Greece about to default

[Victorian Gray]

the only negotiating going on now is a financial quarantine of Greece in an attempt to keep the financial mud slide from spreading.

Not enough metaphor mixing. 6/10

 

[werepossum]

I can imagine it now. Confused Greeks asking why Americans built a soccer pitch in a conical shape rather than rectangular, and probably concluding it's because the yanks don't metric.

Lol

I have wondered if the Greek church actually asked for what was built or if the American preacher just really likes baseball.

 

[maddogchen]

It would be awesome if the other euro nations also held a referendum the same day asking if they want to bail out Greece. If Greece says yes and Europe says no, hilarity will ensue

 

[Phynaz]

Stockton, Detroit, Greece...at what point do people learn the truth about libs?

 

[fskimospy]

Stockton, Detroit, Greece...at what point do people learn the truth about libs?

What's 'the truth about libs'?

It's always funny to see ignorant people blame things like this on 'liberals', especially considering that all of Greece's much more successful creditor nations would be considered flaming communists by the American right.

 

[mmntech]

The problem with socialism is you eventually run out of other peoples' money. Tsipras is playing brinksmanship and is hoping to use this referendum as an out. If the people vote "no", he can then defer any fallout to the public and not his party. It's a desperate ploy that would have far reaching consequences if it backfires. Which it most likely will. It also show a leader who is completely incapable of making tough decisions.

I'm not entirely clear on how Greece got into this mess in the first place. Based on what I've been told, Greece essentially got into the Eurozone on false pretences. That the government was cooking the books to make its financial and economic situation look far rosier than it actually was. Which was fine up until the 2008 global economic crisis. Lingering economic problems then became amplified.

In that case, the EU and Germany are 100% in the right about holding off the loans. Greece has offered no concrete plan for getting the economy back on track and getting government overspending under control. Quite the opposite in fact. They want and indeed expect foreign tax payers to prop up their corrupt government with free money. Which certainly isn't fair to the people actually paying their taxes. Greece is notorious for tax evasion.

Tsipras, is insistent on no austerity. That may resonate with his socialist followers, but is of no benefit for the nation. Its trading long term poverty for short term comfort. Worst case scenario is that the people resort to extremist politics if nothing is done. The fact that a neo-Nazi party has gained serious traction there should be ringing some big alarm bells.

 

[fskimospy]

The problem with socialism is you eventually run out of other peoples' money. Tsipras is playing brinksmanship and is hoping to use this referendum as an out. If the people vote "no", he can then defer any fallout to the public and not his party. It's a desperate ploy that would have far reaching consequences if it backfires. Which it most likely will. It also show a leader who is completely incapable of making tough decisions.

I'm not entirely clear on how Greece got into this mess in the first place. Based on what I've been told, Greece essentially got into the Eurozone on false pretences. That the government was cooking the books to make its financial and economic situation look far rosier than it actually was. Which was fine up until the 2008 global economic crisis. Lingering economic problems then became amplified.

In that case, the EU and Germany are 100% in the right about holding off the loans. Greece has offered no concrete plan for getting the economy back on track and getting government overspending under control. Quite the opposite in fact. They want and indeed expect foreign tax payers to prop up their corrupt government with free money. Which certainly isn't fair to the people actually paying their taxes. Greece is notorious for tax evasion.

Tsipras, is insistent on no austerity. That may resonate with his socialist followers, but is of no benefit for the nation. Its trading long term poverty for short term comfort. Worst case scenario is that the people resort to extremist politics if nothing is done. The fact that a neo-Nazi party has gained serious traction there should be ringing some big alarm bells.

As I said above, you realize that Germany and other countries are heavily socialist, right?

Additionally, their government spending is under control as they have a primary surplus. On top of that, their economy is in a massive depression precisely because of the austerity that their creditors have asked for.

They would have HUGE surpluses had their economy performed the way the troika predicted, but the troika made the same mistake so many other people did and vastly underestimated the damage that austerity does to an economy.

