Editor’s note: This article was first published in October 2011, at the height of the Greek debt crisis. Fears of contagion to Spain and Italy are described as current at that time.
Europe is bracing for the harshest period of austerity in its history. While the eye of the storm seems to be the Greek crisis, many are already preparing in case it spreads to Spain and Italy, and make no mistake: the message Alessio Rastani put out (whether he’s a broker, a trader or a babysitter) was spot on. While millions of citizens and companies struggle to survive, a minority is working very hard to come out ahead from other people’s misery.
Greece urgently needs cash. Local companies and businesses are drowning financially and see no way out. Greek banks are cornered, and now they have to dance to capital’s tune. Dozens of international companies have already seen their big opportunity in Greece. To give a few examples, the multinational Nike has found a building at half price where a Greek bank used to be.
Meanwhile, H&M and Mango are negotiating to acquire centrally located premises whose owners are in debt and urgently need cash.
Company speculators have already set up shop in Greece. Their job will be to spot companies with severe debt problems and offer them to their clients, who are usually large corporations, mostly American and some European. Cash-rich international companies will find gold where the Greeks, right now, see only straw.
Banks and the government are a business too
It isn’t only companies that will see business opportunities in a battered Greek market: the Greek government and banking system themselves will also become an excellent business.
The government will have to raise liquidity by selling its own assets, and those assets are on sale right now, so it won’t be hard for a cash-rich investment firm to find a once-in-a-lifetime opportunity, not to mention privatizations at “cost” price.
The big hedge funds will sweep up public and bank debt, not forgetting the “vulture funds” already circling the area.
The other night, in an interview broadcast on CNBC, the presenter spoke with a manager of one of these funds for an American firm and asked him whether they didn’t feel guilty about getting rich from other people’s misery.
The interviewee’s diplomatic answer was, more or less:
“Nobody likes making money from misery, but if Greece needs someone to buy its debt and we can help while profiting from it, clearly someone has to do it. Why not us?”
It’s clear that where society sees ruin, misery and the danger of contagion, a select club finds business opportunities and isn’t too worried about the risk of contagion. We’re not saying they’re hoping the Greek crisis spreads to the rest of the world, but if it did, make no mistake: they’d be very well prepared to get rich from the CHAOS.
Featured image: Nikolai Karaneschev, CC BY 3.0, via Wikimedia Commons.
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