Foster Group

Is Greece the world’s “Canary in the coal mine?”

There was a time when caged canaries were used in coal mining as sacrificial warning signs of the presence of toxic gases.  When the canaries stopped singing, the miners knew it was time to get out.

While Greece has been receiving much of the attention, the size of Greece and magnitude of their potential default doesn’t seem to be in line with the markets’ response of late.  In his blog, linked below, Scott Grannis discusses this issue and suggests the magnitude of recent market reactions to the back-and-forth of a potential Greek default may be a realization that many other governments around the world are traveling down the same road.

Regardless of your political leaning, there is a significant silver lining to this issue.  It’s the broad realization that we have a problem and something needs to change.  There have been issues in the past which America has solved and dark periods from which we’ve emerged, and I am a firm believer it can happen again.  Admittedly, the road to fiscal recovery may be long and winding, but as the saying goes, “The first step is admitting you have a problem.” 

http://scottgrannis.blogspot.com/2011/11/why-is-greek-tail-wagging-global-dog.html