Most of us can't get far into any article about the Greek debt crisis before coming across several terms that sound like English but don't really make much sense. Yet rather than bothering to find out what they do mean – it's just too much effort and we're not that interested – we tend to assume we've vaguely got the gist of things. As a result, most of us still don't have a firm grasp on what is going on. So here's an idiot's guide to some common misunderstandings regarding recurring terms in the euro debate:

This sounds like shorthand for: "We all know Greece is completely screwed so we'll knock a bit off their debt to make it look a bit less bad to give us some breathing space." Not so. The haircut is actually something the Greeks are proposing to give its creditors; it's basically a way of Greece getting banks/countries to write off some of their debt without anyone having to lose face by calling it a write-off. In other words, if some of the debt isn't written off, Greece threatens to go bankrupt thereby ensuring its creditors gets nothing. It's the kind of sweetheart deal you'd love to make with your own bank.

This has connotations of a reverse Euro Lottery, with some unlucky bank ending up carrying the can for a Greek default. It's not that simple. Greece has many thousands of packages of debt – the loans range from three months to 10 years – with one coming up for repayment almost every day. Except Greece hasn't got the funds to repay the loan, nor is any bank daft enough to lend it any more. So rather than suffer a default, banks merely extend the loan for a longer period. Hence the rollover.

Surely this must be some dodgy financial instrument designed to wave away the debt crisis at a stroke? Well, it might be if the euro bond actually existed, but there isn't a cat in hell's chance they ever will. Greece loves the idea of a euro bond because it basically mean the whole of the eurozone would be responsible for Greece's debt, not just Greece. Understandably the Germans are not keen. As the only solvent country in Europe, the Germans would end up underwriting everyone else's debt. And they aren't that stupid.

The implication of this is that things are basically going in the right direction, if a little slower than would have been ideal. That's what finance ministers and politicians want you to think. They want you to hear the word growth. Actually it's a whole lot worse than that. What it means is that the economy is almost stagnant and, with inflation running at over 4%, we're in the worst recession since the 1930s without the promise of a looming war at the end to kickstart growth. In short, it means the politicians don't have a clue what to do and it really is time to panic.