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Sunday Humor: How Greece Escaped The Recession
Given that Chinese GDP numbers are manufactured top-down and don't add-up; and that the US - in its wisdom - added "intangibles" to its GDP measure of economic progress and create $500 billion worth of growthiness out of thin air; it should not come as a huge surprise to learn that Greece is picking up bad habits. Following the realization that all their promises (and IMF forecasts are total bullshit), Eurostat will adopt a "new methodology" that will boost Greek GDP by 3 percentage points and historically reducing the depression in the Greek economy to a 0.3% shrinkage to be proud of. But where it gets downright idiotic, is that as a result of the methodology change, Greek GDP in 2014 will "grow" 3.6%, orders of magnitude above the previous forecast expansion of 0.6%, and also well above how much the US economy is expected to grow in 2014. Yup - good stuff.
Troika forecasts of the past... as a reminder...
The new methodology Eurostat is to adopt from October will see Greek gross domestic product boosted by 3 percentage points for this year, while reducing the ratio of debt to GDP by 4.4 percent.
The European System of Accounts (ESA 2010) will replace the existing ESA 95. The next deadline for the submission of data by the Hellenic Statistical Authority will be in September and it will use this new system. Where the new system is different is that it takes into account defense expenditure, investment in research and development, and the export of goods for further processing. Greece will benefit as it has a large defense bill.
The new method, for example, would have seen recession in 2013 shrink from 4 percent to just 0.3 percent, including the impact of the deflation, and turn the small GDP increase of 0.6 percent projected for this year to a robust 3.6 percent expansion.
Nothing like adding intangibles in the fluid, ever-changing definition of what constitutes an economy.
Naturally, the only reason for this artificial "boost" to the [Greek] economy which apparently can be any old arbitrary number agreed upon by a few accountants, and which always goes up post revision, never down, is to flatter Greek debt/GDP once again, if only very briefly, to satisfy any need for the Troika to justify moar bailouts to keep their own dream alive. Surely a few months later something else can be "added" to GDP making the Greek economic crisis disappear entirely... oh yeah apart from the record unemployment, delinquent loans, homelessness, suicides, and a rising nazi party...
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Whatever...
"You can ignore reality, but you can't ignore the consequences of ignoring reality." - Ayn Rand
"You can ignore reality, but you can't ignore the consequences of being serially reamed up the ass by banksters and EU bureaucrats".
-The Greeks
(And if anyone should know about anal rape, it's they!)
(or Karl Denninger)
All the goodness of the US redefinition of GDP without the pesky recalculation of all numbers back to 1932. Please feel free to compare the numbers from the old method with the numbers from the new method as if they're the same.
It's simpler. Greece avoided the recession by going straight into depression.
Apparently not, Ignatius. According to the new numbers, nothing happened.
Yes, bullish!
"The question isn't who is going to let me; it's who is going to stop me." - Ayn Rand
"We are fast approaching the stage of the ultimate inversion: the stage where the government is free to do anything it pleases, while the citizens may act only by permission; which is the stage of the darkest periods of human history, the stage of rule by brute force." - Ayn Rand
"The ladder of success is best climbed by stepping on the rungs of opportunity."- Ayn Rand
More economic data from the Ministry of Plenty.
"But actually, he thought as he readjusted the Ministry of Plenty's figures, it was not even forgery. It was merely the substitution of one piece of nonsense for another. Most of the material that you were dealing with had no connection with anything in the real world, not even the kind of connection that is contained in a direct lie. Statistics were just as much a fantasy in their original version as in their rectified version. A great deal of time you were expected to make them up out of your head."
you can ignore ayn rand.
But can you ignore the consequences of Ayn Rand?
appearently not
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Minimum Wage +Plus**
Daily bus fare provided.***
Coupons for McDonald's Happy Meals.
* Unions dues remain in effect and must be paid by temporary workers.
**+Plus = chance to make history clearing seats for first Super Bowl to be played in an open-air stadium.
***One-way fare, a generous 50% contribution to employee transportation costs.
Advance notice of temporary employment: 82,500 seat-warmer jobs for 24 hours before kick-off on Feb 2.
Minimum Wage ++Plus****
.All-you-can-eat bean burritos while warming seats.
On arrival Feb 2, ticket holder may tip seat warmer (Note: tips are reportable income)'
****++Plus = minimum wage will be doubled for any worker whose fat ass can warm two seats. .
I know...let's have it in New Jersey.
You will if yas knows what's good for yas, know what I'm sayin'?
Don't try this on the private sector books my friends, the public sector will throw you in jail over it.
Jus sayin ;-)
When things get bad, you have to lie.
Somehow, I think TPTB already know things are as bad as we say on ZH. They're just arranging the chess pieces behind the scenes and playing for time. When this thing goes down you will see the most controlled, pre-planned chaos the world has ever seen.
