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Woman holds a Greek Euro coin - Source: Reuters -
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Hardly a day has gone by in the last two weeks when I haven't had to mention the Greek debt crisis in one of my business news updates.
In fact, I've gotten rather sick of talking about an issue that seems on the face of it so far removed from New Zealand.
"He's not ranting on about Greece again is he?" I can imagine people muttering as they pile in another spoon of cornflakes....
Well unfortunately, as we learned with the US sub prime housing crisis, this is an extremely interconnected world. So, when a small union strikes in Athens over tough Greek government spending cuts, it does actually have an impact on our markets!
This is because any sign that the Greek government may be losing its battle to reign in spending and cut its budget deficit tends increase the fear of actually defaulting.
According to Reuters, Greece need to raise about 53 billion euros this year to finance its budget and roll over outstanding debts, which are expected to grow to 290 billion euros this year, nearly 12% of GDP.
A default in Greece (which surely won't be allowed to happen) would be a disaster for Europe and be a major set back for the world's recovery.
This is because many fear that it would be contagious and spread to other Euro one countries that are also struggling with high debt levels.
These are Portugal, Ireland, Italy and Spain - who along with Greece make up the group of countries uncharitably labelled by traders as the P-I-I-G-S.
Over the last few weeks the fear of a Greek or Euro zone debt default has lead to some quite big sell-offs on global markets, and certainly plenty of volatility.
The local NZX has not been immune and was down around 2% in January.
The New Zealand dollar too (much to our exporters delight) has fallen swiftly from around 74 cents two weeks ago to as low as 68 cents earlier this week.
This is largely again due to global risk sentiment, with nervous investors choosing to take the safety of the US dollar over riskier bets like the Kiwi.
In some ways the European debt issue is just another resurfacing of the original credit crisis of 2008.
Back then, in order to prevent a financial melt down, governments around the world took on the bad debts of failed banking systems.
Unfortunately for the likes of Greece, which were already facing high debt levels and sluggish economy, it has all been too much to handle.
Making matters worse is that investors are now running from Greek bonds, pushing the interest rates for holding Greek debt up to record highs.
Others claim speculators are also now targeting Greece and making matters worse.
Inevitability the EU had to step in to try to stop the rot, and did so on Friday by confirming it would stand by Greece.
It had no choice really.
However, it remains to be seen just how they will do that.
Greece at this stage is refusing to take help, saying it can sort out its budget problems on its own and get its economy back on track.
To do so though it will need to make some big and harsh cuts to spending, something that will take strong political leadership given the pain it may inflict on the average Greek citizen.
Details of a possible bailout will be unveiled by the EU next week and markets will be pouring over these.
Fingers crossed it will be enough to restore some confidence and get Greece out of the headlines, and as a result, out of my market updates.
Here's hoping...