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Good On You, Greece - But Don’t Waver Now (Part 2)
Submitted by David Stockman via Contra Corner blog,
Earlier this week the embattled Greeks delivered still more body blows to the rotten regime of Keynesian central banking and the crony capitalist bailout state to which it is conjoined. By defaulting on its IMF loan, walking away from the troika bailout program and taking control of its insolvent domestic banking system, Alexis Tsipras and his band of political outlaws have shattered a giant illusion.
Namely, that the world’s debt serfs will endlessly and meekly acquiesce to whatever onerous, eleventh hour arrangements might be concocted by their official paymasters——even when these expedients are for no more noble or sustainable purpose than to forestall a Monday moring hissy fit among the gamblers in the world’s financial casinos.
So at midnight on June 30 the proverbial can was not kicked again as scheduled. Instead, Greek democracy kicked back. And it is to be hoped that the end result will be a mighty boot to the tyranny of the status quo in the form of a resounding “no” vote on Sunday.
The latter would clarify that everything at issue between the parties is false. There is no way to pay Greece’s debts, modify the troika austerity plan, save the euro, rescue Greece’ banking system or stabilize Europe’s hideously mispriced and distorted debt markets.
Its all going to blow and it should. The entire European mess has been concocted by statist politicians and policy apparatchiks who falsely and arrogantly believe they can defy the laws of markets, sound money and fiscal rectitude indefinitely.
The truth lost in all the meaningless “puts and takes” of the latest negotiations is that the Greek state was bankrupt five years ago; it can not reform, save, skimp, or grow its way out of its crushing debt, and should stop looking for ways to accommodate its paymasters. It urgently needs to default massively and decisively, and is in a ideal position to do so.
That’s because the clowns who run the troika have taken themselves hostage. That is, they have shifted virtually the entirety of Greece’s unpayable debts from private banks and bond funds to the taxpayers of Europe, the US, Japan and even the unwary citizens of Peru, Senegal and Bangladesh.
Here is the debt in 2009–mostly owed to private banks and bondholders—compared to Greece negligible private external debt today. In the case of the French, German, Dutch and Italian banks and other private lenders, for example, outstandings have been cut from $100 billion in 2009 to barely $15 billion today.
By contrast, here is the pea under which Greece’s massive debt is hiding today. Namely, almost all of it has been shifted onto the backs of the taxpayers of these Eurozone nations.
Moreover, as the New York Times noted with respect to this massive shift, the most aggressive punters have made a killing. One of them noted quite explicitly that when hedge funds started buying Greek government bonds in 2012:
“People made their careers on that trade,” Mr. Linatsas said.”
Indeed they did. And now taxpayers around the planet have been stuck with the due bill. Specifically, $250 billion or nearly 80% of Greece’s $320 billion of fiscal debt is directly owed to the EU facilities and the IMF; and upwards of half of the balance is indirectly owed to European taxpayers because $45 billion of Greece’s T-bills and bonds are either owned or funded by the ECB.
If Tsipras were not so badly advised by his pro-euro Keynesian advisors like Varoufakis, he would realize that there is no point in negotiating with the troika at all because Greek concessions can not possibly lead to the only two things that count. That is, meaningful debt relief or reentry into world bond markets.
In fact, the sole reason for compromising—nay capitulating—-is to keep the euro, and that is a snare and a delusion.
Accordingly, a clean default on this massive burden of official debt is in order for two reasons. First, Greece’s government never asked for the giant bailouts of 2010 and 2012 which transferred their onerous debts to the world’s taxpayers. The $250 billion outstanding was forced upon them by Brussels and IMF officialdom in order to protect the German, French, Dutch, Italian and other banks; and to insure that when the markets opened on innumerable Monday mornings, there would be no inconvenient turmoil on the stock exchanges or in the bond pits.
Secondly, the troika cannot give honest debt relief anyway. That’s because officialdom is now petrified of their own taxpayers—-whom they have betrayed and baldly lied to from the very beginning. Thus, the IMF has now loaned Greece $35 billion in gross violation of its own credit standards and long-standing rules. Were it ever to take the huge write-offs that are objectively warranted by the actual facts of Greece’s economic and fiscal situation, it would be eaten alive in the legislative chambers of its member governments.
Indeed, in the case of the $6 billion share of the loss attributable to the US quota, the Republican congress would have a field day investigating the incompetence and misdirection underlying the IMF’s role in the Greek bailout. The IMF would never again achieve a congressional majority for a subscription funding increase—effectively putting it out of business.
And that’s nothing compared to the political explosion that would be unleashed in the national parliaments of the Eurozone itself—– were proper debt relief to be granted. As shown below, the Germans are on the hook for $56 billion of the direct fiscal debt, but that’s not the whole of it by any means. Through the backdoor of the ECB, German taxpayers have also loaned Greece another $36 billion in the guise of liquefying the collateral of the Greek banking system.
