From the Financial Times: Greece agrees €24bn austerity package

Greece has agreed the outline of a €24bn austerity package, including a three-year wage freeze for public sector workers, in return for a multibillion-euro loan from the eurozone and the International Monetary Fund ...

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European leaders raced on Thursday to complete their part of a long-delayed financial rescue package for Greece, hoping to head off a chain reaction against other heavily indebted European nations that could turn into a financial meltdown across the continent.

The final details are still being worked out, but apparently the value-added tax (VAT) will be increased, public sector workers will lose their two large bonuses, and the retirement age will be increased significantly among other measures. This is intended to reduce the budget deficit by 10+ percentage points over 3 years.From the NY Times: Europe Moves Swiftly on Greek Rescue Plan People have been comparing Greece to Lehman, but maybe a better comparison would be to Morgan Stanley (the bank everyone thought was next before TARP). This might be the beginning of the European sovereign TARP.