Re: Re: Greece
I really don't know enough about the situation to say who--if anyone--deserves the greatest share of the blame for Greece's current problems, but it seems to me like the country is just designed to fail economically. They don't have any particularly important industries, their workforce is aging, and they're absolutely drowning in corruption at every level.
Originally posted by RobtardI think it's less about the amount of the default and more about the panic that it would set off.
Only 2billion? That doesn't seem right. Being in the hole 2billion is nothing for a country on Greece's level. Mark Zuckerberg could bail them out and he wouldn't even feel it.
Just to help out those who don't know the basics of the situation:
- Greece is more than just a member of the EU, it is a member of the Eurozone, the group of countries that use the Euro as currency. Currency Union was supposed to be a one-way street.
- People were very willing to lend to Greece because it was a Eurozone member, so its currency was backed by the whole zone, not just Greece itself. With the ECB and Germany backing the Euro project, large loans seemed safe.
- However, the main starter for the problem was that, to be a Euro member, there were a number of strict financial criteria involved to stop a unsound country bringing the project drown. Greece faked its eligibility for these criteria.
- Having faked their way in, Greece then borrowed money on the new credit terms of being a Eurozone member like mad. Unfortunately, Greece has an exceptionally deficient economy- mostly tourism dependant, lacking in decent exports and struggling hugely with tax corruption that erodes its income.
- After the banking crisis, loans became an issue for everyone, Several Euro countries got hit hard from being over-exposed. Portugal and Ireland are particular examples. They mostly survived via austerity policies which kept the confidence in them secure.
- Greece is not secure and spent far too long not implementing any sort of cutbacks due to over-generous pensions and the like (grand in theory- no good if you don';t actually have the money)
- Hence Greece got caught massively on the hop. At this point the Eurozone mechanism came in to try and save it. The problem is, this basically means the other Eurozone countries plunging giant loans in. This is greatly resistant by the electorate of those countries. For those playing the 'democracy' card, remember all these nations have voters too and further bailouts for Greece are not favoured.
- The problem is that Greece is no fundamentally economically buggered at this point that just pouring loans in won't do it. Greece needs fundamental economic reform, and it is at the point where its creditors, from the ECB to other Eurozone countries to the IMF, won't lend it any more unless it makes massive cuts and social changes. The Greek people are unwilling to do this (and voted out all previous government administrations in favour of a radical left-wing 'no more cuts' party to negotiate, who have totally failed thus far) and we are now at the final moment of the crisis point about who blinks first- either Greece takes the cuts or the Eurozone members forgive the debt.
- There is no possible connection between the US debt and Greece's. The US can go into debt all it likes- everyone has confidence that it will pay, it being a massive economic powerhouse. No-one has any confidence in Greece's ability to pay unless it makes those cuts. This is just a fact of life. No amount of voting or declarations of sovereignty makes any difference to the fact that no-one will lend to a bankrupt country.
- The 2 billion thing is indeed just the latest repayment- this one owed to the IMF. By missing the payment, Greece has become the first First-world country to miss an IMF payment. The total debt is in hundreds of billions.
- Countries go bankrupt, of course- look at Argentina, which almost makes a habit of it. But the kicker here is that Greece ins in the Eurozone- it's not meant to be possible for it to go bankrupt. If it had its own currency, it could just massively devalue and start again, but it can't do anything with the Euro as it is a shared currency. Of course, they should never have been in it in the first place, and the other Eurozone nations were fools to let them in. Nonetheless, the Eurozone acted in good faith.
- On a simple economic view, the loans to Greece should be cut as, basically, they can't pay. But politically this is impossible- Greece cannot be let off the hook if Ireland and Portugal had to do it the hard way, and furthermore, with such a precedent, any Euro country in future could just spend itself to oblivion and expect to be bailed out the same way; it would effectively kill the Euro. In any case, countries like Germany have no democratic mandate to let Greece off, particularly after Greece faked its way in. Germany has already written off as much of the debt as its electorate will allow (unsurprisingly, Germans are not thrilled at their tax dollars being used to bail out Greek corruption).
- So the main projected solution now is that Greece has to do what was meant to be impossible- leave the Euro and start again with its own currency. There's a tiny amount of time remaining for Greece instead to cave in and accept the cuts, but there's little political will for that.
The hardline Greek ruling party has called a referendum on the issue for this Sunday. This was a dumb move- it's taken the negotiating power out of their hands. The Greek party is scrambling to make last moment concessions, but the lenders can't do anything now but say "We can't make any deals until the referendum is done as you can't honour them unless you know the result". It was the worst possible time to call a referendum- the idea seemed to have been to intimidate the lenders into giving way, but that failed. If the Greek party cancels the referendum they might still strike a deal but that would be political suicide as well.
The OP's statement about leaving the EU is misleading- it's the membership fot he Euro that is the issue, ot the EU. The UK is an EU member but we never took the Euro as a currency, electing to keep the pound., And we would be laughing our asses off right now- as this kind of thing is one of the main reasons we never joined- except a tanking Europe is bad for us as well, so this probably just increases general Euroscepticism in the UK, which is a politically sensitive issue right now.