“Liquefying” my eye!
The Greek banking system is hopelessly insolvent; the so-called “Eurosystem” obligations shown below are nothing more than fiscal transfers. Accordingly, what the clueless Angela Merkel actually accomplished during five years of weekend Gong Shows was to bury her taxpayers under $92 billion of liabilities—–nearly all of which are off-budget and unacknowledged.
Her desperate and mindless temporizing in order to remain in power thus constitutes a monumental political lie and betrayal. Were this to be exposed by a major write-down of the Greek debt,it would lead to an instant fall of her government.
The same is true for the rest of the Eurozone—only the facts are even more egregious.
France’s share of the fiscal debt is $42 billion and its total obligation including the ECB exposure is $70 billion. But France has not had a balanced budget in 40 years; is suffering from record unemployment and a decaying economy that has been suffocated by socialist taxes and regulatory dirigisme; and will soon join the triple digit club on its public debt. Accordingly, its government is petrified by even mention of Greek debt relief.
Then you have Italy buried under a 130% debt-to-GDP ratio and an economy that is 10% smaller in real terms than it was 7 years ago. So it is not surprising that its paralyzed, caretaker government does not wish to contemplate even the prospect of a write-down on the $37 billion of fiscal debt owed by Greece or the $60 billion of total exposure.
Then there is the crook and fiscal phony running Spain. No wonder Mr.Rajoy has practically threatened to take out a contract on Alexis Tsipras’ life. Spain’s economy is still grinding away 15% below its boom time peak and its government is faking its fiscal accounts to a fare-the-well. Still, its public debt continues to rise toward 100% of GDP.
So its cowardly government would rather consign the Greek people to permanent depression and debt servitude than own up to the $42 billion it has loaned the Greek state and banking system in order to keep the European banks and bond funds afloat.
Source: @FGoria
After generations of fiscal profligacy the Greek government should not worry about re-entering the capital markets at any time soon. It should resign itself to running primary budget surpluses for the indefinite future based on whatever domestic political consensus it can cobble together on the matter of taxation, pension reform, divestiture of state assets and weaning its crony capitalist leeches and special interest groups from their stranglehold on the Greek state’s depleted coffers.
Under such an all-Greek fiscal regime, it need not worry about its $250 billion of official fiscal debt or even the $130 billion of Euro-system obligations. Here’s why.
None of the governments which foisted these obligations on Greece will survive a blanket default. The more likely scenario is that the successor governments—–almost certain to be anti-EU—- will disavow the guarantees undertaken by the EFSF and demand haircuts from the underlying bank and bond holder claimants. Stated differently, a Greek default on its $150 billion of EFSF funding would trigger a domino effect back to the status quo ante.
In any event, the only alternative to this sequential chain of defaults or punishment of Eurozone taxpayers is to send in the German and French armies. But unlike the Ruhr in 1923, there are no coal mines, steel mills or other significant industrial assets in Greece to occupy. The geniuses at the troika have essentially made massive unsecured loans that are uncollectible—–proof positive that, among other things, governments shouldn’t be in the banking business.
So if Syriza gets its “no” mandate Sunday and if meaningful debt relief is impossible, what is it exactly that it would negotiate for from an arguably strengthened position? The conventional answer, of course, is continued ECB support for its banking system and retention of the euro. But both of these objectives are invalid, and are just gateways back into subservience to the Troika.
Since Greece is already irrevocably knee deep in capital controls it need only complete the process and nationalize the banks since they are irreparably insolvent anyway. For instance, Greece’s three largest banks with available public data—–Alpha Bank, National Bank of Greece and Eurobank Ergasias—–have upwards of $60 billion of non-performing loans, which represent nearly one-third of their total book of $180 billion. In addition, they also have $50 billion of bonds and other investments—much of which was issued or guaranteed by the Greek state.
Against the massive imbedded losses in these totals, by contrast, the three banks have only $9 billion of tangible book equity excluding their worthless tax-deferred assets. In short, neither the stock or the long-term debt of these banks have any recoverable value at all.
As part of a housecleaning at these wards of the state, therefore, tens of billions of bad debts would be written off including the debt of the Greek state. And the massive $130 billion of ECB claims would be primed by the claims of domestic depositors.
To be sure, most of the deposits have already fled the Greek banking system and there is upwards of $50 billion in euro notes and coins in the billfolds and mattresses of Greek citizens and multiples of that in off-shore bank accounts. Nevertheless, under a proper state directed liquidation and clean-up of the Greek banking system, the remaining domestic depositors would be made the senior creditors of a shrunken but solvent banking system. The eurosystem’s $130 billion of claims, including the ECB’s lunatic extension of $90 billion in ELA funding to the Greek central bank, would be forced to take a deep haircut on the subordinated claims it would hold after a restructuring.
