CDN$ sees Greek ripples: Economist

Canadians are no longer watching Greece run out of money from afar.

Global and North American markets were down Monday. The Canadian dollar took a dip one day after a failed austerity referendum in the Mediterranean country.

The government in Athens must figure out what to do next as many hoped the ‘no’ vote would speed along bailout negations.

The problem is, because of that vote, Greece is now facing a likely exit from the Eurozone.

Benjamin Tal, chief economist with CIBC, told 660News over the next few weeks “volatility will be the name of the game.”

“I think you will have a situation in which you will see stock markets rising and falling and the dollar probably going down, the bond markets actually improving.”

Still, Tal said he doesn’t expect Canadians will notice a change in their wallets in the long term.

“The very existence of the Euro is at stake here. To the extent that Germany is able to convince everybody that Greece is a very specific case and you don’t really risk the Eurozone at all, the impact on Canada will not be very significant.”

According to Tal, the uncertainty, seemingly here from Greece, is actually reaction to the larger, similar Spanish economy and how Germany will let it play out in the Eurozone’s future.

“If Greece leaves the union, the union can survive. The union cannot survive without Spain because it’s simply way too big. Because after Spain, Italy will come and that’s the end of the union.”

Should German Chancellor Angela Merkel indeed cut Greece from the Eurozone, it would be seen as foreboding for Spain and eventually Italy.

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