There has been much skepticism about Greece's fiscal progress and interim reports suggesting that it was recording a budget surplus when debt servicing, and one-off factors were excluded, were greeted with scorn. And even some of those accepting that it had recorded a primary budget surplus warned that this will increase the likelihood of a default. We disagreed. After the private sector debt restructuring, the lion's share of the debt is in the hands of the official sector. The examples of debt restructuring when a primary surplus was achieved are based on private sector holdings. Rather than default, we thought ... (full story)