The new left-wing leaders in Greece have done little to stem the country’s growing financial crisis and even members of the Obama administration are now urging them to act.

NBC News reports:

Greece Debt Crisis: U.S. Warns Athens to Reach Deal or Face ‘Decline’

ATHENS, Greece — The United States turned up the heat on the Greek government over its debt crisis Saturday, urging it to reach a deal with creditors as wearied citizens braced for a national default.

Treasury Secretary Jack Lew said in an interview that the government in Athens should make tough fiscal decisions or risk devastating both the country’s economy and people.

“I think we’re at a moment now where the burden is on Greece to come back with a response that’s the basis for reaching an agreement as quickly as possible,” he said in an episode of CNN’s “Fareed Zakaria GPS” program that will air on Sunday, according to a transcript provided to Reuters.

“It’s clear that within Greece, the consequence of a failure here would mean a terrible, terrible decline in their economic performance,” he said. “It will hurt the Greek people. They will bear the first brunt of a failure here.”

Billions of dollars a day are being withdrawn from banks, raising the prospect that the country might have to limit ATM transactions among other capital controls.

As the situation has worsened, some are calling for the let it burn strategy.

Barry Ritholtz of Bloomberg:

Let Greece Go

The never ending sturm und drang over the state of Greek debt, membership in the euro zone and the potential shocks of a debt default have moved from tragedy to comedy to monotony.

The solution is simple. It won’t be fast, it won’t be easy, but it will be a huge improvement for all concerned.

Let Greece go.

Hey Greece — if anyone is listening — just default on the debt and start anew. The rest of Europe has caused the country and everyone else enough agita: just let Greece leave the euro zone in peace. Sure, it will be a long torturous process, but at least Greece — and maybe the euro region — will start moving in the right direction.

The Guardian reports that the Greek prime minister is scrambling to avoid default:

The race to save Greece from economic collapse has intensified as the country’s beleaguered leader conducted a flurry of behind-the-scenes negotiations before an EU summit on Monday that is expected to decide the country’s fate.

Alexis Tsipras, the prime minister, met senior officials on Saturday in an attempt to devise a package of reforms that would secure emergency funds and avoid the nation defaulting on its massive debts. It will be the third such proposal that Athens has made to its creditors in as many weeks.

“We will try to supplement our proposal so that we get closer to a solution,” Greece’s minister of state, Alekos Flabouraris, told broadcaster Mega TV. “We are not going [to the summit] with the old proposal. Some work is being done to see where we can converge, so that we achieve a mutually beneficial solution.”

According to Zero Hedge, it may already be too late:

“Bank Holiday” Preparations Begin In Greece, Lines Form At Athens ATMs

The writing has been on the wall for quite sometime.

Deposit flight from Greece’s ailing banking sector has been running north of €500 million per day this week as the threat of capital controls casts a pall over the Greek government’s efforts to reassure the public and head off a terminal bank run.

Featured image via YouTube.


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