MUMBAI (Commodity Online): Greek literature boasts three great writers of tragedy: Aeschylus, Sophocles, and Euripides in the olden days.
But, now Greek tragedy has nothing to do with literature. It is all about money or rather Euro. In the ancient days, the largest festival for Greek tragedy was the Dionysia held for five days in March or April, for which prominent tragedians usually submitted three tragedies and one satyr play each.
In 2010, Greek Tragedy is again performed in March-April with three major players like Germany, France and Greece.
Earlier days, the tragedies were performed in the form of a contest among three playwrights, who presented their works on three successive days. Each playwright would prepare a trilogy of tragedies, plus an unrelated concluding comic piece called a satyr play. Often, the three plays featured linked stories, but later writers like Euripides may have presented three unrelated plays. Only one complete trilogy has survived, the Oresteia of Aeschylus
Now, the plot has changed. There is only one tragedy which can affect people and countries now. That is financial downfall. After the sub-prime crisis in the US and the Dubai World crash, now Greece is on the verge of bankruptcy. The modern day tragedy is written by Greek's own inefficient government.
But, at that time gold was an important factor in Greek tragedies. Now also, gold has an important role in this tragedy. Because, gold gains from the present economic crisis in Greek. Riding on the Greek debt crisis, gold posted impressive gains in the past few weeks. This is because of the uncertainty over the Euro.
Despite being a relatively rich country with a per-capita income in the region of $28,000, the current state of the Greek economy has left many observers wondering how the finances of the country could have deteriorated to such an extent that they have been left stranded without the required bailout for the last several weeks now.
The Greek government has had a history of inept governance of its public finances with burgeoning expenses on their public sector work force - without enough accountability on productivity - being financed by ever-increasing government borrowings.
Greece has one of the lowest tax rates in Europe with relatively high levels of tax evasion and most economic commentators believe that the official figures are not very reliable.
The fiscal situation in Greece is quite simply a torrid mess. In 2009, the fiscal deficit stood at a clearly unsustainable 12.7% of GDP, recently revised upwards to 12.9% - more than four times the 3% limit set for the member countries of the European Union (EU) and the highest level in the history of the EU. The government debt stood at 113% of GDP, out of which almost 100% is external indebtedness.
For a country with a nominal GDP of around $320 billion, some $43 billion of external debts are due this year and they have to be refinanced with the market increasingly turning sceptical about Greece's ability to do so. The Greek sovereign bond yield is trading at around 7.3%, a 4.2% gap over the comparable German bond, both being euro denominated. Under pressure from other member countries of the eurozone, the government has proposed a wage freeze for its employees with a modest cut in other benefits.
Further the country was hit with another financial headache last week after Fitch Ratings slashed its credit rating on the country's debt because of mounting concerns about the government's ability to get a handle on its debt mountain.
Fitch, one of the world's big three ratings agency, lowered its rating by two notches BBB- and said that the outlook on the country remains negative.
The downgrade means that Greek debt remains investment grade - but only just. Another downgrade would make Greece's debt junk status - an ignominious position for a country using the euro currency.
Fitch said the downgrade reflected ongoing uncertainties about the government's financing strategy in the context of increased capital market volatility.
The ratings agency thinks it's now increasingly difficult for the Greek government - despite its commitment to reduce borrowings - to achieve its target of reducing its budget deficit to 8.7 percent of the country's national income and ensuring that public debt peaks at just over 120 percent of gross domestic product in 2010 and 2011.
The last nail in the coffin came from Jim Rogers when he said he would like to see Greece go bankrupt! Such a bankruptcy, he believes would be good for the Euro. The best thing that could happen will be for Greece to go bankrupt. It will be good for Greece, it will be good for euro and it will be good for Europe because people would understand that Europe is going to have sound currency. They are not going to lead people spend money. They don't have and if they did that, and we all realise this is going to be a sound currency, I and probably many others could buy lots of euros.
I find it pretty absurd what is happening in Europe. I find it absurd that people who have been doing the right thing - Germany and some other countries - are suddenly going to have to pay up people who have been doing the wrong things - spending huge amounts of money they didn't have and lying about it as well. I find that absurd, he added.