Tags: Alan Greenspan | Greek debt | Italy | Silvio Berlusconi

Greenspan: Work Ethic Disparities Fuel European Crisis

Friday, 11 Nov 2011 09:01 AM

Northern Europeans harbor different work and productivity values than do their southern European counterparts, a tough, intangible aspect facing those in charge of ending the European debt crisis, says former Federal Reserve Chairman Alan Greenspan.
 
Fears that debt-ridden Greece may default and disrupt the European financial system are spreading to the larger Italy, wreaking havoc on markets there and outside of Europe.
 
"Markets are basically saying that a number of these countries are competitively out of sync, and they cannot take on" the challenges of the global economy, Greenspan told the Council of Foreign Relations, according to the Wall Street Journal.
 
"In the north they are far more prudent and long-term focused than in the south," the former Fed chief said.
 
At the onset of the euro, the common belief was "the Greeks would behave like the Germans, but they didn’t change their behavior at all," Greenspan added.
 
In Europe, meanwhile, former European Central Bank vice-president Lucas Papademos was appointed to head an interim cabinet in Greece, while in Italy, former European Commissioner Mario Monti has emerged as favorite to replace Italian Prime Minister Silvio Berlusconi, Reuters reports.
 
Market experts say don't expect the crisis to ebb just in wake of the new governments taking over in Italy and Greece, which currently face no reelection and popularity pressures that would prevent them from carrying out tough reforms.
 
Uncertainty and fear will continue to plague investors, at least in Europe.
 
"If investors are assuming that problems in Europe are solved, they’re going to be disappointed," Jack Ablin, chief investment officer at Harris Private Bank, told CNBC.

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Northern Europeans harbor different work and productivity values than do their southern European counterparts, a tough, intangible aspect facing those in charge of ending the European debt crisis, says former Federal Reserve Chairman Alan Greenspan. Fears that debt-ridden...
Alan Greenspan,Greek debt,Italy,Silvio Berlusconi
265
2011-01-11
Friday, 11 Nov 2011 09:01 AM
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