As fears mount that Greece’s economic situation will threaten the stability of world markets, Bloomberg News reports that German officials confirmed that the European Union will be discussing aid for Greece.
Meanwhile, former World Bank economist Joseph E. Stiglitz said on Bloomberg TV that he does not think Greece will default on its debts. Greece’s banks are “reasonably well-capitalized,”according to Stieglitz.
The euro strengthened against the dollar and stocks climbed, as Wall Street Street speculated that the bailout will occur in coming days.
Possible European Union action comes only after equity markets in Europe closed.
While Wall Street hopes for a bailout, at least one Bloomberg analyst remains concerned that the bailout will start a debate about the ripple effects of what is “fair.” The analyst pointed out that both Portugal and Spain could demand money if the European Union provides financial assistance to Greece.
The Associated Press ran an entirely different story. The lede for an AP story that also ran on Forbes.com stated, “BRUSSELS — The European Union’s government-backed lender said Tuesday that it cannot bail out Greece or any other European country that can’t pay its debts.”
The AP also reports that EU and Greek government officials have tried to calm market worries with assurances that Greece can pull itself out of its debt crisis with deep government cuts.
The European Union commission has rejected reports that they are talking about a possible bailout plan and maintain that Greece must help itself.
Which story is true?