Newspaper article Evening Gazette (Middlesbrough, England)

Greece: Should We Be Worried? the Greek Financial Crisis Is Hitting Us All, Explains Stockbroker ANTHONY PLATTS

Newspaper article Evening Gazette (Middlesbrough, England)

Greece: Should We Be Worried? the Greek Financial Crisis Is Hitting Us All, Explains Stockbroker ANTHONY PLATTS

Article excerpt

Byline: ANTHONY PLATTS

WHEN it comes to Greece, most Britons only have one question to ask themselves - can they cope with its sizzling August heat? Yet the heat is on Greece already and whether you are planning a holiday or not, its economic troubles are affecting you.

The uncertainty across Europe has rocked stock markets and put investors in a nervous mood. Fund sales are at their lowest levels since the 2008 financial crisis.

Many savers are avoiding equity funds in favour of lower risk corporate bonds and cautiously managed funds that invest in a spread of assets.

So what on earth is going on in Europe and how is its debt crisis affecting your finances? Q: What has caused the debt crisis? A: To put it succinctly, over-borrowing.

Several countries, including Greece, have borrowed beyond their means and the ramifications of the financial crisis have left them struggling to repay their debts.

This is why Euro leaders, such as French President Sarkozy and German Chancellor Merkel, have been meeting over the past few weeks. They have been trying to come up with a rescue package to help the Greek government.

Q: Will it affect the UK? A: Undoubtedly. Britain exports to the Continent, so if Europe's economy collapses we will feel the impact. Many companies could struggle to increase sales, our economic recovery could falter and, ultimately, more jobs could come under pressure. British banks could also feel the heat because they will have exposure to Euro zone debt.

Q: When will the euro debt crisis be over? A: No one knows. The debt crisis has been lingering for more than a year and there is no end in sight. As well as the financial troubles affecting Greece, there are also concerns that Italy, Spain, Ireland and even France could be at risk of defaulting on debt repayments. This one is likely to run and run for a while yet.

Q: What about my savings and investments? A: Only Rip van Winkle would not have noticed that stock markets have been volatile for a while. They are likely to remain volatile while there is so much uncertainty in the world. Share prices are influenced by confidence as much as strong balance sheets - and all the uncertainty is denting confidence. …

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