Greece about to default

[WelshBloke]

If only someone would make their payments for them...

Is that supposed to be a serious response?

Greeces debt is unsustainable. There's no way they can continue to service the debt and function as a country. If their creditors want them to continue to make payments then they either need to write off some of the debt or someone needs to continue to lend Greece ever increasing amounts of money.

 

[nickqt]

lol Okay . . .

Greece's debt is near double its GDP. Can you imagine a time when you would concede that there isn't any more available money? Some mythical point at which even you would concede that Greece borrowing more money or anyone loaning more money to Greece might not be the panacea you believe it to be today? Right now Greece cannot support itself even having defaulted on its interest payments, so loaning more money pretty much accepts that the money previously loaned is but a gift. Who then should open his pockets and gift Greece more?

It's also illustrative to look at the other PIGS nations, who embraced austerity more or less to stave off collapse. Ireland and Spain are both recovering nicely, and Portugal only a bit less well. All three have growth which is projected to continue throughout fall 2015, although admittedly for Portugal that's dependent on not voting in a socialist party who promises to return to the pre-austerity days. If austerity is a failing proposition, why did it work for three of the four PIGS nations?

Greece doesn't have to borrow another Euro for there to be more money. Greece's creditors can simply allow Greece to pay back its debt without inflicting even more austerity on its citizens. But, the banks just don't care, because Banks have more rights than People in today's world. Just an artifact of finance being 40% of the economy.

 

[ctbaars]

Can you expand on the nickqt? Greece doesn't have to borrow another Euro if what?

 

[werepossum]

Greece has been making its payments. It just missed its first one.

Has it really?
In April 2010, Greece received a €110 billion Eurozone bailout because it was about to default.
In July 2011, Greece received a €109 billion European Financial Stability Program bailout because it was about to default.
In October 2011, Greece was granted a 50% debt write-down because it was about to default.
In February 2012, Greece received a €130 billion EU bailout because it was about to default.
In March 2012, Greece's private sector lendors agree to roughly 50% payback under a debt swap agreement, fearing that Greece is about to default.
In April 2014, Greece receives another €8 billion EU bailout AND takes on another $4 billion in private sector debt, based on budget projections showing the nation was returning to growth.
In February 2015, Greece is granted a four month extension in paying back its emergency loans.
In July 2015, Greece does not make its scheduled payment. http://www.bbc.com/news/world-europe-17373216

If that's "making its payments" then Bernie Madoff is an investment genius.

 

[fskimospy]

lol Okay . . .

Greece's debt is near double its GDP. Can you imagine a time when you would concede that there isn't any more available money? Some mythical point at which even you would concede that Greece borrowing more money or anyone loaning more money to Greece might not be the panacea you believe it to be today? Right now Greece cannot support itself even having defaulted on its interest payments, so loaning more money pretty much accepts that the money previously loaned is but a gift. Who then should open his pockets and gift Greece more?

It's also illustrative to look at the other PIGS nations, who embraced austerity more or less to stave off collapse. Ireland and Spain are both recovering nicely, and Portugal only a bit less well. All three have growth which is projected to continue throughout fall 2015, although admittedly for Portugal that's dependent on not voting in a socialist party who promises to return to the pre-austerity days. If austerity is a failing proposition, why did it work for three of the four PIGS nations?

It is baffling that you would say there is no more money when the entire debate is over the terms for more money. This makes no sense.

And if you think austerity worked well for those other countries I have to question your ability to read the economic data. It has been a disaster for them as well.

 

[Ns1]

Greece doesn't have to borrow another Euro for there to be more money. Greece's creditors can simply allow Greece to pay back its debt without inflicting even more austerity on its citizens.

Greece doesn't have to deal with austerity unless they borrow more money.

It is baffling that you would say there is no more money when the entire debate is over the terms for more money. This makes no sense.

"Don't throw good money after bad"

 

[werepossum]

It is baffling that you would say there is no more money when the entire debate is over the terms for more money. This makes no sense.