Given what needs to be done with respect to Greece’s massive fiscal debt and its insolvent banking system, why would Syriza want to make post-referendum concessions to the troika for the privilege of staying in the euro?
The short answer is that is wouldn’t and shouldn’t. After the necessary fiscal default and nationalization of the Greek banking system the euro is a club no one would want to join.
Stated differently, underlying the present fraught confrontation between Greek democracy and the troika’s financial oppression is an epochal catch-22. The sweeping debt relief on which survival of the Greek economy depends would unhinge European politics, discredit the so-called European project and shatter the flawed and unsustainable money printing regime underlying the euro.
Indeed, if the Greeks do not waver after a successful rejection of the status quo on Sunday they will not need to feel lonesome about returning to the Drachma. The Italian lira, Spanish peseta, Portuguese escudo, the French franc and countless more will be back in short order.
Think of that. The IMF out of business. Merkel and Brussels gone. The Bundesbank and D-mark restored. The Keynesian money printers discredited. The front-runners and speculators in the casino carried out on their shields.
Now that’s a referendum that the world desperately needs.
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The start of a global Jubilee ?
Default or not Default? That is the question
(ANSA) - Brussels, July 3 - Greece's missing a payment to the International Monetary Fund is a "default event" that has been notified to the European Financial Stability Facility (EFSF).
The IMF called Greece’s default “in arrears”.
The EFSF will call it a “delayed period”.
The ISDA will name it an “unwanted pregnancy” without triggering CDSs. I think? ;-)
Looney
P.S. ISDA = International Swaps and Derivatives Association
http://www.ansa.it/english/news/2015/07/03/greek-non-payment-to-imf-act-of-default-efsf-says_7465ff6c-0d7b-4db1-b376-234a00b89e85.html
unwanted indeed - thanks for the laugh.
No, it's good for nobody. Debt and more lending is the problem. The IMF/Central Banks only have money to fix the problem and money is the problem in the first place. You don't fix cancer with more cancer.
We must get this out of the hands of money-changers, it is systemic and unfortunately government, good honest worthy government is our only hope of fixing this. I do wonder what the UN is doing to "prevent" such events. World leaders must get a grip on all lending institutions that can place irresponsible/shortsighted/corrupt countries in a Greece situation.
We know the cause, symptoms and prognosis but fail to find a cure other than the same usual suspects trying fix it (make a far removed profit or avoid a loss) with more loans/restructuring. If they had done the due dillegence there would be no restructuring needed and Greece would be, like the rest of, getting by.
The US, G7, G20, UN someone, somewhere must take lead and cure the world of this bankers disease. The bankers caused it; keep them away from the patient.
What if the 3 others (PIS on the EU) do it at the same time?
@two hoots
Unfortunatly...................the peeps are the banks....................because of the deposits and debt owed to the banks.
Debt is credit If you have money in a bank or owe the bank...................you are part of that bank...................and through Bank to bank interlending.................you are part of them too!
my head now hurts.
I need a beer
XX, after your beer (or two/three) get your head out of the money/bank (generic) box and think of something to stop banks /irresponsible governments from leading themselves and their people down this path. We must find a different way.
@two hoots
I was not disagreeing with you.
It was pointed out to me.................................when the UK bailed it's banks in 2000 and when ever I said let them go.
And I was reminded that it was our money that would be gone (those who had deposits)
That said, I still think that is what should have happend, let the banks fail and if there was anybody that should have been bailed it should be depositers.
Time for a new 4th of July holiday Golden Jackass interview on TFMR
Turd and the Jackass for 1.5 hours...what could possibly go wrong? haha :-)
It's on the house, so if ya wanna kill some time and hear Jim Willie's thoughts on the geo-political and economic collapse underway as we speak, here's the link:
http://www.tfmetalsreport.com/podcast/6968/jackass-our-own-yankee-doodle-dandy
Enjoy this 4th of July, folks. Think about what it means and what it stands for. The future of freedom not just in America but the rest of the world hasn't been in this much jeopardy since WWII. The new threats to freedom and liberty are hitting us from all angles. Get prepared. By this time next year the scumbags in charge will be banning the 4th of July just as they're banning everything else and driving us into another world war situation.
can anyone spam send to tzipras the link this page ?
it kinda hurry.
Can we cut the poop and call this what it is?
When a united governmental entity takes actions deliberately designed to destroy not only another county's government, but also its entire society, that is war.
This is war - plain and simple - between the country of Banksters aka the ECB/IMF/EU/Brussels/Berlin axis - and Greece.
It is time for Greece to admit that they are at war with this governmental entity, and declare they will do whatever is necessary to destroy the attacker. That includes killing off the attacking governmental entity's leadership to the degree necessary to stop the attack, and regain the safety necessary for a society to function productively.
