EverBank Direct President Frank Trotter told 111 members and guests at the Global Business Luncheon on Tuesday that the current conclusions about Europe are:
• There could be a move to break up the euro, which is the common currency of 17 of the 27 members of the European Union.
• There will be bailout stress for the eurozone countries, which are suffering their own debt crisis or the effects of others in the union.
• There will be multiple levels of social stress during the workout of the crisis.
Trotter, who is president of the retail banking channel of Jacksonville-based EverBank, spoke several days before Greece passed a key debt test. BBC News reported Friday that Greece was inching closer to its second bailout after it won a crucial debt swap.
The Greek deal with its lenders is the largest restructuring of government debt in history, said the BBC.
The Reuters news service reported Friday that under the biggest sovereign debt restructuring in history, Greece’s private creditors will swap their old bonds for new ones with a much lower face value, lower interest rates and longer maturities, meaning they will lose about 74 percent on the value of their investments.
It also reported that data published on Friday underlined the depth of Greece’s problems, showing that the economy shrank 7.5 percent last year in the fourth successive year of recession.
Reuters reported that Greek’s finance minister hailed the bond swap, which the European Union and the International Monetary Fund had demanded in return for the new bailout, “as marking a long-awaited success for all Greeks enduring a painful recession.”
Trotter’s presentation assessed the global financial condition, saying that broadly speaking, there are “uninspired” global economic growth expectations.
He also summarized the U.S. situation, including:
• Rolling country, state and local economic crises fueled by pension funds.
• At least 1-3 more years of housing adjustments.
• Possible social unrest.
• U.S. dollar and metals volatility, and
• Downward acceleration on the dollar as activity returns.
The Global Business Luncheon, held at The River Club, is co-hosted by the World Affairs Council of Jacksonville and The Gate Governors Club.
For information about the council and its programs, visit www.worldaffairscounciljax.org.