And if you think austerity worked well for those other countries I have to question your ability to read the economic data. It has been a disaster for them as well.

<sigh> I hope you are putting your money where your mouth is and loading up on Greek securities.

 

[werepossum]

Greece doesn't have to borrow another Euro for there to be more money. Greece's creditors can simply allow Greece to pay back its debt without inflicting even more austerity on its citizens. But, the banks just don't care, because Banks have more rights than People in today's world. Just an artifact of finance being 40% of the economy.

The bolded pretty much says it all. You feel that banks should care; therefore they should just not ask for their money back.

Greece is asking for an emergency loan because it fears it cannot make its upcoming federal payroll and pension, even having just defaulted. If Greece never borrows another cent, it still has fundamental problems that must be addressed, and it still cannot support itself.

 

[fskimospy]

<sigh> I hope you are putting your money where your mouth is and loading up on Greek securities.

That doesn't make any sense.

 

[werepossum]

That doesn't make any sense.

Right. It makes sense for other people to loan Greece money, it just doesn't make sense for you to loan Greece money.

 

[nickqt]

The bolded pretty much says it all. You feel that banks should care; therefore they should just not ask for their money back.

Greece is asking for an emergency loan because it fears it cannot make its upcoming federal payroll and pension, even having just defaulted. If Greece never borrows another cent, it still has fundamental problems that must be addressed, and it still cannot support itself.

No, I don't think banks should care. They are designed to suck in as much money as possible, in any way possible. Some banks are smart and allow the money to trickle in safely, and some take stupid risks. It's a two-way street.

What I am saying is that the human beings running those banks could take a look at what has occurred to the average Greek citizen because of what the Greek elites screwed up, and change how the money gets paid back. Or not. If money trumps people, which it does here in observable reality, then I don't expect banks and their human operators to care one way or another. But, it's a two-way street.

The banks, and the human beings running those banks who don't care are now seeing what happens when the people running Greece now don't care about repaying loans.

Greece defaulting and leaving the Euro doesn't just hurt the Greeks. But again, this is all an artifact of finance running 40% of the economy now. So hey, cheers to the banks for being banks. They made stupid decisions and perhaps won't be getting their money back. No sweat off my sack.

I simply wanted to state that none of this has to happen this way, and that it's political. If the ECB is tired of helping Greece, then so be it. But Greece doesn't have to default. Hell, the entire debt could be forgiven. Likely, of course not, but totally possible.

What this shows other countries is that if they don't get their shit in line, they may get dropped too. If letting the economies of countries that you're ostensibly in a monetary union with collapse is better than continuing to help that country, then it shows just how weak of a union it is. Ultimately, it's probably good for US currency and shows just how unlikely any other world currency is at overtaking the dollar at being the reserve currency.

But I digress.

 

[WelshBloke]

If that's "making its payments" then Bernie Madoff is an investment genius.

?

It made all those payments except the last one.

Its exactly as I stated. If the creditors want to continue to get paid they will have to reduce the debt to sustainable levels or someone will need to lend Greece ever increasing amounts of money.

 

[Ns1]

n/m

 

[fskimospy]

Right. It makes sense for other people to loan Greece money, it just doesn't make sense for you to loan Greece money.

Huh?

 

[Hugo Drax]

They will be bailed out. Too many fat cats holding greek paper. The public will bail greece, the fat cats holding the paper get made whole.

 

[werepossum]

Huh?

SERIOUSLY?

1. Greece sells bonds.
2. Bonds are a form of loan - they get the money now, some time in the future you get repaid with interest.
3. You think people need to loan Greece more money so they don't have to suffer mean ol' austerity.
4. You should buy Greek bonds, thereby loaning Greece money.

They will be bailed out. Too many fat cats holding greek paper. The public will bail greece, the fat cats holding the paper get made whole.

Maybe. That is the way it usually works, but most of Greece's private debtors have already been scalped, taking roughly 50% losses to get safer EU debt. Right now it's mostly governmental debt and government-guaranteed debt, to my understanding.