Originally posted by Ushgarak
The OP's statement about leaving the EU is misleading- it's the membership fot he Euro that is the issue, ot the EU.
Nah, not misleading. If asking for opinions is misleading. I didn't get the memo.
Originally posted by Time-Immemorial
Who thinks they will be booted from EU and collapse after this latest shit storm of a almost $2 billion default.
Greece should become independent again. Just declare it's bankrupt, take those money-gambling-bastard-banks-companies with them, and start anew, without debts. Worked in the past for some countries, will work again. It's not like they will be bombed from earth, it's just money some people lose, and thus people gambled knowing they might lose some.
Originally posted by Prof. T.C McAbe
Greece should become independent again. Just declare it's bankrupt, take those money-gambling-bastard-banks-companies with them, and start anew, without debts. Worked in the past for some countries, will work again. It's not like they will be bombed from earth, it's just money some people lose, and thus people gambled knowing they might lose some.
Easiest thing to do with them is toss their corrupt central bank out and issue there own debt free currency.
Originally posted by jaden101
And yet the EU is telling them they're being irresponsible by NOT borrowing more. They're also complaining about the numbers of people wanting to vote in the Greek referendum. Democracy eh? Pfft. Getting in the way of capitalism. Terrible.
This sums it all up to be fair.
Originally posted by Time-Immemorial
Nah, not misleading. If asking for opinions is misleading. I didn't get the memo.
It's misleading because leaving the EU is not on the table; by asking the question you were implying it was. You just mixed up EU and Eurozone is all.
And, again, if democracy is our yardstick, the European democratic consensus is against forgiving the debt. Greek sovereignty does not extend to the money of other countries.
Borrowing more money to service their debt is the only option to stay in the Euro (which is immensely desirable for Greece). If they make the cuts, it is sustainable in the long-term. If they don't, the consequences will be worse than the cuts.
Don't pity Greece. The U.S. is not far off from defaulting either. Only when it happens to us the consequences will be much worse than what Greece is going thru. Printing money like it grows on trees won't work anymore once the dollar loses it's status as world's reserve currency. Many countries are already moving away from the dollar because they no longer see it as the stable currency it use to be.
Inflation in U.S. is already bad enough. Unlike a few years ago, I'm basically living paycheck-to-paycheck barely able to keep my head above water. Seems like everytime I buy groceries that more and more food item packages are getting smaller and smaller while the price either remains the same or rises. Government lies and says that there is "no inflation". LMAO. Any fool who wasn't born yesterday can see thru the fact that it is just being covered up by making food items smaller. That's what happens (massive inflation) when you think you can print all the money you want with no consequences. America isn't immune to the basic rules of economics.
The U.S. probably has 5 years max before it happens and that is being overly optimistic.
Originally posted by Prof. T.C McAbe
Greece should become independent again. Just declare it's bankrupt, take those money-gambling-bastard-banks-companies with them, and start anew, without debts. Worked in the past for some countries, will work again. It's not like they will be bombed from earth, it's just money some people lose, and thus people gambled knowing they might lose some.
I like that Idea! Just take over and tell all your debtors that "I am sorry. It was the previous regime that owed you money. Not the Current Regime. If you wish to file a grievance about this we can send you said previous regime (Or whats left of them) and you can work it out with them.
I REALLY LIKE THIS IDEA!!!!!!!
Originally posted by Star428
Don't pity Greece. The U.S. is not far off from defaulting either. Only when it happens to us the consequences will be much worse than what Greece is going thru. Printing money like it grows on trees won't work anymore once the dollar loses it's status as world's reserve currency. Many countries are already moving away from the dollar because they no longer see it as the stable currency it use to be.Inflation in U.S. is already bad enough. Unlike a few years ago, I'm basically living paycheck-to-paycheck barely able to keep my head above water. Seems like everytime I buy groceries that more and more food item packages are getting smaller and smaller while the price either remains the same or rises. Government lies and says that there is "no inflation". LMAO. Any fool who wasn't born yesterday can see thru the fact that it is just being covered up by making food items smaller. That's what happens (massive inflation) when you think you can print all the money you want with no consequences. America isn't immune to the basic rules of economics.
The U.S. probably has 5 years max before it happens and that is being overly optimistic.
As long as our omniscient government is in place with Obama at the helm, we should be ok right?
Originally posted by Flyattractor
[b]I like that Idea! Just take over and tell all your debtors that "I am sorry. It was the previous regime that owed you money. Not the Current Regime. If you wish to file a grievance about this we can send you said previous regime (Or whats left of them) and you can work it out with them.I REALLY LIKE THIS IDEA!!!!!!!
[/B]
That doesn't work- if you are declared bankrupt, no-one will lend you money, which is a horrific position for a country. Blame the previous administration all you like- no-one will lend anyway.
And this is indeed the exact crisis Greece faces- being cut off from international finance. It's precisely what the Greek government is trying to avoid by striking a deal.
Originally posted by krisblaze
They retire at age 57....This isnt just government/corps screwing people over but people bein genuinely lazy.
Edit: I feel like when conservatives in the US decry "lazy liberals" and "welfare mothers" they're not really talking about actual Americans in any great number, just an imagined bane to America's economy, but many Greeks actually embody these tropes.