Greek Socialists hold emergency talks on austerity

[June 16, 2011]  ATHENS, Greece (AP) -- Greece's embattled governing Socialist party says it is convening an emergency meeting of its lawmakers, after a party revolt threatened to derail the government's efforts to pass crucial austerity measures.

The meeting Thursday afternoon will likely delay an expected cabinet reshuffling by Prime Minister George Papandreou.

Squeezed between international creditors and an angry public, Papandreou announced Wednesday he would reshuffle his cabinet and ask for a confidence vote in parliament after talks to form a coalition government collapsed.

Investors are deeply worried that a default in Greece could hurt banks elsewhere and set off a catastrophic financial chain reaction that experts predict would be catastrophic.

[Associated Press]

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