March 16th, 2012
06:25 PM GMT
London (CNN) – The bail-out is a done deal, the International Monetary Fund has agreed its share and the Europeans have started to hand over the money. One of the ratings agencies has even upgraded the new Greek bonds.
So it is incredibly dispiriting to be reading more and more notes from economists and analysts suggesting that this is not over yet.
Paul Donovan, in his note from UBS, noted that the markets were not that impressed by the state of play. The markets, he said, were pricing in “the debate about when the next restructuring will take place.”
According to Societe Generale, it is "only a matter of time before Greece will need an additional package." Citigroup reflects the same view, noting: “In our view, Greece requires further official funding beyond at least 2014, and we also see the need of further debt restructuring in order to get the country back on a sustainable fiscal path.”
It gets worse with the prognosis "the risk of Greece exiting the euro area remains elevated (around 50%)."
Hang on. "Next restructuring?" and "further debt restructuring?" What on earth have we been going through for the past three months if this isn’t going to solve the Greece problem once and for all?
You would be forgiven for a certain incredulity, given that no sooner is the ink dry on the checks being sent to Athens than the economists who know about these things say it’s not enough.
This is made all the more likely by European politicians who continue to call for even more austerity in Greece. This lemon is just about squeezed out, and if they don’t want to be facing riot and mayhem they would do well to recognize this.
This comes as Iceland announced it is paying back 20% of its IMF loans early. Yes….I said early. Iceland. Which also introduced austerity and borrowed money but - notably - let the banks go bust.
No one ever said going bankrupt was easy, but it still may have been the best solution for Greece rather than this messy, half-baked solution we are now witnessing.