Here's their predicted GDP vs. reality:

Austerity isn't working, but it is now looking increasingly likely that it will continue. Too bad for Greece.

 

[Phynaz]

What's 'the truth about libs'?

It's always funny to see ignorant people blame things like this on 'liberals', especially considering that all of Greece's much more successful creditor nations would be considered flaming communists by the American right.

Uhuh...deflect away. Money for nothing libs are driving entire countries into bankruptcy.

Talk about ignorant.

 

[nickqt]

Stockton, Detroit, Greece...at what point do people learn the truth about libs?

Libruls libruls libruls, libruls libruls.

Make sure to leave out successful cities that libruuuls run. Also be sure to leave out hellholes like Kansas or Alabama that conservatives run. Mostly because freedom, but also because Benghazi.

What's 'the truth about libs'?

It's always funny to see ignorant people blame things like this on 'liberals', especially considering that all of Greece's much more successful creditor nations would be considered flaming communists by the American right.

Listen. Don't get in the way of a right-winger repeating its talking points.

Every time a right-winger repeats its talking points, Master Limbaugh gets a Vicodin.

As I said above, you realize that Germany and other countries are heavily socialist, right?

Additionally, their government spending is under control as they have a primary surplus. On top of that, their economy is in a massive depression precisely because of the austerity that their creditors have asked for.

They would have HUGE surpluses had their economy performed the way the troika predicted, but the troika made the same mistake so many other people did and vastly underestimated the damage that austerity does to an economy.

Here's their predicted GDP vs. reality:

Austerity isn't working, but it is now looking increasingly likely that it will continue. Too bad for Greece.

Again, you're bringing in context and facts to describe reality. That's all well and good if you're speaking with someone rooted here in reality. Unfortunately, it's diretected at someone equipped with talking points and only the mental capacity to repeat them, and nothing more.

See below, as talking points conservative offers nothing substantive except the refrain of "Libruls libruls libruls, libruls libruls. Libruls!".

Uhuh...deflect away. Money for nothing libs are driving entire countries into bankruptcy.

Talk about ignorant.

Yes, countries like Germany are doing awful over there in the Eurozone. The conservatives of Germany make Hillary look like a Tea Partier, but hey, keep repeating your talking points like a good drone. Master Limbaugh is counting on you!

 

[Phynaz]

Benghazi? Yeah, okay. Listen I know it's tough, but do try to keep up. We're talking about Greece here.

Post your lib rage elsewhere.

 

[nickqt]

Benghazi? Yeah, okay. Listen I know it's tough, but do try to keep up. We're talking about Greece here.

Post your lib rage elsewhere.

Keep up those "lib blah blah blah" comments that communicate nothing substantive. It means you're winning the war of ideas!

 

[chucky2]

If only Greece would spend more money it doesn't have and never reform (which it will never do to any meaningful degree until it's force to feel the pain), it's economy would be roaring! (well, for the short term, until it needed to borrow more money again, and again, and...well, we get the idea)

Too bad Greece can't just make up more money out of thin air like the magical US printing press...

 

[glenn1]

More make believe by the Keynesian idiots, as if without austerity the Greeks would suddenly be paying their debts. If only their borrowing were in the currency of "primary surplus" or even "more bullshit" rather than Euro they might have something. I'm glad to see the Germans and other creditors are getting out of the payday lending racket. It's well past due for them to recognize their losses rather than the farce of lending someone even more money to pay the interest they can't afford on the earlier loan they took, much less the principal from the earlier loan.

 

[nickqt]

If only Greece would spend more money it doesn't have and never reform (which it will never do to any meaningful degree until it's force to feel the pain), it's economy would be roaring! (well, for the short term, until it needed to borrow more money again, and again, and...well, we get the idea)

Too bad Greece can't just make up more money out of thin air like the magical US printing press...

First off, since you're clearly clueless, Greece is suffering. It has been. But, don't let your ignorance get in the way of scathing, bitter commenting on Greece and how they've got it made and are living on easy street.

