Greece's brutal austerity measures

[Oric]

Goldman Sachs helped a corrupt government to misrepresent the financial condition of Greece to get them into the EU, IIRC. This had costs; the wrongdoers profited.

That was more of a political decision. Did the EU superpowers Germany and France not know the facts ? Hardly so. They just wanted to make sure that Eastern Europe including Greece should be included into the union before Russia and (future) Turkey would increase their economical sphere in the region. Today Bulgaria and Romania are in a deeper mess than Greece, almost all their workable population left the motherlands. Bulgarian population decreased 1.5 million, 34% of the remaining population are pensioners and they recieve less European subsidies and programmes then their membership fees. Only that they are not in Eurozone you do not hear about their condition.

To summarize Goldman Sachs and others cooked the books in accordance with what EU government. We will hear about these probably in the next decade ...

 

[freegeeks]

Quite a lot of the TARP money went to European banks.

We bought their toxic securities. And I don't think we should have. If European banks wanna invest, then they are responsible for their investment decisions.

If the Euro banks believe they were mislead by Moody's or whomever, then sue Moody's.

I do not like, or approve of the model whereby if/when Euro banks invest in US securities and get a profit they keep it, but if there's a loss the US taxpayer reimburses them. Just more of the whole "privatized profits, socialized losses".

Fern

a lot of that tarp money was going to European banks holdings CDS that all of the sudden became worthless. AIG sold tens of billions of worthless insurance, I'm glad that billions of US tax money when to European banks holding that worthless insurance that American financial institutions sold to other banks all over the world. You sold crap, you should pay for it...

 

[Darwin333]

a lot of that tarp money was going to European banks holdings CDS that all of the sudden became worthless. AIG sold tens of billions of worthless insurance, I'm glad that billions of US tax money when to European banks holding that worthless insurance that American financial institutions sold to other banks all over the world. You sold crap, you should pay for it...

The US didn't sell "crap" companies that are based in the US sold "crap". They should have paid for it and if they couldn't pay for it they should have went bankrupt.

If I purchase a car that was made in Germany and it turns out to be a lemon do the people of Germany owe me a new car or does the company that sold it to me owe me a new car?

How about all the financial turmoil that the Greek governments accounting scams are causing? Do the Greeks owe everyone who has lost money due to their countries lying?

 

[shira]

That would be so cool. When the Greeks start to die of starvation we can move our jobs there from China. There's no motivator like hunger to get you to work for beans.

And if we can get child labor laws rescinded, we can really do things right. Children don't need nearly as many beans as adults.

 

[freegeeks]

The US didn't sell "crap" companies that are based in the US sold "crap". They should have paid for it and if they couldn't pay for it they should have went bankrupt.

If I purchase a car that was made in Germany and it turns out to be a lemon do the people of Germany owe me a new car or does the company that sold it to me owe me a new car?

How about all the financial turmoil that the Greek governments accounting scams are causing? Do the Greeks owe everyone who has lost money due to their countries lying?

well it's like the German finance minister said to Geitner, we don't have any lessons to learn from a country that has a public debt exceeding 100% of GDP, a deficit double of the Eurozone and a giant trade deficit. In fact if the USA would have been in Europe, it would have been one of the PIGS for sure

 

[Taejin]

Don't try to explain here, the whole CDO/CDS mess that has cost trillions all over the world was apparantly not caused by Joe Sixpack and his AAA-repackaged-by-Wall-Street-NINJA loan but was caused by European banks choosing to "expose" themselves to the USA market. You just have to look at the savings quotes of the last 20 years of Joe Sixpack to know what's going on, just one giant debt bubble exported to other countries.

fwiw i also agree its our fault. of course if you really wanted to point fingers you could just look at the republicans always crying for deregulation..

well here's your fucking deregulation you nitwits

 

[Taejin]

He meant in general. Obviously not all Greeks are lazy. Just a lot of them.

honestly I don't think its not something you can totally attribute to 'being Greek'. Although I'm sure some problems are rooted in culture, its most probably a political problem. It doesn't take very much for a country to start off on the wrong path and then continue with their insanity until everything blows up.

 

[soccerballtux]

Michael Pettis wrote about the best solution I've seen yet, Germany and the other Euro-using countries with sound economies leave the Euro and form a new currency.
This shields PIIGS from the inevitable explosive inflation if they went back to their own currency, and buffers the euro revaluation until Greece et al are once again competitive exporters.

These austerity measures are doomed to fail. The above is one of the only real options available, but people would freak and it might be painful at the start so. . . I guarantee it won't happen.

