Greek Leaders Discuss Bonds

    A Greek flag is waved in front of the Greek Parliament while strikers march by during a protest march in Athens marking the 24-hours general strike on December 1, 2011. Greece's new government sees its resolve tested on December 1 as unions take to the streets against the latest austerity cuts demanded by its European peers in return for funds to keep the country afloat. Today's general strike, the sixth this year, has shut down public services and disrupted train and ferry services but flights were not affected and the Athens stock exchange was open, as was most of the capital's metro system. AFP PHOTO / LOUISA GOULIAMAKI (Photo credit should read LOUISA GOULIAMAKI/AFP/Getty Images)

    Louisa Gouliamako, AFP / Getty Images

    Greece has had a string of financial “moments of truth” over the past few months, and it’s time for another one. This time, the country’s leaders are meeting to discuss how big a “writedown” (reduction) private lenders are going to take. It’s a contentious tug-of-war between the massive banks that have fueled Greece’s debt binge, and the country’s cash-strapped government. Earlier this year, European banks agreed to a 50 percent reduction, or “haircut,” valued at 100 billion euros. But Greece’s financial situation has deteriorated even further, so officials are seeking a larger reduction that would cut its national debt by somewhere closer to 70 percent.

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