May 9, 2011
Worries about Greece’s intractable debt problem deepened on Monday, stoking fears that the country remains on a path to fiscal disaster and that European leaders do not have a convincing plan to prevent a default.
Standard & Poor’s downgraded Greece’s debt once again, and Moody’s Investors Service put its rating on review for downgrade, compounding pressure on the government as it seeks to come up with a solution shy of a debt restructuring, including privatizing state enterprises, though there is resistance to that step.
Analysts and investors said they did not see how Greece could get its debt under control when output is slumping and there is little sign that efforts to restructure the economy are bearing fruit.
“Austerity is fine, but what you really need is investment and growth, and we just don’t see that,” said Jonathan Lemco, a sovereign credit analyst at Vanguard, the mutual fund company.
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