Greece

[Chuckanut]

Bitcoin as the new Greek currency?

[Another Reader]

Licking my chops and gunning for bear....


Between Greece and the Chinese, there should finally be a good sale on equities.

[Fermion]

Quote:

Originally Posted by Another Reader Licking my chops and gunning for bear.... Between Greece and the Chinese, there should finally be a good sale on equities.

Mmmmm, unsure. Seems everybody expects a market drop now, which is usually when it goes up.

[Nemo2]

Quote:

Originally Posted by Fermion Mmmmm, unsure. Seems everybody expects a market drop now, which is usually when it goes up.

Australia has been open for an hour....down around 1.7%.

[Lsbcal]

Quote:

Originally Posted by Fermion Mmmmm, unsure. Seems everybody expects a market drop now, which is usually when it goes up.

Well I expected a "yes" vote from Greece.

Now I expect a market drop followed very shortly by a counter rally before the week is out. I'm not betting a thing on that idea.

[FIREd]

Quote:

Originally Posted by Meadbh It has been pointed out (notably by Margaret Thatcher decades ago) that the common currency was doomed to fail in the absence of central government, which is a nonstarter in Europe. Small economies lose the option of currency devaluation, which can help to get them out of a jam. Better to avoid such eventualities. The Greeks, whose current misfortune is to a large extent their own making, have voted "against austerity". Fine. Let's cut the cord, Greece can return to the drachma, and let things settle where they will. The EU and IMF can write off some of the debt, but let's not spend good money after bad.

+1.

The Greeks have spoken. This is our turn to answer. And I hope that EU leaders will defend their taxpayers' interest with the same vigor and spunk as Tsipras defended the interest of his people. If the credibility of the Euro is to be preserved, then I think that there is no alternative to "Grexit". Even then, this vote shows that the fundamental underpinnings of the Euro were flawed from the start. When their national interest is on the line, people will stop playing by the rules they originally agreed upon. And without firm rules, there cannot be a common currency.

[Running_Man]

Quote:

Originally Posted by FIREd +1. The Greeks have spoken. This is our turn to answer. And I hope that EU leaders will defend their taxpayers' interest with the same vigor and spunk as Tsipras defended the interest of his people. If the credibility of the Euro is to be preserved, then I think that there is no alternative to "Grexit". Even then, this vote shows that the fundamental underpinnings of the Euro were flawed from the start. When their national interest is on the line, people will stop playing by the rules they originally agreed upon. And without firm rules, there cannot be a common currency.

The rules were broken in 2010 when Greece was lent money when they were not eligible in order to save the German banking system. The IMF conceded that it bent its own rules to make Greece's burgeoning debt seem sustainable and that, in retrospect, the country failed on three of its four criteria to qualify for aid. They were bankrupt then, they are bankrupt now and they would still be bankrupt in the future if they accepted the EU proposal, which again is just making rules up on the fly, to protect not the Greek economy but primarily the German economy, as the German economy is viewed as key to holding Europe as a world power.

This is 2 percent of German GDP, 400 million a month in trade. The amount of trade Germany has with Greece is the same percentage as the United States holds with Germany. Bankruptcy merely bring quickly what the IMF would have preferred to drain out over the next 40 years.

So people are ready to jump in with both their cash reserves on a projected 1.5% drop? I realize world finance for the last 6 years has rested on the propping up of stock markets around the world and that declines are no longer allowed by most major countries (see China stating the government will start buying stocks to stop the most recent fall) but really whatever happens this next week is really nothing financially, it is whether or not a third block topples over in the debt domino game and that is going to be months in the making.

A common theme that is occurring is leading governments are losing control of debt manipulation as the levels in some cases are just too high to continue the manipulation.

[samclem]

There should be some DARN good USD prices on Aegean cruises coming. "Just stay together in a group and with the armed security guards when we get to shore. "

[explanade]

Read this on a travel forum:

Quote:

My god-daughter is in Mykonos right now and she says most of the ATMs have run out of money and are closed and the ones that are open have extremely long lineups. All businesses will only let you pay in cash, no credit cards and they are finding prices super high. She said the people are lovely, but desperate and scared. Vueling lost their luggage coming from Barcelona so they were without it for five days. Very small tube of sunscreen: 28 euro, dress you'd pay next to nothing for at home (Australia) 180 euro. They understand why and are sympathetic but they are uni students on a budget so are finding it a bit tricky. Well they are living through history in the making and it is a testament to how my friend's raised their daughter that she is handling it fine, but her two friends, not so much.