 

[fskimospy]

SERIOUSLY?

1. Greece sells bonds.
2. Bonds are a form of loan - they get the money now, some time in the future you get repaid with interest.
3. You think people need to loan Greece more money so they don't have to suffer mean ol' austerity.
4. You should buy Greek bonds, thereby loaning Greece money.


Maybe. That is the way it usually works, but most of Greece's private debtors have already been scalped, taking roughly 50% losses to get safer EU debt. Right now it's mostly governmental debt and government-guaranteed debt, to my understanding.

That makes absolutely no sense. Do you understand how investing works? If you think what you said is a good idea, I hope you are not in charge of anyone's portfolio.

Seriously, this is next level dumb.

 

[Charmonium]

Greeks seem to be leaning 'no' - http://www.reuters.com/article/2015/07/01/us-eurozone-greece-poll-idUSKCN0PB3HQ20150701

 

[werepossum]

That makes absolutely no sense. Do you understand how investing works? If you think what you said is a good idea, I hope you are not in charge of anyone's portfolio.

Seriously, this is next level dumb.

THAT. WAS. MY. POINT!

Sheesh! Where do you think money for Greece comes from? Hint: It doesn't fall out of flying unicorns' butts. It's accumulated capital, same as any other capital. You are at least capable of understanding that Greece is a monumentally bad risk for YOUR money, yet you insist that it's a good risk for other people's money. Buy a clue, dude - people in Germany, France, Italy, even Spain are on the hook for money loaned to Greece. They are real people, and they count just as much as do Greeks. Even if they are willing to loan Greece money to help out, they aren't willing to keep shovelling their money down Greece's black hole. Every one of those nations has things it would like to do for its own citizens - things they now will not be able to do because they lost that capital by loaning it to Greece who defaulted.

Every time Greece gets free money, someone else has to lose that money.

 

[Zorkorist]

No, I don't think banks should care. They are designed to suck in as much money as possible, in any way possible. Some banks are smart and allow the money to trickle in safely, and some take stupid risks. It's a two-way street.

What I am saying is that the human beings running those banks could take a look at what has occurred to the average Greek citizen because of what the Greek elites screwed up, and change how the money gets paid back. Or not. If money trumps people, which it does here in observable reality, then I don't expect banks and their human operators to care one way or another. But, it's a two-way street.

The banks, and the human beings running those banks who don't care are now seeing what happens when the people running Greece now don't care about repaying loans.

Greece defaulting and leaving the Euro doesn't just hurt the Greeks. But again, this is all an artifact of finance running 40% of the economy now. So hey, cheers to the banks for being banks. They made stupid decisions and perhaps won't be getting their money back. No sweat off my sack.

I simply wanted to state that none of this has to happen this way, and that it's political. If the ECB is tired of helping Greece, then so be it. But Greece doesn't have to default. Hell, the entire debt could be forgiven. Likely, of course not, but totally possible.

What this shows other countries is that if they don't get their shit in line, they may get dropped too. If letting the economies of countries that you're ostensibly in a monetary union with collapse is better than continuing to help that country, then it shows just how weak of a union it is. Ultimately, it's probably good for US currency and shows just how unlikely any other world currency is at overtaking the dollar at being the reserve currency.

But I digress.

People can live without Government, but Government can't live without people.

This is a failure of Government, pretty much as expected.

The people themselves, will be fine.

-John

 

[Greenman]

It is baffling that you would say there is no more money when the entire debate is over the terms for more money. This makes no sense.

And if you think austerity worked well for those other countries I have to question your ability to read the economic data. It has been a disaster for them as well.

I was listening to a fellow on the radio today that claimed the EU will give them another loan, and continue giving them more for the foreseeable future. The idea being that them leaving the EU is worse than loosing a boat load of money. If so, it's a great setup for the Greeks, they might be able to quit working altogether.

 

[fskimospy]

THAT. WAS. MY. POINT!

