Greece Needs Another 80 Billion Euros…

As unpalatable as it seems to euro zone policymakers, a sizeable reduction in Greece’s debt load is necessary to make the country’s debt sustainable in the long-term, according to a new report from Goldman Sachs.

After investigating Greece’s debt sustainability, researchers at the bank have concluded that to reach the 120 percent debt-to-GDP target set by the International Monetary Fund (IMF) an official sector restructuring of Greece’s debt, worth over 80 billion euros, was necessary.

The authors of the report, economists Themistoklis Fiotakis, Lasse Holboell Nielsen and Antoine Demongeot, note that the IMF’s target is “unlikely” without such a “drastic debt stock reduction.”

Source and full story: Yahoo/CNBC, 13 Nov 2012

Tom Sullivan