he had the "opportunity to travel" there.

2) Greece's economy is very small compared to other European Union economies, yet problems in Greece threaten the rest of Europe. Why?

I believe that Greece threatens the rest of European economies because they share the same currency. Because each economy is tied into one currency, it will affect all, making it depreciate or appreciate if the economy is not going well as expected.

3) As a part of a European bailout, Greece agreed to an austerity program of large cuts in government spending and increases in taxes. The Greek public has strongly opposed these measures. Use the short-run National Income model (discussed earlier in class) to explain this opposition.

There would be a decrease in government spending, the increase in taxes will lower consumption rates, which the GDP therefore goes down and cut services applicable to the country.