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Explain how the financial difficulties faced by the Irish and Greek governments have impacted on Euro debt markets - Essay Example
Finance & Accounting
Pages 3 (753 words)
Question: Explain how the financial difficulties faced by the Irish and Greek governments have impacted on Euro debt markets. The European economy includes 48 states and more than 731 million people. The wealth and economic growth of Europe’s different states vary one another and this difference can be clearly seen in a rough East-West divide…
This paper will analyze how the financial difficulties faced by the Irish and Greek governments have impacted on Euro debt markets. In the opinion of Stange (2010), the financial crisis of 2008 was the root cause of the 2008-2011 Irish financial crisis which led the country to recession for the first time since 1980s. In September 2008, the Irish government officially declared that the country was in recession and the nation experienced a steep fall in employment in the following months. In January 2009, 326,000 Irish people claimed unemployment benefits; this figure was the highest since records began in 1967 (Labour and the totemic gesture, 2011). The Irish financial crisis became worse subsequent to a series of banking scandals in the country. This situation caused the ruling Fianna Fail party to lose its public support significantly. The nation’s Irish Stock Exchange (ISE) general index dropped from 10,000 points in April 2007 to 1,987 points in February 2009; and this decline indicated a 14 year low general index value (RTE News, 24 Feb 2009). The last time the index stood below the 2,000 level was the mid 1995. The credit expansion as a result of rapid growth of Irish economy during the Celtic Tiger years was the major reason that led to 2008-2011 Irish financial crisis. ...
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