Not at all. Listed companies pull exactly this bullshit with intangibles, all the time. Expanding by buying crappy companies from related parties, putting millions into goodwill. Then when this goodwill inevitably is impaired, the loss is described as "one-off" and "non-cash", and is not included in the "underlying profit" measure used to pay bonuses.
Great point about goodwill accounting.
"Eurostat will adopt a "new methodology"
https://www.youtube.com/watch?v=FKss2pBYQ6Y
I'm thinking of the " Goo Back-future" South Park - episode.
The US has been doing that for decades by understating inflation. US GDP would be less than half if real inflation was used in GDP calculations. And let's not forget the $500 billion added to US GDP on July 1, 2013 mainly due to film royalties - yes, the flim-flam adjustments to US GDP
http://www.shadowstats.com/alternate_data/inflation-charts
http://www.zerohedge.com/news/2013-04-21/us-gdp-will-be-revised-higher-5...
Don't forget the new proposed Greek Slavery Program where companies will be able to hire people under 24 for a year at ZERO wages. The kids left in the country that don't have work will be exported. To where is not known.
No shit, i'm not kidding.
So I suppose free labor might be gdp positive.
Spot on. Those crazy bastards will impute a value for that free labour and then incorporate it into GDP.
The productivity of any labor when it's cost is zero..... is infinite. You're looking at the most productivite broke people the world has ever seen, I think.
Then they won't understand how come no-one will buy their stuff so they'll have to lower prices and make up the shortfall by getting the youth to pay for a year's work ...
That was just a suggestion. It hasn't been implemented and it won't. But, if they really wanted to boost employment, they should get rid of the mandatory insurance system they have and the 14 monthly payments that must be made.
Greece is in a death spiral. Too bad there is no Galt's Gulch anywhere near here.
So what you're saying is, if you apply the same accounting practises to Greece as America, Greece is actually doing better.
If you take out the food stamp system of the USA, Greece is paradise compared to the USA and the USA would be an uncontrolled hell.
While Greece's right wing parties range from understandable nationalism to batshit crazy neonazism, even the whackjobs ask a fair question - with all of Greece'-s woes, why are relatively large numbers of illegal immigrants still being allowed to pour in?
That is, leaving aside the legal, intraEU migrations of more poor, unemployed, non-Greek speakers, which also wouldn't seem to help Greece itself.
http://migrationinformation.org/Profiles/display.cfm?ID=884
Utopian thoughts about a world without national borders aside, is there any coherent argument that this is being done to help the people of Greece?
Just proves there are Worst places than even Greece
For sure - and you can't, as is generally true, blame the immigrants for trying to escape from even worse circumstances, but it seems to me that it also begins to hinder Greek's potential for recovery - which isn't great to begin with.
Perhaps if they factored in the droppings of donkeys and mules into GDP and the methane of politicians, we could see some extraordinary growth in Greece.
If the TROIKA is so smart and Greece is on the right path, let's see them decrease the debt in EURO terms rather than fake percentage terms.
"...just remember, it's not a lie if you believe it..."
George Costanza, 1996
FUCK YOU YELLEN!!!!
How can Greece escape a recession when it is firmly embedded in a depression?
So the world and the people of Greece are supposed to accept this new methodology as proof that a .3% GDP recession caused 25% unemployment and 50% youth unemployment--and hospitals without sufficient credit to order routine medical supplies?
EuroStat is just a shameless tool for a bunch of cold-blooded liars.
Greek GDP is irrelevant - the only thing that matters is when the next bailout will be, and whether the Greek leaders will fold again or fight the EU for their people's future.
What's everyone looking at? Mountains of unpayable debt.
When the truth doesn't suffice, produce lies.
Greece needs to get out of the EU, default, and offer their ports to the Russins while begging for Chinese investment. Everything else is rearranging the deck chairs.
Why the fuck does any country need "investment" from another country?
Unless they want to buy resources from the "other" country.
Slaves.
Greeks are going to make 16-24 yo's work for free. Foxconn can get free slave labor if they build a secure city-size factory compound in Greece to make iPads and tennis shoes. Win-win.
/johnny-cocknballs what the fvk kinda name is that?
You can't make this stuff up! I wish I could pay my bills with "intangible benefits."
I'm with you on that one. "Ignore my puny little "job" or lack thereof. You should give me money because really I'm worth a gazillion ..."
This only works if a Goldman Sachs alum cooks the books.
The "emperor" has no clothes... but he does have a hide!
Problem solved
I love that graph every time.
Greece? Time to move to Venezula....
"...Where the new system is different is that it takes into account defense expenditure, ..."
just brilliant. no more hypocrisy.
EU accused of hypocrisy for £1 billion in arms sales to Greece
Broke? Buy a few warships, France tells Greece
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France Is About To Sell Four Of These $412 Million Warships To Impoverished Greece