Speculation not the root of Greece's problem

The idea that speculation with credit default swaps (CDSs) is responsible for Greece's financial crisis and the consequent pressure on the euro is nothing but a fantasy made up by politicians seeking scapegoats for the crisis, writes the daily Neue Zürcher Zeitung: "From this perspective the image of greedy financiers who intentionally bring about a national bankruptcy is absurd. Certainly, speculation can inflate CDS prices in the short term, which certainly doesn't help Greece. Nevertheless risk premiums for Greek bonds are primarily determined by their probability of failure. Speculation exacerbates the problem, but it is not the root of the problem."

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