By Stephen Langton, Forth Capital
For thousands of years there have been Greek Tragedies. From Oedipus to modern times, the idea of a Greek Tragedy is a familiar one. In most recent years, the Greek Tragedy being played out in front of our eyes in real time, has been the demise of the Greek economy and the suffering of the Greek people.
An inefficient and inflexible labour market, a reliance on the black economy and a divergence in growth from its Northern EU brethren, coupled with the debt from the global financial crisis, made the current situation inevitable.
Austerity hasn’t worked for Greece and the “Emperor’s New Clothes” reality is that Greece cannot pay back the debt whether it wants to or not.
This is not the first time in their history that the Greek people have suffered and I suspect it will not be the last.
A little perspective
Whether or not Greece survives the current crisis and stays in the Euro and the EU is still to be seen. What is inevitable is that there will be short to medium term declines in markets as there always are in times of uncertainty.
Will the crisis spread to other countries? At this stage no one knows for sure. If it does, there will be more uncertainty and more declines in markets.
What we do know for sure is that crises come and go. They are the one constant throughout our economic history.
Those who do best in investment as opposed to trading, generally are the people who understand the nature of markets and who do not let short-term events dictate their long-term strategy.
Global events should give us perspective about what we want from our investments.
Why do we invest at all?
This will of course depend on what stage of life we are at, but, talking to many of our clients, the answers are often similar:
Security, wealth preservation, generation of income and the ability to pass as much hard earned wealth as possible to the next generation.
Being invested means participating in the growth of companies and businesses that are providing the goods and services on which we all rely. It is not a short-term single event but a long-term process with ups and downs along the way.
Whatever tragedies unfold in Greece and elsewhere over the coming weeks, it will pay to remember this.
Author's bio
Stephen Langton has been working in financial services since 1988 working for both small investment companies as well as major institutions such as Royal Bank of Scotland and SEB. Having lived for seven years in South East Asia and seven years in France, Stephen has a good appreciation of the financial issues faced by expatriates.
For much of the last ten years Stephen has provided advice to retired expatriates living in France. A new member of the Forth Capital team, Stephen is delighted to be back living close to the mountains, where he will have ample opportunity to ski!
