Greek deficit: 12.7%? 14.5%? 16%?

Ambrose Evans-Pritchard shines his spotlight on the Greek deficit problem and shows it could be much worse than feared. The government cops to a 12.7% of GDP deficit but private estimates are as high as 16% of GDP.

The government has vowed to trim the deficit but most of the steps taken thus far are one-offs; there are no major spending cuts. The risk of further downgrades to Greek debt could be catastrophic as banks would no longer be able to use Greek government bonds for collateral at the ECB.