Even wonder what happens when a city goes bankrupt? Does a form of government even control the city anymore? Other questions such as who provides the public services or do the residents still pay tax also come to mind. Since the city of Detroit filed for Chapter 9 bankruptcy protection on the 18th of July 2013 at an estimated $18 billion worth of debt, I guess it is worth talking about it how it could pan out.
Last year on December 26th, Shinzo Abe assumed office as Japan’s current Prime Minister and immediately began fulfilling his electoral campaign promises of bringing sweeping economic reform and output growth to the world’s third largest economy. After suffering decades of lacklustre output and many failed attempts to induce growth, Abe’s policies, both currently implemented and in the pipeline, are the biggest things to hit Japan since Godzilla itself.
This past Tuesday (March 19th), the German-led Eurozone finance ministers and International Monetary Fund (IMF) offered Cyprus a €10 billion bail-out package. The catch is, this plan requires Cyprus to raise approximately €5.8 billion (almost one-third of Cyprus’ GDP) as its share of the bailout, by Monday (March 25th). Cyprus is a small player in the Eurozone, and in a lot of trouble – could the costs of keeping Cyprus in the Eurozone outweigh the benefits?