Greece shocks markets with referendum on austerity

[n2doc]

By MATTHEW CRAFT, AP Business Writer

Tuesday, November 1, 2011

(11-01) 07:59 PDT NEW YORK, (AP) --

Worries that a planned Greek referendum could scuttle a plan to resolve Europe's debt crisis rattled markets Tuesday morning. The Dow Jones industrial average plunged nearly 200 points, and European stock indexes fell broadly. The dollar and U.S. government bond prices rose as traders moved into assets considered safe.

The Greek government shocked financial markets with news that it would put its unpopular cost-cutting plan to a public vote. If it's defeated, the country could drop the European currency and default on its debt, which would put the European banking system and regional economies at risk of another crisis.

"The Greek referendum puts the connections between European countries at risk, from free-trade agreements to the common currency," said Guy LeBas, chief fixed income strategist at Janney Montgomery Scott.

DJIA down 262 as I post

Read more: http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2011/11/01/national/a064527D07.DTL

I'm sure the Greeks couldn't give a rat's ass about our stock market. Eventually the Powers That Be are going to be faced with the reality that people will not accept 'austerity' for the masses willingly.

[no_hypocrisy]

1. As much as I promote democracy, this decision to referendum seems

passive-aggressive toward the big picture. Banks and global markets can fail, waiting for the results of the election. There really isn't time for a show of hands.

[dkf]

4. In a way it is a hostage situation. The Greeks figure they can be the suicide bomber

and demand funding from a world worried about instability.

[valerief]

2. Secret software electronic voting? nt

[dkf]

3. Obviously the Greeks have no intention of living within structures a union requires.

They will kick the Germans in the teeth as they use their money. I can't see a European populace who will want to help the Greeks out, especially people like the Slovaks who have a lower standard of living.

[safeinOhio]

5. Iceland example?

[leveymg]

6. Bailouts unsustainable. Markets find their natural bottoms eventually, no sense in propping them up

Austerity for Wall Street, for a change.

[dkf]

7. If you say that about housing you will get an earful.

[jtuck004]

8. Doesn't make it incorrect.

It might be better to let it all go - we are looking at perhaps decades of no growth when growth is the only thing that will save us.

We could lose a lot more during that time trying to prop up a system that's already failed.