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In the face of such dire economic circumstances plaguing Greece’s economy, and in light of the fact that we live in an increasingly globally connected world where European economies and world economies at large are inextricably linked, one cannot help but wonder how the financial and economic situation in Greece will affect stock trades and investments in the UK, particularly on the London Stock Exchange.
We’ve already witnessed drastic falls in the valuation of the Euro currency against the US dollar due to increasing fears over the foreign exchange Eurozone crisis- a by-product of the Grecian economic brouhaha; not to mention the close to £190 billion general devaluation of shares that occurred not too long ago on the London Stock Exchange as a result of fears over a likely imminent Greek exit from Euro currency use.
Interestingly, adverse effects such as these are being witnessed in the UK in spite of the fact that the country largely operates outside of the Eurozone. Moreover, asides the £190 billion stock valuation dip aforementioned, share valuations in UK stock markets have effectually been exceedingly volatile in recent times.
Several UK politicians and financial experts have consistently urged that decisive and effective steps be taken to either save the Eurozone, or at the very least insulate its effects and implications so as to mitigate the situation’s adverse effects on the London Stock Exchange and the UK economy as a whole. As a matter of fact, several reiterations have been made by British Prime Minister, David Cameron, to this effect.
Taking into consideration subsequent happenings and occurrences such as the bailout package being prepared for Greece, the country’s capacity to meet up with stringent conditions accompanying the bailout, the Greek government’s pleas for softening of such conditions, and strong opposition from many European leaders against any condition alleviation of any kind, it would appear the blows being borne by traders and investors on the London Stock Exchange are far from over. Such effects, all things being equal, are bound to be nothing but adverse. The question is; how adverse will they be, and how well can the British economy hurdle over or overcome them. Many are of the opinion that since the UK economy has many a time proven itself to be quite resilient, and has fared relatively better than its European counterparts in dealing with the harsh effects and implications of the far-reaching European debt crisis, these hurdles will easily be overcome with appropriate fiscal, economic, and financial policies. However, others strongly oppose this notion in light of “double-dip” recessionary tendencies being witnessed in the economy.
