Greece: Bailout Just Buys More Time

by Steven Russolillo

Wall Street Journal
February 21, 2012

Analysts and economists aren’t exactly jumping for joy over the latest Greek bailout.

Euro-zone finance leaders agreed to a $172.1 billion rescue deal for Greece. The country’s private creditors will take an even bigger loss than originally agreed upon, amounting to about a 53.5% haircut as opposed to the 50% agreed upon in October. The deal should help reduce Greece’s debt as a proportion of GDP to 120.5% by 2020 from about 164% currently.

But doubts linger over whether Greece will be able to implement the appropriate austerity measures and additional terms that are needed to justify the bailout.

The Dow Jones Industrial Average was recently up 20 points, or 0.2%, at 12970, while the S&P 500 tacked on 3 points, or 02%, to 1364.

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