Bloomberg: The European Debt Crisis (Video)

eurozone

The news agency Bloomberg with a short animated film, explains the reasons that led to the economic crisis outburst in Eurozone with disastrous consequences for Greece, Ireland, Portugal and Spain.

The news agency thoroughly describes how the crisis started. In particular, the video explains that countries such as Greece before the euro had to pay high interest rates (around 18 percent) to borrow, but once they entered the Eurozone they could borrow for the same low rate as Germany. “Countries such as Greece, Spain and Portugal were borrowing money by using Germany’s credit card” mentions Bloomberg’s video. The news agency also makes special reference to the policies that were followed in Greece and other European countries and criticizes the politicians’ mentality. They were borrowing money that they knew that their states will not be able to repay, just to fulfill their promises of higher salaries, pensions etc., simply because they wanted to be re-elected. This is how huge debts accumulated and as a result, the countries of Europe became tightly intertwined because they started lending money to one another and all the Eurozone countries were happy. However, this chain was stopped due to the housing bubble crisis  in the U.S. and when strict financial policies succeeded the lending policy.

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