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Old 06-29-2015, 08:49 PM   #161
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And the Greeks' reluctance to sign on for more of the bitter medicine is being portrayed as wanting to live high on the hog on German money.
?? The Greeks want these to be two separate issues (living within their means and getting more loaned money). Well, of course they do. And they've found entities willing to let them separate those issues. But now that the music apparently has stopped, who should they really be mad at?
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Old 06-29-2015, 08:53 PM   #162
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No there are some cultural stereotypes at work, making it sound like the Greeks haven't sacrificed, because they're slippery people.
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Old 06-29-2015, 09:12 PM   #163
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I think the EU has said that they are not trying to cut pensions, just to stop the early retirements.

According to the WSJ, pension spending has fallen 13%: Greeceís Pension System Isnít That Generous After All - Real Time Brussels - WSJ

The current Greek government says to vote them to stay and they will continue negotiations to get more favorable terms. The EU troika and Germans and French heads of state say this is a vote on staying in the Eurozone. If we believe them, there is no new negotiations possible.

If I were a Greek, I would not believe that negotiations can be restarted with the current Greek government. It appears that if the current government is kept in power, their will be no money for the pensioners. So pensioners will be totally destitute.
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Old 06-29-2015, 09:20 PM   #164
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I think the EU has said that they are not trying to cut pensions, just to stop the early retirements.

According to the WSJ, pension spending has fallen 13%: Greeceís Pension System Isnít That Generous After All - Real Time Brussels - WSJ

The current Greek government says to vote them to stay and they will continue negotiations to get more favorable terms. The EU troika and Germans and French heads of state say this is a vote on staying in the Eurozone. If we believe them, there is no new negotiations possible.

If I were a Greek, I would not believe that negotiations can be restarted with the current Greek government. It appears that if the current government is kept in power, their will be no money for the pensioners. So pensioners will be totally destitute.

Actually reading the various articles on the negotiations, they were trying to cut the pensions... IIRC it was by more than $200 per month...

Greek pensions as a % of spending is much higher than any other EU country and they said it had to be cut... not just raising retirement age...
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Old 06-29-2015, 09:28 PM   #165
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The current Greek government says to vote them to stay and they will continue negotiations to get more favorable terms. The EU troika and Germans and French heads of state say this is a vote on staying in the Eurozone. If we believe them, there is no new negotiations possible.
.
I don't read it this way. If the Greek people agree to accept the EU/ECB/IMF reforms, the current Greek government has said they will accept that decision but will take no part in implementing it. From the BBC:
Quote:
Mr Tsipras hinted strongly that he would resign if the result of the referendum was a "yes" vote
"If the Greek people want to proceed with austerity plans in perpetuity, which will leave us unable to lift our head... we will respect it, but we will not be the ones to carry it out," he said.
I think that means they will step down/call for new elections. If the Socialist government wins the most seats and a mandate, I'd say the situation continues to spiral down unless/until they accept reforms. Actually, with or without the additional loans/eased repayment offered by creditors, Greece won't have a viable economy unless reforms are made--now or later.
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Old 06-29-2015, 09:33 PM   #166
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I think the EU has said that they are not trying to cut pensions, just to stop the early retirements.

According to the WSJ, pension spending has fallen 13%: Greece’s Pension System Isn’t That Generous After All - Real Time Brussels - WSJ...
The above article is dated 2012, and not up-to-date.

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Actually reading the various articles on the negotiations, they were trying to cut the pensions... IIRC it was by more than $200 per month...
Yes to both: More pension cuts on top of the 44%+ already instituted since 2009, and raise retirement age to 67. Also, no more early retirement at full benefits for hazardous jobs.

See this article dated June 4, 2015: Q&A: Greek pensions -- deal or no deal - FT.com.
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Old 06-29-2015, 09:35 PM   #167
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Actually reading the various articles on the negotiations, they were trying to cut the pensions... IIRC it was by more than $200 per month...

Greek pensions as a % of spending is much higher than any other EU country and they said it had to be cut... not just raising retirement age...
What I have read in a few sources is:
Quote:
Greeceís creditors are demanding the government cut pensions by the equivalent of 1% of gross domestic output
see: Unsustainable futures? The Greek pensions dilemma explained | Business | The Guardian

But the pension situation is very complicated. It is not clear (to me at least) that the lowest paid pensioners would be reduced further. Reading about the pension problems in detail can put one to sleep ... hard for me to focus on all the moving parts.
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Old 06-29-2015, 09:52 PM   #168
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The above article is dated 2012, and not up-to-date.
Actually it's from Feb 2015.
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Old 06-29-2015, 09:54 PM   #169
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This article says several preliminary polls indicate the Greek public may be inclined to accept the conditions that the EU put on the table.