The first half of his thoughts you can read here, but not the 2nd half...he's a journalist for a Chinese investment periodical and part of his contract requires he restrict full access to his writings...
http://mpettis.com/2011/09/the-euro-once-again/

The best of what he has to say is in the first half though so you're not missing too much, he discussing other things in the other half.

 

[Craig234]

That was more of a political decision. Did the EU superpowers Germany and France not know the facts ? Hardly so. They just wanted to make sure that Eastern Europe including Greece should be included into the union before Russia and (future) Turkey would increase their economical sphere in the region. Today Bulgaria and Romania are in a deeper mess than Greece, almost all their workable population left the motherlands. Bulgarian population decreased 1.5 million, 34% of the remaining population are pensioners and they recieve less European subsidies and programmes then their membership fees. Only that they are not in Eurozone you do not hear about their condition.

To summarize Goldman Sachs and others cooked the books in accordance with what EU government. We will hear about these probably in the next decade ...

Thanks for the comment. I don't know the issue well enough to agree or disagree. Your assertion is plausible. You have a different set of information, being in Turkey.

Of course it doesn't change the corrupt role of Goldman Sachs; it merely adds another corruption to the story.

 

[Craig234]

Michael Pettis wrote about the best solution I've seen yet, Germany and the other Euro-using countries with sound economies leave the Euro and form a new currency.
This shields PIIGS from the inevitable explosive inflation if they went back to their own currency, and buffers the euro revaluation until Greece et al are once again competitive exporters.

These austerity measures are doomed to fail. The above is one of the only real options available, but people would freak and it might be painful at the start so. . . I guarantee it won't happen.

The first half of his thoughts you can read here, but not the 2nd half...he's a journalist for a Chinese investment periodical and part of his contract requires he restrict full access to his writings...
http://mpettis.com/2011/09/the-euro-once-again/

The best of what he has to say is in the first half though so you're not missing too much, he discussing other things in the other half.

Hey, how about another solution, where a new currency in the US is made only for the wealthy to use that's rock solid, while America's debt is inflated away costing all the average Americans what they have? Pretty neat plan for the next steps in transferring wealth to the top.

 

[Craig234]

nm, dark humor retracted to a PM.

 

[momeNt]

Hey, how about another solution, where a new currency in the US is made only for the wealthy to use that's rock solid, while America's debt is inflated away costing all the average Americans what they have? Pretty neat plan for the next steps in transferring wealth to the top.

Sounds like somebody is nearing adopting a new view on the economics of money. You go craig!

 

[Doppel]

Germany and the other Euro-using countries with sound economies leave the Euro and form a new currency.

Seems myopic. It's saying "let the crap countries leave and the strong stay with the one currency", but even among the strong some are stronger, so the potential for the same problem exists. If the Uk, for example, was part of the Euro I understand its debt problems worse than Germany, so down the road we could end up with the same thing.

There is an inherent problem to this that many pundits have spoken long about which is simply you cannot have essentially independent sovereign nations with their own political systems and budgets sharing a currency and trying to share control of it. If that's the case, and it has been so far, they should either not share a currency or, if they do, they must merge politically to become one.

 

[soccerballtux]

Hey, how about another solution, where a new currency in the US is made only for the wealthy to use that's rock solid, while America's debt is inflated away costing all the average Americans what they have? Pretty neat plan for the next steps in transferring wealth to the top.

Lol you don't seem to understand (must not have read the article) that Greece's indebtedness is a direct result of the strength of the euro, do you??? They can't compete on exports and are forced to run trade deficits. This is what is causing their massive levels of unemployment.

It's impossible to have a unified currency without unified fiscal policy. That's why the euro was doomed from the start. The strength of the German economy is what is forcing the Greeks into debt. This must be blowing your mind right now but if you had a clue you'd know it's macro-econ101 in action. The truth is right in front of everyone plain to see. Why do you choose to stick your head in the sand?

 

[werepossum]

Lol you don't seem to understand (must not have read the article) that Greece's indebtedness is a direct result of the strength of the euro, do you??? They can't compete on exports and are forced to run trade deficits. This is what is causing their massive levels of unemployment.

It's impossible to have a unified currency without unified fiscal policy. That's why the euro was doomed from the start. The strength of the German economy is what is forcing the Greeks into debt. This must be blowing your mind right now but if you had a clue you'd know it's macro-econ101 in action. The truth is right in front of everyone plain to see. Why do you choose to stick your head in the sand?

This, in spades. It's like California thinking it could deregulate wholesale electricity while continuing to regulate retail electricity; it might work for a while, but sooner or later it's going to bit you on the ass and not let go.

 

[Macamus Prime]

Interesting read; http://www.investmentnews.com/article/20110925/REG/309259988