[Texas Proud]

Quote:

Originally Posted by FIREd +1. The Greeks have spoken. This is our turn to answer. And I hope that EU leaders will defend their taxpayers' interest with the same vigor and spunk as Tsipras defended the interest of his people. If the credibility of the Euro is to be preserved, then I think that there is no alternative to "Grexit". Even then, this vote shows that the fundamental underpinnings of the Euro were flawed from the start. When their national interest is on the line, people will stop playing by the rules they originally agreed upon. And without firm rules, there cannot be a common currency.

I will throw out a counter argument...

All it shows is that they did not vet Greece properly before they allowed them into the Euro zone.... everybody has agreed that they cooked the books (even the Greeks).... so, without cooked books they would not be in right now....


SO, booting them out of the euro is only fixing the mistake they made in the first place.... not that the euro is flawed.....

[NYEXPAT]

One of my Scottish friends posted this recently:

The European members on the IMF board suppressed the publication of an IMF analysis that the Greek debt was unsustainable, and therefore vindicating Mr. Tsipras that a debt restructure was an essential part of any plan going forward. The report was eventually published because IMF staff leaked it in outrage at the suppression.

What are these mealy mouthed Franco-Prussian technocrats up to?

The cradle of democracy has stood up to the unelected commissars in Brussels and taught them a humbling lesson.

Many Greek public servants are at 60% wages, and youth unemployment is at 50%. Hopefully now all parties will act to stop the continued human suffering, pain and uncertainty.

I thought the EU was there to help. Not to crush and dominate!

[razztazz]

Quote:

I will throw out a counter argument... All it shows is that they did not vet Greece properly before they allowed them into the Euro zone.... everybody has agreed that they cooked the books (even the Greeks).... so, without cooked books they would not be in right now....

When I was in Europe in the early 90's (mostly Germany) the buzz was all about Greece, Portugal, and to a lesser extent, Spain. Most people didn't want them in the club because they were considered economic weaklings and would eventually ruin things for everybody else. This is not a surprise.

[samclem]

Quote:

Originally Posted by NYEXPAT One of my Scottish friends posted this recently: The European members on the IMF board suppressed the publication of an IMF analysis that the Greek debt was unsustainable, and therefore vindicating Mr. Tsipras that a debt restructure was an essential part of any plan going forward.

That's the part everyone keeps quoting. The IMF also said that real reforms of the Greek public sector and spending would need to occur, the types of reforms Tsipras has repeatedly refused to make. Many of these reforms are not extraordinary--they are things like cutting staffs in offices where the "workers" don't come to work anyway.

Quote:

Originally Posted by NYEXPAT I thought the EU was there to help. Not to crush and dominate!

"Help, I'm being crushed by the piles of money I asked for."

The Greeks may soon get a chance to face the world on their own two feet without all this "domination".

Referenda are great. Maybe we'll have referenda in France, Ireland, Germany, Spain, etc. "Citizens, Are you in favor of sending one more euro from your taxes to Greece?". Then the other member states can say "Well, sorry. Our people have spoken. Democracy you know"

[samclem]

Quote:

Originally Posted by Texas Proud SO, booting them out of the euro is only fixing the mistake they made in the first place.... not that the euro is flawed.....

No, the euro remains just as flawed as ever. Greece is just one case, but even if it had legitimately gotten into the eurozone, their deep problems would have still led to this. Each country has its own economic and fiscal policies, and as a result they need independent currencies so they have maximum flexibility to devalue their currencies when needed and so that the market can provide pricing signals. The "problem" solved by a single currency -- floating exchange rates-- was actually a tremendous positive feature that helps prevent the very thing we are seeing today in Greece, and will see again.
The only way the euro will work is if countries give up more control and sovereignty to Brussels--they become more like US states and less like nations. If we look at how the EU leadership is elected, we'll see that this would be a huge move away from local political control. No citizen in Europe votes for the President of the European Council, most probably couldn't name him (Donald Tusk).