Of course, when that offer was made, Greece wasn't in default. But I'd bet the EU/IMF/ECB would offer the relief if the Greek government actually agreed to implement the suggested reforms. Then we'll all get to see if they actually do it--I would bet against that.
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Old 06-29-2015, 09:59 PM   #170
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The 1% of GDP cut does not sound so bad, as pensions now cost 17.5% of GDP, so that 1% is 6% cut.

However, the article says that there are 400,000 pension applications in backlog, which will be added to the existing 2.65M pensioners. So, cutting the smaller pie into more pieces gives a cut of 18%.

And that 18% is on top of the 44% cut since 2009. That 18% seems online with the 200-euro cut mentioned elsewhere.

By the way, the 3.05M retirees represent 27.5% of the Greece population of 11.12 million in 2015. And that population includes minors who cannot work. So, what is the ratio of retirees over active workers? Bleak!
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Old 06-29-2015, 10:00 PM   #171
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Guess it would be like China, which owns our debt, saying social security eligibility age will be raised and the payouts will be about half of what you were going to get.
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Old 06-29-2015, 10:04 PM   #172
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Guess it would be like China, which owns our debt, saying social security eligibility age will be raised and the payouts will be about half of what you were going to get.
Not at all. It would be like China saying "reform SS or we won't loan you any more money." And we'd be free to accept or decline--just like Greece.
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Old 06-29-2015, 10:05 PM   #173
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For new debts, maybe they will want it in some other currencies.

But for interest paid on existing debt, well, they own our bonds which are in US dollars which we can just print more. Problem solved.

However, inflation will hurt retirees like the dickens. And the dollar will be so low, foreign travel will be something one reminisces with tears in his/her eyes.
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Old 06-29-2015, 11:04 PM   #174
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Guess it would be like China, which owns our debt, saying social security eligibility age will be raised and the payouts will be about half of what you were going to get.
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Not at all. It would be like China saying "reform SS or we won't loan you any more money." And we'd be free to accept or decline--just like Greece.
Not only that, but we are paying the interest payments on time, correct? And is there any serious doubt that they will get their face value back at the end of the term?

So I don't think China (or any other bond buyer) has a word to say about how we handle our other finances.

You seem to really be stretching for others to throw money at Greece, why is that? For the record, there aren't many who want to see the people of Greece suffer, but when the can has been kicked down the road for so long, something has to give. Just throwing money at them may make for more suffering in the long run. I don't want that.

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Old 06-29-2015, 11:36 PM   #175
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Folks just don't understand. Its our duty to lend money to Greece forever. They don't want a gift of money, just continuous lending forever ! That way they can keep their dignity.

Ok, sure I was not serious, but I'm serious when I say Greece should default.

Stop importing everything, and be self sufficient in their needs. If Any Greek finds the country is missing something, he can start building/growing/making it and supply it to the rest of his/her country persons.

There is freedom in being debt free
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Old 06-29-2015, 11:43 PM   #176
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I don't own bonds (have a couple years expenses in cash) but I do own heavily covered call dividend stocks.

If it just stagnates within 1000 points of this level I come out pretty well on their Jan 2016 expiration while I collect the 2% to 4% dividends.

The temptation will be to invest some of our cash. It has been very hard keeping $100,000 out of the market...

At DOW 12,000 it might become irresistible.
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Old 06-29-2015, 11:53 PM   #177
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I have a lot more than $100K in cash, several times that in fact. But will I be able to go all in? I was not able to in 2008-2009, so will not talk tough now. Some of the cash is in I-bonds, which I do not want to part with anyway. But a couple of 100G's is doable, if and when it feels right.
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Old 06-30-2015, 12:01 AM   #178
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Come to think of it, say the market drops 10% or 20%. You plunk down $100K, then the marker recovers. So, you get a gain of $10K or $20K. It surely is nice to have any extra money, but is it a life-changing amount, or just for a really nice foreign vacation?

To really have it good, you've got to put down 5x or 10x that amount. That means you have to sell high to raise a lot of cash when the market is high. That's not easy to do.

The time when the market dropped 50% like in 2003 and 2009 was really the time to make a killing. And I was too afraid to go all in.
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Old 06-30-2015, 12:03 AM   #179
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Old 06-30-2015, 12:08 AM   #180
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Oh, I forgot about I-bonds. We have 30k of those which are paying a generous 0.0%. I could definitely afford the 0% penalty to convert those to stock if offered a great deal.

We are also selling our house this year and doing what you only speculate, NW...boondocking on gubmit land for near free. That house sale will be all cash since there is no loan.

I had been trying to figure out what to do with the money while the stock market was in the 18,200s and not a lot of bargains. This GrecoRican event might be just the ticket to better bargains.
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