Bardonomics

Image: Bloomberg There is a famous Greek myth about two sea monsters, Scylla and Charybdis. It is said that they lived on opposite ends of the Strait of Messina, terrorising ships that attempted to pass. If any vessel attempted to avoid one of the monsters, it was certain to be destroyed by the other.  Today, that legend is encapsulated in the saying "between a rock and a hard place."  Athens now finds itself in a somewhat analogous predicament. By the end of this month, Greece must repay the International Monetary Fund (IMF) $1.7 billion in loans. Additionally, in July and August the country is due to pay the European Central Bank (ECB) nearly 6.8 billion euros ($7.6 billion). Greece does not have the funds to honour those obligations. Crucially, the European Commission is refusing to release 7.2 billion euros in bailout funds unless the Greeks agree to additional fiscal austerity measures. If Greece is unable to repay its debts, it faces expulsion from the