Greece...

Graham_Devon

Seems a Greek default and exit from the EU is now officially on the cards.

It's currently more a threat than anything else, but it's coming from officials, which I don't think has happened before.

The Greek government does not have the money to repay the IMF loan on 30th June. The IMF has already been giving further loans to Greece in order for Greece to pay the interest on IMF loans.

So now, the attention moves back to the EU and the IMF.

Will they paper over the cracks again giving another couple of months until crunch time again? If they do, do they accept that they are lending money to a country which can never repay it? Do they accept that ultimately, they are creating a worse fall out further down the line?

Or are we finally going to see a conclusion?

On another note, thousands of anti austeriy protestors took to the streets for the first time since the new government was drafted in to protest against further austerity. It appears the overarching feeling now isn't "we need more money". Rather it appears they now support a Euro exit if it stops the humiliation.

mwpt

Not sure if this has been posted before, but Varoufakis gives a pretty good explanation of the situation (from about 12:30 in). My leaning is toward frugality and I don't agree with high public spending that cannot be paid for, but even I have to admit that at the moment there is just a bunch of finger pointing and gamesmanship going on.

http://livestream.com/accounts/10217920/events/4090605

chucknorris

purch wrote: »

The problem with trackers is that they track both UP & DOWN

At the moment I am quite happy that it has been tracking both up and down, the recent volatility has been great. That might change of course, life doesn't come with any guarantees.

antrobus

Graham_Devon wrote: »

....On another note, thousands of anti austeriy protestors took to the streets for the first time since the new government was drafted in to protest against further austerity....

On a point of order.

That would not be the first time that anti-auterity protestors have taken to the streets since Syriza came to office.

kabayiri

http://www.bbc.co.uk/news/business-33177021

Way to go Zoe !

I rather suspected people lending money to others were basically evil people, intent on bringing chaos and destruction

It's just lucky they don't have to deal with evil money lenders again....hang on, err, wait...

mwpt

kabayiri wrote: »

http://www.bbc.co.uk/news/business-33177021

Way to go Zoe !

Without meaning to sound like I'm standing against Greece, would someone mind explaining how debt relief is viewed as immoral?

My understanding might be patchy but:
- Greece borrowed on the free market and their creditors were X and Y
- They came into difficulties repaying X and Y, and may have had to default on these bonds
- They negotiated a deal for debt relief at LOWER interest rates in order not to default on the original bonds, shifting their creditors from X and Y to E and I.
- Now the narrative is to blame the parties who offered the lower interest rates?
- If Greece had defaulted on the original debt, at higher interest rates, would they not have been in just as dire a situation?

Seems to me that saying the original bailout money went to Greece's original creditors isn't such a shock. It is exactly where I'd expect it to go.

But again, I'm not picking sides here, just trying to understand the various narratives.

antrobus

mwpt wrote: »

Without meaning to sound like I'm standing against Greece, would someone mind explaining how debt relief is viewed as immoral?

My understanding might be patchy but:
- Greece borrowed on the free market and their creditors were X and Y
- They came into difficulties repaying X and Y, and may have had to default on these bonds
- They negotiated a deal for debt relief at LOWER interest rates in order not to default on the original bonds, shifting their creditors from X and Y to E and I. ....

And in order to remain within the Eurozone.

mwpt wrote: »

...- Now the narrative is to blame the parties who offered the lower interest rates?....

Well, yes, but that's nothing new is it? It's quite common for borrowers who experience issues with repayment to blame their lenders for their predicament.

mwpt wrote: »

...- If Greece had defaulted on the original debt, at higher interest rates, would they not have been in just as dire a situation?.....

Pretty much. If you have a government running a deficit of 15% of GDP and you default, then you have no choice other than to immediately cut the deficit to 0%. Which means the economy is going to crash and burn whatever.

mwpt wrote: »

...Seems to me that saying the original bailout money went to Greece's original creditors isn't such a shock. It is exactly where I'd expect it to go. ....

I think that some of the Greeks are moaning because there wasn't any new bailout money made available. They think that somebody should lend them some more money so they can spend it on boosting the economy.

mwpt wrote: »

..But again, I'm not picking sides here, just trying to understand the various narratives.

Good luck.

kabayiri

mwpt wrote: »

Without meaning to sound like I'm standing against Greece, would someone mind explaining how debt relief is viewed as immoral?
...

Zoe hasn't a leg to stand on, in my view.

Nobody forced the Greeks to borrow to sustain an unrealistic lifestyle.

Greek chickens are just like other chickens. They come home to roost too.

mwpt

kabayiri wrote: »

Zoe hasn't a leg to stand on, in my view.

Nobody forced the Greeks to borrow to sustain an unrealistic lifestyle.

Greek chickens are just like other chickens. They come home to roost too.

Well, if you watch Varoufakis speech he talks about Germany running a surplus, requiring some other country (Greece in this case) to run a deficit. He makes out as if it was inevitable that Greece would run a deficit if Germany ran a surplus. Which makes sense at some level, but surely he is talking about a trade surplus/deficit?

I would have expected a country could run a trade deficit but still retain a budget surplus through smaller state spending and better tax collection? Am I wrong?

Graham_Devon

Personally I believe both the debtor AND creditor can have some "blame" (for want of a better word) laid on them.

Greece borrowing money is not like us borrowing too much on credit cards. There is far more involved. The EU, the Euro just for a start.

It's unfair to blame Greece (and certainly unfair to blame individual greek citizens) for the loans taken on. There have been numerous threats from the EU should they choose another path.

Greece should be blamed for everything they did before joining the EU etc. They have their issues. But their issues were compounded by their fudged entry into the EU and the dictat from the EU ever since.

If you are a lender and you continually lend to someone who you know is undergoing serious financial issues....who really is to blame? The lenders should know better.

In this case, the important part in all of this isn't Greece, it isn't the debts, it's the face of the EU.

All IMHO.