Eurozone: A terrible situation just got worse

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(Reuters) - Greece and Ireland had much larger budget deficits last year than expected and the Greek data may be revised further due to its unreliability, the European Union's statistics office said, sending the euro lower.

"It looks like a terrible situation just got worse," said Nick Kounis, economist at Fortis.

Greece ... had a gap of 13.6 percent of gross domestic product, rather than 12.7 percent as reported earlier, Eurostat said.

But the deficit may turn out to be even higher.

"Eurostat is expressing a reservation on the quality of the data reported by Greece, due to uncertainties on the surplus of social security funds for 2009, on the classification of some public entities and on the recording of off-market swaps," Eurostat said in a note attached to the data.

...

"What concerns me is the general uncertainty about the Greek official figures. This affects market perception about Greece ... that one can't rely on the Greek statistics and that the deficit is revised up and up and up," said Giada Giani, economist at Citigroup.

...

Ireland had its budget deficit revised even more -- to 14.3 percent from the initially reported 11.7 percent.

...

The overall budget deficit in the 16 countries using the euro rose to 6.3 percent in 2009 from 2 percent in 2008 and debt surged to 78.7 percent of GDP from 69.4 percent.

In the whole 27-nation European Union, the aggregated budget deficit was 6.8 percent against 2.3 percent in 2008 and debt rose to 73.6 percent from 61.6 percent.

http://www.reuters.com/article/idUSTRE63L1G420100422

[mawilson 2,133]

I see Obama's policies are working well in Europe.

[Ali G. 37]

Greece's largest problem is that up until a few years ago, they had basically collected no income tax. Actually, come to think of it, you want to talk about the consequences of a society with zero government libertarianism in action, there you go. Pretty much anything goes in Greece.