Greece is in debt, and its people are rioting in the streets. Fitch recently downgraded the nation's credit rating to BBB-, which is among the lowest scores accessible. The European Union might make debt relief possible for Greece, but only if they're prepared to contribute many billions of Euros within the name of Greece's debt. Greece must borrow to repay their debt by May 19, but this could be a lot more difficult than ever, now the Greece debt has been saddled with junk status, as outlined by Sky News Online . The result of junk status is that holders of outstanding 10-year Greek sovereign bonds are now requiring a lot more than a 10 percent rate of return from the government. That's the highest ever recorded in the eurozone, according to Sky News.

Greece debt equals junk and high risk to investors

As a result of the junk rating applied to the Greece debt and also the application of the debt to Greek bonds, Sky News states that "big investors like pension funds will no longer be allowed to purchase the country's debt." This conundrum would place Greece and their debt in the exact same arena of financial calamity as nations like Colombia, Romania and Azerbaijan. Greek citizens are desperate for solutions to separate Greece from debt; their protests outside the offices of the finance ministry are but one sign. Economists like Koen De Leus of KBC Securities tell Sky News that if a solution for how to manage Greece's debt is not in place soon, the entire European market could be dragged down. Both the value of the euro in relation to the dollar and European stocks have dropped. This impacted the Dow Jones also, which experienced a 200-point drop by the end of trading.

Finance minister says Greece will pay debt 'absolutely and without any doubt'

Finance Minister George Papaconstantinou claims Greece will settle debt by the May 19 deadline, but investors have proven to be less than confident of this proclamation. Alistair Darling, Britain's Chancellor of the Exchequer, exclaimed before the International Monetary Fund, European Central bank and other financial conglomerations that it is "absolutely essential" the problem of Greece and debt be handled with expediency. Will Greece deal with their debt with a lot more than payday loans from the European Union?

Resources

Sky News Online

http://news.sky.com/skynews/Home/World-News/Greeces-Sovereign-Debt-Downgraded-To-Junk-Status-Sending-Stock-Markets-Tumbling/Article/201004415621202?f=rss