- Aug 23, 2009
GreeceIt is now common knowledge that there is a potential domino effect of European sovereign debt contagion in roughly the following order:
Greece → Ireland → Portugal → Spain → Italy → UK
While some people have been writing about this for well over a year, many others have joined the party late (there are now over 600,000 hits from a Google search discussing this topic.)
It is also now common knowledge that while Greece and Ireland have relatively small economies, there will be real trouble if the Spanish domino falls.
Iceland has the world’s 112th biggest economy, Ireland the 38th, and Portugal the 36th. In contrast, Spain has the world’s 9th biggest economy, Italy the 7th and the UK the 6th. A failure by one of the latter 3 would be devastating for the world economy.
The house of cards is coming down.
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