Open Letter from Syriza Leader to German People

Generali

Now translated into English

http://syriza.net.gr/index.php/en/pressroom/253-open-letter-to-the-german-readers-that-which-you-were-never-told-about-greece

It's an interesting read. I can't imagine it went down too well in Berlin but it is factually accurate IMHO:

In 2010, the Greek state ceased to be able to service its debt. Unfortunately, European officials decided to pretend that this problem could be overcome by means of the largest loan in history on condition of fiscal austerity that would, with mathematical precision, shrink the national income from which both new and old loans must be paid. An insolvency problem was thus dealt with as if it were a case of illiquidity.

In other words, Europe adopted the tactics of the least reputable bankers who refuse to acknowledge bad loans, preferring to grant new ones to the insolvent entity so as to pretend that the original loan is performing while extending the bankruptcy into the future. Nothing more than common sense was required to see that the application of the 'extend and pretend' tactic would lead my country to a tragic state. That instead of Greece's stabilization, Europe was creating the circumstances for a self-reinforcing crisis that undermines the foundations of Europe itself.

padington

Great move by the Greek PM. Would be interesting to Merkel respond.

Generali

padington wrote: »

Great move by the Greek PM. Would be interesting to Merkel respond.

Well this is what investors in Greece thought of the news:



:eek:

There's a huge buying opportunity for the brave/opportunity to lose money for the stupid.

ruggedtoast

Merkel's problem is that Germany has no moral authority to impose anything on any other EU country.

Meanwhile the Franco side of the Franco German motor, which was meant to lend legitimacy to Europe's leaders, has conked out, and is in no position to criticise Greece.

Tsipras is calling Merkel's bluff and he will win. He will win because rightly or wrongly everyone will line up behind Greece rather than see them appear to be bullied out of Europe by Germany. As they apparently won't go voluntarily Merkel is going to have to bend over and get her cheque book out. Which is, sadly for Germany, a country I really like, all its European neighbours want from it in the end.

Thrugelmir

ruggedtoast wrote: »

Merkel's problem is that Germany has no moral authority to impose anything on any other EU country.

Carneys words last night is the reality that many people have been saying for years.

Mr Carney said sharing a currency without also sharing decisions on taxes and spending did not work.

"For complete solutions to current and potential future problems the sharing of fiscal risks is required," he told an audience in Dublin, Ireland.

Currently, EU members share the euro currency, but decisions on spending are made at a national level.

Mr Carney said "it is no coincidence" that effective currency unions tended to have centralised fiscal authorities.

"European monetary union will not be complete until it builds mechanisms to share fiscal sovereignty," he said.

He said the current system in the eurozone made it stand out from federal countries like the US, Canada and Germany, where a central government has the ability to transfer significant financial resources to constituent states as-and-when those states run into severe difficulties.

"Without this risk sharing, the euro area finds itself in an odd position," he added.

http://www.bbc.co.uk/news/business-31030425

michaels

Germany's economic success of late has been very much driven by a much lower exchange rate than would have been the case had it not tied its currency to the countries it now berates. A case of trying to have ones cakes and eat it.

ruggedtoast

Greece should never have been admitted. They did exactly as a Euro member as they did outside the Eurozone. Not by any stretch of the imagination did they meet the entry criteria so Germany needs to take some deal of responsibility.

CLAPTON

The majority of the Euro countries shouldn't have been admitted.


Not exactly a solution, mind you although it does suggest one.

antrobus

ruggedtoast wrote: »

Merkel's problem is that Germany has no moral authority to impose anything on any other EU country.

Meanwhile the Franco side of the Franco German motor, which was meant to lend legitimacy to Europe's leaders, has conked out, and is in no position to criticise Greece.

Tsipras is calling Merkel's bluff and he will win. He will win because rightly or wrongly everyone will line up behind Greece rather than see them appear to be bullied out of Europe by Germany. As they apparently won't go voluntarily Merkel is going to have to bend over and get her cheque book out. Which is, sadly for Germany, a country I really like, all its European neighbours want from it in the end.

The Netherlands has added its voice to that of Germany and France in insisting that Greece stick to its previous commitments.

http://www.bbc.co.uk/news/world-europe-31016261

antrobus

CLAPTON wrote: »

The majority of the Euro countries shouldn't have been admitted.

Not exactly a solution, mind you although it does suggest one.

Strictly speaking, had the rules actually been applied from Day One, then I don't think a single one of 'em should have been admitted.

And yes, maybe it does suggest that Germany should consider returning to the DM.

stator

The greek people weren't forced to accept the bail out. They could have defaulted on their loans at the time. They now have the choice of defaulting and leaving the eurozone or sticking with the current plan. I do wish they would stop moaning about it though. Pretending they were forced into anything is a lie. They took their choices before and have to live with the consequences.