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    Posted June 16, 2012 by
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    Eye On Europe - June 16th - Greece, France, Egypt Votes


    This  weekend Greeks will go to the polls once again to choose a path for the  embattled nation. The choice is continued austerity and membership in  the Euro Zone or possibly rejection of austerity which may lead to  unceremonious expulsion from the EZ. What happens in Greece may impact  not just Europe, but reverberate around the world.

    There  are other issues as well. The French choose a new parliament which can  either give great power to the new President or move the nation in a  different direction. Meanwhile changing continents, a contentious  election for president is also taking place in Egypt, which is once more  taking to the streets.

    The Greek Wars:

    As  Sunday's Greek elections approach, there's a rising consensus and  concern that the plebiscite could prove to be a Lehman Brothers moment  for Europe. That is to say, if the hard-left bailout-denouncing Syriza  party wins, it could set off a cataclysm in the markets, a chain  reaction that would set neighbors and then the whole world on fire.

    So is it September 2008 all over again?

    In  one sense, it's an apt analogy. In the summer of 2008, the powers that  be thought that, after a series of frustrating and partial bailouts of  the financial sector, letting a large, leveraged entity default on its  debts would have limited impact.

    The impact of a Greek default,  or of a Greek exit from the Euro, wouldn't simply fall on Greece and the  folks to whom the government owes money. It would fall on markets,  companies and institutions, near and far, that are connected to Greece,  in some cases tangentially. A Greek default would almost certainly cause  Cyprus to seek a huge bailout, for example. Implode a warehouse sitting  in an open field and you can be reasonably sure there will be little  collateral damage. Knock over a skyscraper in the middle of a densely  populated area, filled with buildings, infrastructure and utilities, and  you have no idea what will happen. Greece, as small as it is, and as  isolated as it has become, stands in the middle of a densely populated  area.


    In  early May, voters didn't give either of Greece's two most established  parties a majority, crippling the country's ability to form a  government. This weekend's vote may end the stalemate. Greeks want it to  happen sooner than later, as the debt crisis threatens the stability of  the European Union's single currency.

    Polls have suggested a  narrow victory for a radical leftist party that wants to tear up an  international loan agreement which forced the government to make deep  budget cuts. Alexis Tsipras, the leader of the Syriza party, has equated  austerity with hell.

    The bottom line: What happens in Greece  will not stay in Greece. American leaders should pay attention for their  own sake, say analysts.

    "If Greece exits the euro, it won't be alone. Others will exit," said Paul Donovan, a global economist with UBS bank.

    "There  would be bank runs across multiple countries," he predicted recently.  "Citigroup, for example, may not be exposed to Greece, but it may be  exposed to Portugal, Spain, France. ... It may be exposed to a company  that's exposed to France or exposed to exports to EU."


    Greek Health Prognosis - On Life Support:

    Greece's  rundown state hospitals are cutting off vital drugs, limiting  non-urgent operations and rationing even basic medical materials for  exhausted doctors as a combination of economic crisis and political  stalemate strangle health funding.

    With Greece now in its fifth  year of deep recession, trapped under Europe's biggest public debt  burden and dependent on international help to keep paying its bills, the  effects are starting to bite deeply into vital services.

    "It's a  matter of life and death for us," said Persefoni Mitta, head of the  Cancer Patients' Association, recounting the dozens of calls she gets a  day from Greeks needing pricey, hard-to-find cancer drugs. "Why are they  depriving us of life?"


    French Soup:

    Much  attention was paid to Socialist Party candidate Francois Hollande's  presidential victory in May. That's why this weekend's legislative  election is crucial. In order for Hollande to meet his goals, he needs  similarly aligned lawmakers to win seats.

    What happens during the  legislative election will be a "good bellwether of exactly how divided  the country is," (CNN's Jim) Bitterman said. "Hollande says he's going  to try to bring people together and that Sarkozy was a divisive force."

    There's  going to be great focus on the controversial National Front party,  which could affect how votes are divided, and because the party has a  history of anti-Semitism and racism in France.


    Former British Prime Minister Gordon Brown Warns:

    Gordon Brown has warned that France and Italy may need to be bailed out like Spain because of the unfolding eurozone crisis.

    The former UK prime minister said it was not only Greece, Portugal and Ireland facing the threat of euro exit.

    But,  he added, some of the EU's largest countries such as France, Spain and  Italy were also at risk.Mr Brown also warned that Germany might have to  seek additional funding to safeguard its banks.

    In a stark  warning ahead of next week's G20 summit in Los Cabos, Mexico, Mr Brown  said: "The euro area is finally approaching its own day of reckoning."


    Along the Nile:

    On  Saturday and Sunday, Egyptians are expected to choose between two  leading presidential candidates: Muslim Brotherhood member Mohamed Morsi  and Ahmed Shafiq, a former air force general and civil aviation  official who served under Hosni Mubarak as prime minister. Some have  argued that the choice is really between two tyrannical men who are  unlikely to bring about the kind of change protesters demanded in 2011  during the historic uprising in Cairo's Tahrir Square.

    The  contest itself has become just one part of an increasingly chaotic  political landscape. On Thursday, Egypt's highest court declared the  parliament invalid, and the country's interim military rulers promptly  claimed full legislative authority. Those rulers, the Supreme Council of  the Armed Forces, have been in control of the country since Mubarak's  ouster. They said they'd announce a 100-person assembly that will write  the country's new constitution by Friday.


    From  the Cornfield, while most of the world will be watching Greece, we  cannot ignore the parliamentary elections in France, nor the plebescite  in Egypt.  To ignore any of these 3 elections could catch the US of A  off guard and not see from where the next economic tsunami is coming.

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