 

[Turkish]

Would this be a good time to invest in real estate in Greece or should I wait for the market to dip further?

 

[werepossum]

As I said above, you realize that Germany and other countries are heavily socialist, right?

Additionally, their government spending is under control as they have a primary surplus. On top of that, their economy is in a massive depression precisely because of the austerity that their creditors have asked for.

They would have HUGE surpluses had their economy performed the way the troika predicted, but the troika made the same mistake so many other people did and vastly underestimated the damage that austerity does to an economy.

Here's their predicted GDP vs. reality:

Austerity isn't working, but it is now looking increasingly likely that it will continue. Too bad for Greece.

You continually discuss austerity as if it's a decision freely made, whose only parameter is which economic school one wishes to follow. That is simply not true. Greece has been going down your preferred road for decades, spending more money than it has to spend. Now Greece is in the position of having no one who will loan them any more money until they can show how they are going to pay it back, and no one with any money to lend is willing to lend on the basis of Greece spending its way to prosperity. There. Is. No. More. Available. Money. Period. Unless you have an extra thirty or forty billion euros you can kick in, simply "no have austerity" is not an option.

Greece's current options are two. Greece can cut spending to the point that creditors believe they might actually get paid back. Given the performance of the Greek economy under austerity, that's a very slow path to prosperity that leads first through depression and may well dead end in communism. Or Greece can cut and run, default permanently on its debts, starting printing buttloads of drachmas, and pretend they are worth more than they are. No matter how naughty you imagine Germany to have been, the Germans have tired of supporting the Greek lifestyle, and as neither you nor Greece is in a position to take over Germany that's pretty much the end of that.

Personally I think Greece should default and drop the euro. Printing a surplus of drachmas will result in those drachmas being worth less, but mainly to other nations. Right now, Greece is borrowing money of which a significant portion goes to buy imported goods. Just as with America and China, when one buys from a nation that does not buy from you, one has less wealth in one's economy. A relatively worthless Greek currency would encourage Greek manufacturing and encourage Greece to buy domestic - one might find French wine worth twice as much as Greek wine, but maybe not four or five or six times as much. Unfortunately for Greece they are far too small to be self-sufficient, but shifting Greek tastes and expectations to domestically produced goods should broaden the available Greek-produced goods as well as strengthen their economy.

 

[WelshBloke]

No matter how naughty you imagine Germany to have been, the Germans have tired of supporting the Greek lifestyle, and as neither you nor Greece is in a position to take over Germany that's pretty much the end of that..

Germany isn't supporting the Greek lifestyle (whatever that is). They are supporting interest payment on Greek debts that are being made to EU banks (including, strangely enough, German banks).

It'll be public monies being funneled into banking profits.

 

[werepossum]

Germany isn't supporting the Greek lifestyle (whatever that is). They are supporting interest payment on Greek debts that are being made to EU banks (including, strangely enough, German banks).

It'll be public monies being funneled into banking profits.

If that were true, then Greece would be making its payments. Greece is not making its payments.

 

[fskimospy]

You continually discuss austerity as if it's a decision freely made, whose only parameter is which economic school one wishes to follow. That is simply not true. Greece has been going down your preferred road for decades, spending more money than it has to spend. Now Greece is in the position of having no one who will loan them any more money until they can show how they are going to pay it back, and no one with any money to lend is willing to lend on the basis of Greece spending its way to prosperity. There. Is. No. More. Available. Money. Period. Unless you have an extra thirty or forty billion euros you can kick in, simply "no have austerity" is not an option.

Of course there is more available money. That's what this is all about. (And has been since 2010) It has always been about what strings the creditors are going to attach to their funds. We have seen the results of the demands for austerity so far, and it has been such a failure that it seems that after all these reforms that Greece is in a WORSE position to pay its creditors back, not better. That's obvious policy failure. If the troika had demanded more gradual cuts and smaller primary surpluses they would probably be in a far better position to be paid back. Instead, they embarked on a foolish policy of fiscal demands that have beggared Greece and put their investments at risk. Dumb, dumb, dumb.

