ECB Rejects Restructuring as Greece Struggles to Repay Debts
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European Central Bank officials warned of catastrophic consequences if Greece is allowed to restructure its sovereign debt.
“Default or debt restructuring is a dramatic economic and social event for the country which experiences it -- I would call it political ‘suicide’ -- which leads many into poverty,” Executive Board member Lorenzo Bini Smaghi said in Florence today. Fellow board member Juergen Stark said restructuring “wouldn’t be a solution to the problems that Greece needs to overcome.”