Greece...

antrobus

michaels wrote: »

Well it is probably like the UK where you can't get paid in cash and can no longer just just go and pick up your benefits/pension in cash at the post office....

I get the distinct impression that Greek pensions are paid on a monthly cycle, based on the regular cycle of meda reports just after the end of every month about Syriza scrabbling around for the money to pay them. I therefore imagine that many Greek pensioners have no alternative other than to wait in eager anticipation for the government to credit their account at the end of the month, before similarly scrabbling to withdraw it.

michaels wrote: »

...Even if the Greeks aren't broke the current dynamic means that the traffic at banks will be all one way. Of course if they had their own currency they could print money if need be to provide liquidity and problem solved.

It would solve the immediate problem of keeping the banks liquid. Although, of course, actually printing money tends to have consequences further down the line.

[Deleted User]

Let's let the experts talk.

From Alasdair Macleod's blog:
http://www.financeandeconomics.org/greeces-referendum/

This coming Sunday Greece will hold its referendum.
The question to be asked is not, as the foreign press initially reported it, about leaving the euro. It is about accepting or rejecting the troika’s bail-out terms.
The Greek government’s finance minister is making this distinction clear to voters in the few days remaining. As if to ram the point home, Greece was reported earlier this week to be considering taking out an injunction at the European Court of Justice to block attempts to expel Greece from the euro on the grounds that there is no mechanism to do so. Well, there is in the Lisbon Treaty, but it needs Greece’s approval, which amounts to the same thing. Indeed, in a blog written over a year ago the then economist Yanis Varoufakis wrote, “In short, the answer to a German ‘Go jump’ can be ‘We shall not jump but we shall stay rock solid within the Eurozone and behind our demand for a debt conference. Just watch us'”. Now that he is finance minister he is ensuring his prediction will come to pass.
[...]

It was easy to deride Varoufakis as the game-theorist turned finance minister wholly out of his depth negotiating with his hard-nosed opposite numbers in the Eurozone. History may judge him instead to have played a poor hand very well indeed.

Alasdair Macleod is an old-fashioned well respected bullion trader, not some random socialist, in case you ask.

[Deleted User]

ggb1979 wrote: »

This people is why you don't vote for socialists, superficially they appear to take care of the little people but what they actually do is destroy whole nations.

Trouble is, the opposite is true as well - in places like the UK and the good ole' US of A, they elect capitalist governments who claim to save nations, but destroy the little people.:(

Keep an eye on the Chancer's emergency budget next week and see if the poor benefit at the expense of the wealthy, or if the living standards of the poor are suppressed while the wealthier receive tax breaks. :whistle:

WR

mwpt

Wild_Rover wrote: »

Trouble is, the opposite is true as well - in places like the UK and the good ole' US of A, they elect capitalist governments who claim to save nations, but destroy the little people.:(

Keep an eye on the Chancer's emergency budget next week and see if the poor benefit at the expense of the wealthy, or if the living standards of the poor are suppressed while the wealthier receive tax breaks. :whistle:

WR

Since we already have progressive taxation and the so called wealthy contribute a far higher portion of tax to the public purse, I'm always curious why we can only ever increase this proportion further? If we sway it slightly the other way, we're trodding on the poor.

EDIT: Btw, I support progressive taxation and believe because of the direction of the world economy, that taxation on super wealthy will have to increase. This isn't an idealogical view, it's a practical one.

[Deleted User]

mwpt wrote: »

Since we already have progressive taxation and the so called wealthy contribute a far higher portion of tax to the public purse, I'm always curious why we can only ever increase this proportion further? If we sway it slightly the other way, we're trodding on the poor.

EDIT: Btw, I support progressive taxation and believe because of the direction of the world economy, that taxation on super wealthy will have to increase. This isn't an idealogical view, it's a practical one.

I'm pretty sure that G.O. will not share your belief next week. As long as "the system" intentionally transfers resources from the already "less well off" to the already "well off", there will be problems.

We constantly hear "but the wealthy already pay more" - as if in some way that's odd. OF COURSE THEY SHOULD PAY MORE - they have more of the country's resources resources to contribute more out of. If as a result of government policy a wealthy couple have a tenner a week less to spend on food, I suspect they'll survive.

