Greece Finalizes Bailout

Greece today accepted a stunning bailout from the IMF and EU totaling over 100 billion euros ($133 billion). In exchange for the bailout Greece agreed to strict budget cuts aimed at reducing the nation's massive budget deficit.

The budget cuts amount to 30 billion euros ($40 billion) over three years. The government told Greeks that it was a choice between rescue or economic collapse. Salaries and pensions will be frozen during the three-year program while a fund backed by the IMF and EU would be set up to help Greek banks. Value-added taxes and duties on fule and alcohol are set to rise.

The financial bailout will last three years and two-thirds of the funds will come from Greece's 15 euro-area partners. The bailout should help to stabilize the single currency after many began to speculate that Greece may leave the euro currency or even the European Union.

The bailout should serve to calm global markets which have been rattled in recent weeks while awaiting clarity on Greece's fiscal situation. Yields rose dramatically on government debt in Greece, Spain and Portugal last week amid the market turmoil.