SUSIE GHARIB: The International Monetary Fund has approved a $36 billion
loan for Greece, but with a warning, the money will be doled out over four
years, and future payments will depend on whether Greece lives up to the
reforms it has agreed to make. A crucial test will come next month when Greeks vote to select a new government. Right now, polls show the two major parties that agreed to the bailout are extremely unpopular.
JACOB KIRKEGAARD, RESEARCH FELLOW, PETERSON INSTITUTE FOR
INTERNATIONAL ECONOMICS: So, you could have a government in Greece that
were dependent on various types of, you know, extremist — whatever you
want to call them, populist parties. And such a government, I think, would
have extreme difficulties in implementing what remains a very tough
economic reform program.
GHARIB: Concerns about Greece`s ability to implement those reforms
were a big factor in approving today`s loan package. And tonight`s
commentator echoes those concerns. Here`s Simon Constable. He`s columnist
at The Wall Street Journal.
SIMON CONSTABLE, COLUNMIST, THE WALL STREET JOURNAL: Today, Greece
got a big nod for its latest bailout. The International Monetary Fund
approved its part of a 130 billion euro loan, the bulk of which is coming
from the European Union. So is Greece out of the woods? And can we rest easy that the crisis
won`t return to give the markets the jitters again? Well, in a word, no.
Even the IMF says so. There is no wiggle room on the Greek economic plan,
IMF staff warn. What that means in English is that Greece is still broke and its
government is going to have to really knuckle down and implement its
spending cuts. Add to that social problems we keep seeing across the
Adriatic country, and it`s not difficult to envision the crisis returning
in short order, and with it, a possible scary ride for the U.S. stock
That`s what most observers are saying. But I`d go further and say
there is still a big chance Greece leaves the euro, the single European
currency. And believe me, when that happens, investors will have few
places to hide. I`m Simon Constable for The Wall Street Journal.