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On now, "This World" on Greece.
Comments
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No, it's a question for the Germans. When you make a deal, you're supposed to understand what the other side thinks it's going to get.For that you'd need political union and a new treaty. That ain't gonna happen sometime soon.
They thought they could do that because they thought they were borrowing against the Germans' credit. So did the people who bought the bonds at low yields, and so did the ratings agencies, and so did the ECB. And everybody knew what they all believed, and nobody put them straight. Even the speculators took years to realise that they could short eurozone government stocks with impunity, because it's just so unbelievably silly that this could be true.In the case of Greece, it seems it gave them the opportunity to borrow loads and loads of money to p!ss away.
Who knew that the Germans had failed to take on board the unavoidable implications of what they'd got themselves into? Everybody else could see that eurozone countries can't manage their own debts without their own monetary policies, how were they to know it wasn't obvious to the Germans?"It will take, five, 10, 15 years to get back to where we need to be. But it's no longer the individual banks that are in the wrong, it's the banking industry as a whole." - Steven Cooper, head of personal and business banking at Barclays, talking to Martin Lewis0 -
HAMISH_MCTAVISH wrote: »
How do you fix a poverty crisis by impoverishing more people?
Lend them some more money, thats bound to fix it.0 -
They thought they could do that because they thought they were borrowing against the Germans' credit. So did the people who bought the bonds at low yields, and so did the ratings agencies, and so did the ECB. And everybody knew what they all believed, and nobody put them straight. Even the speculators took years to realise that they could short eurozone government stocks with impunity, because it's just so unbelievably silly that this could be true.
?
So loads of people were wrong.
Bet on the wrong horse and you lose your money.
Borrow the money to place the bet with and you are a fool.
Just don't expect others to pay for your mistakes.0 -
If the point of leaving the euro is to print money because the country has no credit, then the money will be wallpaper and the exercise will be self-defeating. Nowadays, currency is backed by credit, whichever currency it is.
The only way to sort Greece is for its friends to extend it enough cheap credit while it gets its act together. If it hasn't got any friends, playing games with the currency won't help. Only Oxfam will help.
There is no realistic hope for Greece to pay back what remains of its debts in euros while the austerity programme is shrinking it's economy.
The euro is the DMark in all but name and Germany is controlling that currency to their own advantage, using the reason that they need to preserve their currency's strength to afford the bailouts that come with terms and conditions that will continue to throttle Greece.
An Argentina style default is Greece's least worse option. They cannot keep going through year after year of misery with real wages falling each time until they will default anyway and there will be no more bailouts.
After that Greece will need an EU Marshall plan, not more EU austerity.0 -
Yes. But it's now looking worse for Europe than for Greece. In the first place, helping the Greeks keep the short-sellers at bay and the bond issues rolling over should have been a small fly for the might of Europe to swat. Converting it into this sort of mess is a shocking indictment of the way Europe is run.ruggedtoast wrote: »An Argentina style default is Greece's least worse option.
If Europe can dig itself out of this hole and end up with anything that can be passed off as a successful rescue, it might hang on to a smidgeon of credibility. But if the Greek job collapses now, the EU will have no credibility at all. It will be a laughing stock. And this can only wreck what's left of the credit of half of Europe."It will take, five, 10, 15 years to get back to where we need to be. But it's no longer the individual banks that are in the wrong, it's the banking industry as a whole." - Steven Cooper, head of personal and business banking at Barclays, talking to Martin Lewis0 -
HAMISH_MCTAVISH wrote: »Exactly what's happening.
The Greek budget deficit rose 52% between Q1 2011 and Q1 2012, because austerity is crippling the economy, reducing tax income, and increasing welfare costs.
NGO's are proclaiming the results of this a "humanitarian disaster", and we're now seeing food and medical aid programmes being set up in a modern European country instead of in Africa.
And of course a neo-nazi party, complete with Swastika-like flag and raised arm salutes, has just been elected to 21 seats in the Greek parliament.
Whatever the solution is, this isn't it....
I think I phrased myself badly. My point was, where do you think that the extra money you would have the Greek Government spend come from?
I agree that what is going on in Greece and elsewhere is bad. However, I really don't see a simple solution that will be palatable to the middle classes of Europe.
The simple solution is to declare the system to be bankrupt, wipe out all the debts and start again. Unfortunately all those bourgeois people with savings would get jolly upset so instead we reduce the poorest people in countries across Europe to starvation and ill health.0 -
Will be interesting to see what happens if they cannot form a govt and have to go to the polls again next month. With the far left and far right having both gained a bit of traction in the last election, there is potential for other voters to start to view them with credibility. Could get nasty. Or of course the electorate could get cold feet and realise that protest voting for extremists is going a bit wrong and might end up with them actually getting serious power.0
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Jennifer_Jane wrote: »Did anyone notice the car factory in Germany where all the workers were wearing the same jolly red dungarees? I can just see that happening in the UK....
Honda, Nissan, Toyota to name a few.......;)0 -
ruggedtoast wrote: »The euro is the DMark in all but name and Germany is controlling that currency to their own advantage, using the reason that they need to preserve their currency's strength to afford the bailouts that come with terms and conditions that will continue to throttle Greece.
Germany is still dealing with the effects of unification. Even now some 20 years after the fall of the Berlin Wall.
The old East Germany was extremely poor. I went to Dresden a lot around 2001. Even then West Germans were spat at in the street as they stood from the crowd.
The issues that face Greece are going to take a long to resolve. The Greek people themselves have to mutually agree in majority at least. To move forward and rebuild the country.
In many ways the consumer boom in Greece on the back of cheap money and high levels of Government expenditure. Bear similar resemblances to the UK. Although our economy is much stronger.0 -
Looks like the markets are being 'softened up' for Greece to fall out the Euro - Europe central bankers have been openly expressing views on the possibility of Greece leaving the eurozone
Once the facade of all-for-one breaks, the markets will send Greek bonds through the roof and the EU pen-pushers can't risk the contagion spreading to Spain0
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