Policy makers mustn’t underestimate the consequences of a possible Greek euro exit, which could spark a run on lenders and overwhelm the European Central Bank, said Joachim Fels, Morgan Stanley’s head of global economics.
Portugal will need a bailout and investors will then focus on Spain as there’s “little to stop the contagion” from Europe’s sovereign-debt crisis, said Joachim Fels , co-chief global economist at Morgan Stanley.
Morgan Stanley co-chief global economist Joachim Fels said there’s a risk of some nations eventually breaking away from the 16-member euro region should the response to the debt crisis lead to “fiscal instability” and sustained pressure on the currency.
Alexandra Paschia’s toddler runs among the shoes marked down to 5 euros ($6.63) from 50 euros in their family-run store in Athens. The demise of Greece’s economy has spanned the life of the 2 1/2-year-old girl, and ensures there are no customers to bump into a week before elections.