Next week's budget will show the "real" Conservative approach, you wait and see. Trouble is, there will be all sorts of keech flying around beforehand, so that when he announces that he is really only going to undermine the poorer and boost the wealthier by a little bit, but not as much as feared, we'll all say, "oh well, that's not too bad then". I think folk forget that while they have been in power before May, they had to get things past the LibDems first as well, useless though they were. These guys now have a majority - their first for nearly 20 years. They WILL make the most of it.

If anyone thinks this budget is going to be good news for the unemployed poor, the employed poor or the disabled, they have NOT been paying attention.

EDIT - to take this back to Greece, a further problem is that despite the cries of "it's not the people's fault", well sometimes it is/was. When the Government tried to put a tax on private swimming pools, only about 300 were duly registered by the owners in Athens. Surprised by that response the Government sent up helicopters to do a survey and gave up at about 16,000. When we were in Greece a couple of years ago, as I said somewhere else, receipts were a rarity and there was usually about a 20% discount if we paid for drinks, meals etc in cash. Clearly, tax was not being paid on that. Having said that, I heard on the news this morning that without some debt RELIEF, Greece would be in severe austerity for the next 20 years. I can't see that as sustainable - I think that civil unrest on a huge scale would be inevitable and the "European Project" would not survive that.

WR

Generali

antrobus wrote: »

I don't think those are restricted, or matter. A DD or transfer simply involves moving money from one Greek bank to another Greek bank. That's not an issue from the point of view of the solvency of the Greek banking system as a whole. It's removing money from the Greek banking system, either by cash, or by moving it to a none Greek bank, that is the issue.

All perfectly true but without an effective central bank to take care of overnight liquidity even interbank transfers within Greece can't be guaranteed to be covered.

The ECB is failing to do its basic job which is to keep fundamentally solvent banks from becoming insolvent during a run. The ECB has stitched up the Greeks quite royally.

Our deputy chief economist was asked in our regular Friday Macro meeting how he'd vote in the referendum if he was Greek. A definite no was his answer.

michaels

Wild_Rover wrote: »

EDIT - to take this back to Greece, a further problem is that despite the cries of "it's not the people's fault", well sometimes it is/was. When the Government tried to put a tax on private swimming pools, only about 300 were duly registered by the owners in Athens. Surprised by that response the Government sent up helicopters to do a survey and gave up at about 16,000. When we were in Greece a couple of years ago, as I said somewhere else, receipts were a rarity and there was usually about a 20% discount if we paid for drinks, meals etc in cash. Clearly, tax was not being paid on that. Having said that, I heard on the news this morning that without some debt RELIEF, Greece would be in severe austerity for the next 20 years. I can't see that as sustainable - I think that civil unrest on a huge scale would be inevitable and the "European Project" would not survive that.

WR

Whilst I agree with you that Greece basically paying about 5% of their GDP to creditors for 20 years is politically impossible, somehow when over the last 20 years they spent an extra 5% over and above what they earned no one complained....

Froggitt

Wild_Rover wrote: »

Keep an eye on the Chancer's emergency budget next week and see if the poor benefit at the expense of the wealthy, or if the living standards of the poor are suppressed while the wealthier receive tax breaks. :whistle:

Maybe the woman on the Benefits programme on C5 yesterday, who has taken £250,000 off the taxpayer in the past 20 years will get a windfall.


Or the bloke who was a chef and gardener and builder, but chose not to do either cos it may involve working evenings or weekend. Any he had cable, two huge LED TVs etc.

antrobus

Generali wrote: »

All perfectly true but without an effective central bank to take care of overnight liquidity even interbank transfers within Greece can't be guaranteed to be covered.

Granted. The longer it goes on, the more likely it is that the mechanism will break down somewhere.

Generali wrote: »

...The ECB is failing to do its basic job which is to keep fundamentally solvent banks from becoming insolvent during a run. The ECB has stitched up the Greeks quite royally.....

Given the capital flight from Greece, I'm not sure that there are any "fundamentally solvent banks" left.

Generali wrote: »

.....Our deputy chief economist was asked in our regular Friday Macro meeting how he'd vote in the referendum if he was Greek. A definite no was his answer.

Default and the drachma might well be a simpler solution.

Generali

antrobus wrote: »

Default and the drachma might well be a simpler solution.

Let us not forget that default needn't mean leaving the Euro. There is still no mechanism for leaving the Euro and any change to the EMU treaty is subject to a veto by any member of the EMU including Greece.