Greece about to default

[theeedude]

Who in their right mind runs a fiscal surplus during an equivalent of the Great Depression, after seeing how the last 5 years of austerity worked out for Greece? I guess our Republicans may be stupid enough to say they would while someone else is in the White House, but everyone knows they wouldn't if it was their butts on the line.
I mean these Eurocrats are so out of touch with reality, forget Greece, I think the whole Euro is going to disintegrate if it doesn't get some new management.

 

[norseamd]

I mean these Eurocrats are so out of touch with reality, forget Greece, I think the whole Euro is going to disintegrate if it doesn't get some new management.

Starting to look that way. As an American I do not know that much about the EU but over the last few years I have started to understand all the bullshit that goes on in EU politics.

 

[theeedude]

We have seen how weak the bonds of the EU are. Greece is about to leave over disagreements over the terms of already failed austerity that Europe wants to continue to impose on it. The whole thing is a farce. You can't pretend like you have a real union if you let this happen. They are neighbors, not a family.

 

[Ns1]

We have seen how weak the bonds of the EU are. Greece is about to leave over disagreements over the terms of already failed austerity that Europe wants to continue to impose on it. The whole thing is a farce. You can't pretend like you have a real union if you let this happen. They are neighbors, not a family.

If your brother keeps asking to borrow money and never pays you back you don't keep letting him borrow money.

 

[theeedude]

If your brother keeps asking to borrow money and never pays you back you don't keep letting him borrow money.

Maybe not, but you don't foreclose on his house and leave him homeless, and then pretend you are actually a family.

 

[Ns1]

Maybe not, but you don't foreclose on his house and leave him homeless, and then pretend you are actually a family.

Evidently you're not from a European family.


And you're not actually foreclosing on his house, you're just not giving him the money that he needs to make the interest payment ^_^

 

[BigDH01]

We have seen how weak the bonds of the EU are. Greece is about to leave over disagreements over the terms of already failed austerity that Europe wants to continue to impose on it. The whole thing is a farce. You can't pretend like you have a real union if you let this happen. They are neighbors, not a family.

While austerity will not work for Greece (or any economy in a depression), Greece does have a legitimate structural problem with endemic tax fraud, nepotism, and overly-generous government jobs and pensions. If you're sitting in Slovakia right now, you've really got to be wondering why your money is going to some pensioner in Greece that lives a much better life than you do.

I think the EZ is doomed to fail, but they cannot just keep "bailing out" Greece as the other nations will learn that the EZ is not going to kick anyone out and all fiscal discipline will evaporate. Should've never separated fiscal and monetary policies.

 

[Zorkorist]

This is a failure of big Government, and should be a warning to all that think that Government is the answer.

Along with Greece failing, there is Ireland, Spain, Portugal, etc., waiting in the wings.

Oh, we will "Govern" you. We will be EuroZone... didn't work so well.

We will plan it all out, and everyone succeeds... didn't work so well.

Thiefs, and bankers, and governments and ... really screwed over people is what we end up with.

-John

 

[Zorkorist]

Reminds me of our 18 Trillion Dollar debt.

-John

 

[Svnla]

Stock markets are getting nervous because of this fiasco and Puerto Rico (PR) and other potential ticking financial bombs.

US market is down = http://abcnews.go.com/Business/wireStory/dow-jones-industrial-average-fared-monday-32113531

chinese market is down and going lower = https://fortune.com/2015/06/29/china-stock-market-volatility/

Stay tuned folks, this will be a bumpy ride.

 

[Zorkorist]

Puerto Rico, (PR) asked for Bankruptcy today.

How do you do that? How does a nation go bankrupt?

Government, duh.

-John

 

[Zorkorist]

Thieves, with the authority of an army, or Government.

-John

 

[StinkyPinky]

Is anyone surprised the EU is slowly unravelling? You just have a huge collection of different cultures, ideologies, history, economies, all forced into one square peg. Many of these countries don't even really like each other.

The repercussions of Greece leaving would be huge. Don't forget the UK is having a referendum on leaving the EU as well. Granted the UK don't use the Euro but that's a big blow if they go. Once they see Greece bailing out I imagine British voters would be less willing to stay.

The EU is broken because it got too big, too quick, and didn't take the time to stabilise itself.

 

[nickqt]

Is anyone surprised the EU is slowly unravelling? You just have a huge collection of different cultures, ideologies, history, economies, all forced into one square peg. Many of these countries don't even really like each other.

The repercussions of Greece leaving would be huge. Don't forget the UK is having a referendum on leaving the EU as well. Granted the UK don't use the Euro but that's a big blow if they go. Once they see Greece bailing out I imagine British voters would be less willing to stay.

The EU is broken because it got too big, too quick, and didn't take the time to stabilise itself.

The EU is also broken because it is economic union that is using defacto German currency.

They may have lost control over Europe at the end of WWII, but they have the reins again with the Euro currency.

