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EU Treatment of Greece Shows 'Moral Decay': Economist
CNBC.com | March 20, 2012 | 01:24 AM EDT

European Union leaders showed “moral decay” in delaying Greece’s bond swap deal in order to minimize the impact on the region’s banks, according to High Frequency Economics’ founder and chief economist, Carl Weinberg.

In a March report on the global economy, Weinberg said EU leaders had deliberately delayed Greece’s restructuring, to the detriment of its economy, in order to give banks time to prepare for the hit on their debt holdings.

“Why wasn’t Greece allowed to restructure its debt two years ago, before its economy contracted by 15 percent, and before it was necessary to impose a haircut on private sector borrowers, destabilize the government and the economy, illegally implement retroactive collective action clauses, and trigger credit default swaps ?” he asked in the report.

“It was inconvenient for the banks, that is why,” he said.

Weinberg added that EU leaders forced Greece to go through severe austerity measures in order to give banks time to deal with the debt.

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