Greece Passes New Austerity Measures as Riots Engulf Athens

The latest austerity package was forced through the Greek Parliament on Sunday under the watchful eye of EU and IMF lenders, all but ensuring that Greece will receive a new round of bailout funding that will be used to pay the interest on its pared down current debts. The political theater that has been playing out around the "will they or won't they" Greek Default Dance has been entertaining and disturbing at the same time. Despite all the rhetoric and the growing benefits to Greece and Germany if Greece simply defaulted, there was never any real possibility that was going to happen.

Instead, new austerity measures were passed into law, which will eventually prove to be wholly unenforceable and pointless. But that realization is probably months or possibly years away for EU leaders who care mostly about appeasing central banks and major lenders who are trying to shift their Greek losses onto the shoulders of taxpayers in Europe and the US. The process is now fully underway, and it will be most interesting to see just how far it goes and what consequences it creates.

The short-term impact of the new Greek deal is that markets will rise and there will be some talk of "containing" the Greek debt problem before it spreads to other bankrupt nations like Italy, Spain and Portugal. Whether such things are possible remains to be seen. For now, however, the proverbial can has been nudged just a bit farther down the road, but it will once again be at our feet in the very near future. So despite what we'll hear from the mainstream media and the financial talking heads, the new Greek deal is likely delaying an inevitable default of some greater magnitude that will occur at an undetermined point in the not too distant future.