 

[WelshBloke]

The repercussions of Greece leaving would be huge. Don't forget the UK is having a referendum on leaving the EU as well. Granted the UK don't use the Euro but that's a big blow if they go. Once they see Greece bailing out I imagine British voters would be less willing to stay. .

We might well leave, but I don't think that grexit will change attitudes here much.

Its more about the thousands of migrants piling up in Calais and the loss of Sovereignty to various EU institutions that affects attitudes here I think.

I don't think that us leaving would necessarily be that big a blow either way.

 

[OverVolt]

This is what... 10-20 years in the making?

Good idea at the time.

 

[OverVolt]

The EU is also broken because it is economic union that is using defacto German currency.

They may have lost control over Europe at the end of WWII, but they have the reins again with the Euro currency.

Well it was a good idea at the time. Way to stomp on the dream of a unified Europe there buzzkillington. Why don't you pay off Greece's debts yourself.

 

[nickqt]

Well it was a good idea at the time. Way to stomp on the dream of a unified Europe there buzzkillington. Why don't you pay off Greece's debts yourself.

The EU and the Euro were designed to destroy the social safety nets of European countries. That Germany also gets defacto control of the currency is just a bonus to Germany.

And it's working as intended. Hooray!

http://www.theguardian.com/commentisfree/2012/jun/26/robert-mundell-evil-genius-euro

 

[DucatiMonster696]

The EU and the Euro were designed to destroy the social safety nets of European countries. That Germany also gets defacto control of the currency is just a bonus to Germany.

And it's working as intended. Hooray!

http://www.theguardian.com/commentisfree/2012/jun/26/robert-mundell-evil-genius-euro

Opinions are like buttholes. Everyone has one but some are not worth entertaining because they stink and reek of a strong odor of a personal bias.

 

[nickqt]

Opinions are like buttholes. Everyone has one but some are not worth entertaining because they stink of a bias and agenda.

Right back at ya, hotshot.

 

[OverVolt]

Opinions are like buttholes. Everyone has one but some are not worth entertaining because they stink and reek of a strong odor of a personal bias.

You entertain buttholes?

 

[Jaskalas]

The economic models being practiced just aren't feasible. Shortcuts are taken (pyramid schemes) to loot today and pay tomorrow. Well tomorrow has dawned for Greece.

Economic looting has consequences.
Don't promise what you cannot pay.

 

[theeedude]

While austerity will not work for Greece (or any economy in a depression), Greece does have a legitimate structural problem with endemic tax fraud, nepotism, and overly-generous government jobs and pensions. If you're sitting in Slovakia right now, you've really got to be wondering why your money is going to some pensioner in Greece that lives a much better life than you do.

I think the EZ is doomed to fail, but they cannot just keep "bailing out" Greece as the other nations will learn that the EZ is not going to kick anyone out and all fiscal discipline will evaporate. Should've never separated fiscal and monetary policies.

Let's put some things into context.
Greece ran a budget surplus last year of $2B, or 1% of GDP. In the middle of the equivalent of a Great Depression, with 25%+ unemployment, and 50% youth unemployment. US could barely manage to balance the budget during the boom years of the Clinton administration. The issue is that Greece's debt load from the past is unsustainable, not that its current fiscal policy is too loose. Greece needs its past debts restructured and written off, and it needs fiscal loosening, not tightening to boost their economy. The fiscal tightening that their previous bailout terms imposed put the economy into a depression, and undid any benefit of reduced spending. Because the GDP shrunk, the debt load became less sustainable, not more.

 

[norseamd]

Don't promise what you cannot pay.

Never lend when you know you might not get it back.

 

[DucatiMonster696]

Let's put some things into context.
Greece ran a budget surplus last year of $2B, or 1% of GDP. In the middle of the equivalent of a Great Depression, with 25%+ unemployment, and 50% youth unemployment. US could barely manage to balance the budget during the boom years of the Clinton administration. The issue is that Greece's debt load from the past is unsustainable, not that its current fiscal policy is too loose. Greece needs its past debts restructured and written off, and it needs fiscal loosening, not tightening to boost their economy. The fiscal tightening that their previous bailout terms imposed put the economy into a depression, and undid any benefit of reduced spending. Because the GDP shrunk, the debt load became less sustainable, not more.

The surplus you are mentioning came a from a combination of a reduction of spending, increase tax enforcement/collection and bond sales on Greece's debt via Greek debt bonds which were done on their behalf. However your suggestions would essentially erode that surplus which they were able to obtain via the aforementioned austerity based policies and would set Greece on the same path of fiscal endangerment that created this mess in the first place. Which is fine and dandy if Greece was on its own because they would only screw themselves over in the end.

However they are not and they are part of the EU. Which means that this is not only Greece's problem but a huge problem for the other EU member states. Nevermind that Greece still wants to be part of the club which means it has to adhere to the rules set in place to keep the EU economically solvent as a union of independent European states linked via a common currency and a set of common economic policies to keep that currency afloat.