Global Crisis

global crisis graphic 1
By Sean Bailey

With their no-vote on Sunday, Greece has set into motion a series of events that the world economy has never seen before. The European Union has always been an idealistic and precarious congress of nations, built on ideas of multinational currency and governance. Indeed, many news stories in the media circus surrounding this referendum have referred to “the European idea”, as if countries sharing a common currency was simply a twinkle in the eye of ambitious politicians.

greek flag flying behind motorbikeIn his piece, published earlier this week, Noah Donnenberg made a prediction that, given Greece’s talks with Putin, that Russia would offer a helping hand to Greece after its catastrophic exit from the Eurozone. Greece, a major customer of Russia’s energy sector, would occupy a position similar to that of Crimea, although replacing physical annexation with “economic annexation”. It will become, according to Noah, “a kind of neo-colonial relationship” with Russia holding czar-like control over Greece in the next step of Putin’s expansionist agenda.

Drew Cunningham disputed Noah’s prediction, and threw in some of his own for good measure. However, Drew, in pointing out that Greece would be an economic burden on Russia, failed to take into account Crimea, which is expected to cost Putin’s government trillions of rubles. Putin seemed remarkably unconcerned about his economy, and Greece is arguably much more of a power play than even Crimea would be. Putin appears to be ruling with his ego, at least where annexation is concerned.

Drew presents his own theory in response to Noah’s. He believes that China will use Greece as an economic wedge to expand their trade relations with Europe, and points to China’s purchasing of Greek IOUs as evidence they are the gentleman caller to Greece’s damaged damsel of an economy. This would make sense, as China (unlike Russia) has been interested in increasing their interaction with the Western countries and their economies, and have instituted numerous policies, like the Special Economic Zones, to hasten the influx of foreign money in their coffers. China would certainly have the available cash and stability to assist Greece financially, with much more ambivalence from the global community as opposed to Russia.

The Global Markets

Although there were minor shakeups in the global stock markets, fear of the default spreading to other economies, and the requisite risks, are low. The momentary shifts in stock prices are not expected to have any long-term effects. India, throughout the entire world economy, is in a uniquely good position to weather any economic storm: it has over $355 billion in forex reserves, effectively providing insulation from any economic shocks caused by the Greek crisis.


No matter what happens, this unprecedented vote has shaken confidence in what some consider the largest social, political, but most of all economic experiment: the Eurozone. Its supposed permanence will either be affirmed, or, most likely, torn down by Greece’s unique economic situation. Whether Greece seeks respite from Russia or China, whether the Eurozone is left unblemished, and whatever the final result of this crisis, rest assured it will have long-lasting and far-reaching consequences for what is truly a worldwide economy and a global society.

If you liked this article, don’t despair! Check out the two other posts in this three-part series about Greece, the Eurozone, and the world economy for more content just like this. And be sure to share these articles on social media if you liked them!

After Greece

Greek protests following the vote. Noah Donnenberg’s Cyrillic predictions about Greece’s likely exit from the Eurozone.

China’s World

Drew Cunningham rebuts Donnenberg and makes predictions of his own regarding China’s role in the Grexit.

Global Crisis

Greek protests following the vote. Sean Bailey wraps up the triple feature with an overview of the potentially far- reaching implications of this crisis.

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  • SCHLOMO (Sh-low-mow)

    I would like to thank you for your coverage of this troubling, and still unfolding, situation in post-vote Greece. I appreciate that you had a few perspectives on the situation, rather than just your own.

    That Noah characters is off his rocker if he thinks that Greece would benefit from Russia. Having lived in Israel, which has many Russian inhabitants, for many, many years, I can tell you that they are not help at all. I ask a Russian where the bathroom is, he responds in such heavily Russian-accented Hebrew that I can’t understand a word that he is saying and have to run like a lamb before passover to the nearest public toilet! Then another time I ask a Russian what the weather is like, and she says that it is balmy, so I walk outside and it’s 40 degrees outside. THEY HAVE SUCH A SKEWED SENSE OF WHAT A COMFORTABLE TEMPERATURE IS. I walk into one of their bars on a mild day in Tel-Aviv, and everyone inside has sleeveless shirts on and the thermostat is set to an un—ly temperature. Let me tell you, THEY WILL BE OF NO HELP TO GREECE. See, Israel and Greece share a mediterranean climate–great for vineyards and fig trees–but not for Russians who have no idea that 35 degrees is not “priddy” warm.

    That Drew character would probably have some points of contention with your analysis of his article because I think he would say that he did take into account Crimea in his article, even though it is not readily apparent in his writing, but found it irrelevant given the difference in scale between Crimea and Greece. Whereas Crimea is a small, Russified region struggling not to be torn away by the Black Sea, Greece is an ancient NATION with a EUROPEAN IDENTITY. You even hint at this problem of scale when you point out that the annexation of Crimea will cost trillions of rubles. Well, if Crimea will cost trillions, just imagine how much Greece (which is 5 times larger by land size and population) would cost.

    I know the annexation of Crimea sounds impressive, or something, but really it was not. There was a freaking referendum in the negligible region in which 96.77% of the voters said that they would like to join Russia! It is very easy for a kidnapper to take someone who wants to be kidnapped! If you want to really be impressed, take a look at Israeli history during the middle of the last century! HAHAHAHAHAHAHA!

    You also mention that Putin character. You say he is “ruling with his ego,” which negates the earlier point you make that because he seems unconcerned about the high cost of annexing Crimea, Russia would somehow be able to afford subsidizing Greece. Ego does not = Reality. It is Putin’s job to pretend that Russia has limitless resources to triumph over the world. The reality is, though, that Russia’s economy is in shambles and their resources are limited.

  • SCHLOMO (Sh-low-mow)

    Just in case my last comment seemed a little heavy, hears a picture of The Battle of Armageddon, which is slated to happen in my beloved Israel any day now!

    • Concerned Citizen

      I think Schlomo meant “here’s” not “hears.”