Greece's current options are two. Greece can cut spending to the point that creditors believe they might actually get paid back. Given the performance of the Greek economy under austerity, that's a very slow path to prosperity that leads first through depression and may well dead end in communism. Or Greece can cut and run, default permanently on its debts, starting printing buttloads of drachmas, and pretend they are worth more than they are. No matter how naughty you imagine Germany to have been, the Germans have tired of supporting the Greek lifestyle, and as neither you nor Greece is in a position to take over Germany that's pretty much the end of that.

Except of course the cuts to spending have made their ability to repay their loans less, not more. In deeply depressed economies like this where monetary policy can't offset fiscal policy austerity is self defeating.

Personally I think Greece should default and drop the euro. Printing a surplus of drachmas will result in those drachmas being worth less, but mainly to other nations. Right now, Greece is borrowing money of which a significant portion goes to buy imported goods. Just as with America and China, when one buys from a nation that does not buy from you, one has less wealth in one's economy. A relatively worthless Greek currency would encourage Greek manufacturing and encourage Greece to buy domestic - one might find French wine worth twice as much as Greek wine, but maybe not four or five or six times as much. Unfortunately for Greece they are far too small to be self-sufficient, but shifting Greek tastes and expectations to domestically produced goods should broaden the available Greek-produced goods as well as strengthen their economy.

I agree that given the current demands their best policy is probably to default. It will be bad, but probably not as bad as the alternative.

 

[Phynaz]

Keep up those "lib blah blah blah" comments that communicate nothing substantive. It means you're winning the war of ideas!

Herp a derp a burp!

Can't attack the idea, attack the person.

 

[WelshBloke]

If that were true, then Greece would be making its payments. Greece is not making its payments.

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

 

[nickqt]

Herp a derp a burp!

Can't attack the idea, attack the person.

You're hilarious!

Can't attack the idea, attack the person?

Like saying nothing of substance while screaming about "libs"?

Keep on keepin' on!

Stockton, Detroit, Greece...at what point do people learn the truth about libs?

Uhuh...deflect away. Money for nothing libs are driving entire countries into bankruptcy.

Talk about ignorant.

Benghazi? Yeah, okay. Listen I know it's tough, but do try to keep up. We're talking about Greece here.

Post your lib rage elsewhere.

 

[Jaskalas]

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

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

 

[Charmonium]

Except of course the cuts to spending have made their ability to repay their loans less, not more. In deeply depressed economies like this where monetary policy can't offset fiscal policy austerity is self defeating.

That's true. Under standard Keynesian policy, the govt is supposed to spend during a recession and save during an expansion. This let's the government counterbalance the normal economic cycle by using govt spending to offset the swings in consumer/corporate spending. Also under standard monetary policy, the central bank is supposed to create money and lower interest rates during an economic contraction/recession and reduce the money supply/raise rates during an expansion.

The problem with the EU is that there is no central fiscal authority nor any meaningful controls over the fiscal policies of member states. There is the ECB to act as the central bank but there is dissension among EU members about the extent to which the ECB should engage in pro-active monetary policy.

 

[werepossum]

Of course there is more available money. That's what this is all about. (And has been since 2010) It has always been about what strings the creditors are going to attach to their funds. We have seen the results of the demands for austerity so far, and it has been such a failure that it seems that after all these reforms that Greece is in a WORSE position to pay its creditors back, not better. That's obvious policy failure. If the troika had demanded more gradual cuts and smaller primary surpluses they would probably be in a far better position to be paid back. Instead, they embarked on a foolish policy of fiscal demands that have beggared Greece and put their investments at risk. Dumb, dumb, dumb.

Except of course the cuts to spending have made their ability to repay their loans less, not more. In deeply depressed economies like this where monetary policy can't offset fiscal policy austerity is self defeating.

I agree that given the current demands their best policy is probably to default. It will be bad, but probably not as bad as the alternative.

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?