[Texas Proud]

Quote:

Originally Posted by samclem No, the euro remains just as flawed as ever. Greece is just one case, but even if it had legitimately gotten into the eurozone, their deep problems would have still led to this. Each country has its own economic and fiscal policies, and as a result they need independent currencies so they have maximum flexibility to devalue their currencies when needed and so that the market can provide pricing signals. The "problem" solved by a single currency -- floating exchange rates-- was actually a tremendous positive feature that helps prevent the very thing we are seeing today in Greece, and will see again. The only way the euro will work is if countries give up more control and sovereignty to Brussels--they become more like US states and less like nations. If we look at how the EU leadership is elected, we'll see that this would be a huge move away from local political control. No citizen in Europe votes for the President of the European Council, most probably couldn't name him (Donald Tusk).

Actually they would not have the same problem... first, there would be no way to get to as much debt as they have... it would be impossible...

At the heart of the accord are the fiscal requirements that were laid down in the treaty that led to the creation of the euro as a common currency 20 years ago; it called for the euro zone countries to limit budget deficits to no more than 3 percent of gross domestic product and to restrain overall debt so that it remains below 60 percent of annual economic output.

Greece was running 10% to 12% deficits and has what... a 180% overall debt ratio... if they had followed the rules, they would have made the necessary changes many years ago....



I do agree that the euro is flawed... but it is that there really is no way to stop a country from cheating on the rules...


And I still disagree that the US would be bailing out a state like people think should happen to Greece... as I said before, Illinois is in need of a bailout... I do not see it happening.... I remember way back when NYC was bailed out, but they were given loans and they paid it back...

[Fred123]

Interesting take on the Greek crisis from Thomas Piketty here:

https://medium.com/@gavinschalliol/t...d-7b5e7add6fff

One choice quote:

What struck me while I was writing is that Germany is really the single best example of a country that, throughout its history, has never repaid its external debt. Neither after the First nor the Second World War. However, it has frequently made other nations pay up, such as after the Franco-Prussian War of 1870, when it demanded massive reparations from France and indeed received them. The French state suffered for decades under this debt. The history of public debt is full of irony. It rarely follows our ideas of order and justice.


Sent from my iPhone using Early Retirement Forum

[Calgary_Girl]

So what happens now? The markets should be interesting this week.


http://www.bloombergview.com/article...f-greece-s-no-


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[Texas Proud]

Quote:

Originally Posted by Fred123 Interesting take on the Greek crisis from Thomas Piketty here: https://medium.com/@gavinschalliol/t...d-7b5e7add6fff One choice quote: What struck me while I was writing is that Germany is really the single best example of a country that, throughout its history, has never repaid its external debt. Neither after the First nor the Second World War. However, it has frequently made other nations pay up, such as after the Franco-Prussian War of 1870, when it demanded massive reparations from France and indeed received them. The French state suffered for decades under this debt. The history of public debt is full of irony. It rarely follows our ideas of order and justice. Sent from my iPhone using Early Retirement Forum

I was reading the interview and it sounds like a bunch of malarkey.... he said they are charging high interest rates... but they are much lower than Greece could get on the open market if they could actually get loans on the open market...

I might agree more on the debt forgiveness if it were due to a war like the German debt (no mention of any other debt they did not pay).... but Greek debt is due to inefficiencies and corruption in their system.... why should they be rewarded for that As long as Greece is not willing to fix their internal problems, I doubt people are going to be willing to give them a helping hand...

[Fred123]

Quote:

Originally Posted by Texas Proud I was reading the interview and it sounds like a bunch of malarkey.... he said they are charging high interest rates... but they are much lower than Greece could get on the open market if they could actually get loans on the open market... I might agree more on the debt forgiveness if it were due to a war like the German debt (no mention of any other debt they did not pay).... but Greek debt is due to inefficiencies and corruption in their system.... why should they be rewarded for that As long as Greece is not willing to fix their internal problems, I doubt people are going to be willing to give them a helping hand...

So debt should be forgiven if a country starts a war, but if it can't pay back the debt due to a corrupt government, then the citizens should suffer indefinitely? That's certainly an interesting take.

[misanman]

I'm pretty clueless about the US relationship to the IMF, but I'm guessing that we support the IMF financially to some extent. Does that mean that I'm subsidizing Greece via the favorable IMF loans? Or even more so if they do not repay? Just wondering.