Greece Needs to Restructure its Debt: El-Erian

Greece is not even close to stabilizing its financial situation and should restructure its sovereign debt, Mohamed El-Erian, chief executive of Pacific Investment Management Company [PIMCO] wrote in an article for German daily “Handelsblatt” on Wednesday.

[From Reuters]: “So far none of the solutions for the Greek debt crisis have worked. And a lot of people – including me – don’t believe that they will work in the future,” the head of the world’s largest bond fund, wrote.

Greece will need “a preferably voluntary and orderly restructuring” to relieve itself of its debt burden, the PIMCO CEO said.

El-Erian asserted Greece’s rescue by the European Union, the European Central Bank and also the International Monetary Fund hadn’t produced the outcomes that have been expected and called for urgent and new measures.

“This means abandoning rescue attempts if they do not and will not work,” El-Erian said.

Greece is in a tremendous financial crisis which has had consequences throughout the European Union economy. The crisis is based mainly due to Greece’s entitlement tradition where the federal government has overspent to the point where the nation is looking at bankruptcy.