Sheesh! Where do you think money for Greece comes from? Hint: It doesn't fall out of flying unicorns' butts. It's accumulated capital, same as any other capital. You are at least capable of understanding that Greece is a monumentally bad risk for YOUR money, yet you insist that it's a good risk for other people's money. Buy a clue, dude - people in Germany, France, Italy, even Spain are on the hook for money loaned to Greece. They are real people, and they count just as much as do Greeks. Even if they are willing to loan Greece money to help out, they aren't willing to keep shovelling their money down Greece's black hole. Every one of those nations has things it would like to do for its own citizens - things they now will not be able to do because they lost that capital by loaning it to Greece who defaulted.

Every time Greece gets free money, someone else has to lose that money.

No, that's not the case at all. I don't own any Greek debt currently. Other people do. Their goal is the return of their principal, which is a fundamentally different calculation. Accepting a small loss or delayed payment is far better than nothing at all, while jumping into an investment now is not something I would do. Furthermore, I wouldn't buy their debt now in large part because of the foolish austerity plan the troika is trying to implement, which I have no control over.

I'm not sure how this is hard to understand?

 

[Moonbeam]

No, that's not the case at all. I don't own any Greek debt currently. Other people do. Their goal is the return of their principal, which is a fundamentally different calculation. Accepting a small loss or delayed payment is far better than nothing at all, while jumping into an investment now is not something I would do. Furthermore, I wouldn't buy their debt now in large part because of the foolish austerity plan the troika is trying to implement, which I have no control over.

I'm not sure how this is hard to understand?

It might be like explaining holding capacity to a sieve.

 

[glenn1]

No, I don't think banks should care. They are designed to suck in as much money as possible, in any way possible. Some banks are smart and allow the money to trickle in safely, and some take stupid risks. It's a two-way street.

What I am saying is that the human beings running those banks could take a look at what has occurred to the average Greek citizen because of what the Greek elites screwed up, and change how the money gets paid back. Or not. If money trumps people, which it does here in observable reality, then I don't expect banks and their human operators to care one way or another. But, it's a two-way street.

The banks, and the human beings running those banks who don't care are now seeing what happens when the people running Greece now don't care about repaying loans.

Greece defaulting and leaving the Euro doesn't just hurt the Greeks. But again, this is all an artifact of finance running 40% of the economy now. So hey, cheers to the banks for being banks. They made stupid decisions and perhaps won't be getting their money back. No sweat off my sack.

I simply wanted to state that none of this has to happen this way, and that it's political. If the ECB is tired of helping Greece, then so be it. But Greece doesn't have to default. Hell, the entire debt could be forgiven. Likely, of course not, but totally possible.

What this shows other countries is that if they don't get their shit in line, they may get dropped too. If letting the economies of countries that you're ostensibly in a monetary union with collapse is better than continuing to help that country, then it shows just how weak of a union it is. Ultimately, it's probably good for US currency and shows just how unlikely any other world currency is at overtaking the dollar at being the reserve currency.

But I digress.

If a large company decided to default on its due employee payroll, would you say those employees and the human beings running their labor union should look at what happened to the company because the management screwed up, and change how the money gets paid back?

So if you don't think that "little guy" employees should have to adjust to the wants and desires of the company just to get their salary money legally owed, then why should creditors who have the same entitlement to get the money legally owed to them by the Greeks?

 

[glenn1]

I was listening to a fellow on the radio today that claimed the EU will give them another loan, and continue giving them more for the foreseeable future. The idea being that them leaving the EU is worse than loosing a boat load of money. If so, it's a great setup for the Greeks, they might be able to quit working altogether.

The Germans and other creditors realize their principal is lost either way. The primary concern now is to keep the principal amount lost from rising further by eliminating further bailouts and throwing good money after bad. When even the New York Times is telling the Greeks they fucked up...

http://www.nytimes.com/2015/07/02/u...usterity-debate-it-failed.html?abt=0002&abg=0