The debt crisis in Greece

I haven’t had much time to follow this, but is seems like it’s all about trying to save the banks from the consequences of their mistakes.

Another worry is that Britain’s banks and hedge funds have written multibillion-pound insurance contracts – credit default swaps – that would be triggered if Greece defaults.

Erik Britton, director of City consultancy Fathom, said: “It’s not the direct exposure, it’s the indirect exposure and the implications of an unruly default that I would be worried about. French and German banks bought Greek bonds, and they took out insurance against default. Who did they take out that insurance with? The US and UK
banks. There has to be a loser – who’s the loser?”

If banks had stayed out of the insurance business this would not be a the huge problem it is, maybe de-regulation was not such a good idea after all