The Washington Post: 3 big ways the crisis in Greece could affect Americans personally

Demonstrators hold flags and banners in front of Parliament in Athens in February. (Simela Pantzartzi/EPA)

By Ylan Q. Mui
July 5, 2015 at 2:55 PM

The financial crisis in Greece has upended the lives — and livelihoods — of residents of the Mediterranean nation. The shutdown of the banking system has resulted in long lines at ATMs to withdraw a daily maximum of just 60 euros, about $67. Citizens have stockpiled food and fuel, leading to empty shelves at grocery stores and crowded gas stations. Business leaders have warned that shortages of crucial medicines could be next.

It is the worst economic downturn faced by any developed nation since World War II. It strikes at the heart of the single currency that unites the 19-member euro zone and threatens to destabilize a fragile region.

But for Main Street U.S.A., the ripple effects are few and far between. Here are the three big ways the Greek debt crisis — which is likely to intensify in coming days, after Greece rejected a European bailout package Sunday — could affect you personally, from your stock market and summer travel plans to how much it costs to buy a house.

1) Your 401(k) could get scary

Markets around the world plunged after negotiations broke down late last month between Greece and its European creditors. The Standard & Poor’s 500-stock index logged its worst day so far this year, falling more than 2 percent. Analysts worried that the turmoil in Greece could signal the end of the six-year bull market in the United States. For those with a 401(k) retirement savings plan, the sell-off was a painful reminder of the volatility on Wall Street during the 2008 global financial crisis.

But it didn’t appear to last — at least, not so far. U.S. markets regained much of their ground the next day and ended the short holiday trading week well off their lows. A recent survey of investors by Barclays found that more than half thought that even a worst-case scenario in which Greece gets booted from the euro zone would register only as a blip in global markets. The United States has little direct exposure to the Greek debt crisis, and central banks have done a lot to set up firewalls against a broader panic. Only if the crisis spread badly to other countries such as Portugal and Italy would there be true reason for concern.

2) Your vacation could get cheaper

The instability in Europe and the massive stimulus program by the region’s central bank have sent the euro plunging against the dollar. The currency hit a 12-year low in March — of $1.05 — before inching back up. But it began sliding again in mid-June as the crisis in Greece ramped up.

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