ZH posted another article along these lines earlier today - and this is the reality of Greece's situation. What we have here is an unelected leadership serving the constituency of Banksters and their Owner-Oligarchs, and not the general population waging a war to take possession of everything Greek. The Greek people either fight back - using Special Forces to conduct raids on the Bankster/Oligarch leadership and bureaucrats to kill them, and destroy their Command and Control infrastructure to the point where they surrender, and using popular uprisings that include attacks on the supporting member governments who allow this war to be waged against Greece, or the Greeks capitulate and become debt slaves and peasants.
This is the real End Game - Them or Us. Only one will survive. The Greeks better make sure they understand that nationality is now meaningless beyond defining the geographic area under attack; the true war is the 99.9% against the .1% and their stooge Deep State.
Everything else is just poop.
-30-
Well after reading ..............................it does not matter what the vote is
The European project..........................is over all by the shouting if not on Sunday/Monday ...................very shortly.
Greece cannot pay.................without hair cut....................no haircut otherwise all the pifs will want one.
For Europe there is no win situation. For Greece...........there is
Stop, shmita time!
Yes. Dismantle & liquidate the freaking banks, protect depositors only, unwind the deals & claw back the stolen & illgotten gains, jail the fuckers & start again...
Now
Guillotines will be the end result.
That would be great.
If the past is any indicator, the "vote" will be a "yes". Something or other will be "restructured" amounting to yet another coat of veneer and it's right back to business as usual. This all goes down the memory hole like Scotland and everything else.
Based on polls, the Greeks are starting to cave. Narrow self interest always wins. I.e. if I vote "yes", I will have more time to go to the bank and withdraw my savings.
If there had been a colonial referendum in 1776, there would have been no revolution.
"Democracy is a pathetic belief in the collective wisdom of individual ignorance."
-H. L. Mencken-
I'm with you. I don't see the Greeks winning the battle against the bankers.
Not to be overly pessimistic (in classic ZH doom), but I don't see any of us winning against them.
actually, the battle against the bankers is already lost, in the case of Greece. check who holds Greek debt and see if it's "the bankers" or the other sovereigns. just saying
"... check who holds Greek debt and see if it's "the bankers" or the other suckers. ..."
fixed it
ah, that's what "total" on the table 1 of the article means. I stand corrected
He really meant to say other sovereigns tax payers, who are already under a chitload of personal, public and unfunded debt.
ya but-----if the payers fail to pay(or don't just out of orneriness) then it is the payee that will hold the empty bag--and being believers in the "system" the payees (lenders) will anguish over debt unpaid cause the indebtedness of others is their only gage of richness.
"Based on Polls..."
Stop right there! And WHO is conducting said "Polls"? Fox News?
TPTB are simply trying to manipulate the outcome with their predictable Jedi Mind Trick. That becomes self-fulfilling, if you get enough air time.
Same PR/Propaganda shit went on in Scotland. Was that you, Don Draper?
I understand your scepticism. I don't feel like going through my browsing history to find the source, but the polls cited were by Bloomberg and a Greek outfit. Reliable? Who knows, but behaviourly it makes sense. In addition, Varoufakis is now apparently saying "yes, no" no biggy either way, which to me means he isn't so sure of the outcome and his pledge to resign if "yes" may come back to bite him in the ass. What made the founders so rare is that they actually put their ideals ahead of their self interest. So far, that quality is absolutely non-existent among any of the participants in this tragicomedy.
What Greece should do and what Greece will do are two totally different things. There are too many vested interests in the older population that will be unwilling to ever give up "free" money. Greece will in all probability vote YES by a wide margin, enthusiastically give up any resemblance of a free country to continue what has been a free money handout. The EU likes that as well, given that is continues to validify the Brussells Reich.
Cooperate or be selfish? That is the question, in game theory.
If things get really bad for both the EU and Greece, it raises the stakes for cooperation. But if trust breaks, they go selfish. And that means chaos. Don't forget Club Med is watching this very nervously.
considering milgram experience, expect a 60-40 for the yes.
as the population is just about "free shit now" and have no ability to think about futur ( otherwise they would not have stay in such situation for 5 years... )
they will vote YES to get money back at bank.
period.
Yup, sheep are sheep whether Scottish or Greek.
... a note to Mr. Tsipras ... "It’s good to have enemies. It means you've stood up for something, sometime in your life", Churchill says; except if you have no legs, then you’re excused ...
... and a short note to the citizens of the Hellenic Republic >>> http://www.zerohedge.com/news/2015-07-03/contagion-continues-italy-spain-stocks-tumble-post-greferendum-lows#comment-6265954
"Greek government should resign itself to running primary budget surpluses for the indefinite future"
And even that is very hard to do for them right now
IMF'd = I am fucked.
You guys that think this is all the bankers fault......to me its the Socialists fault that think free money is just that..free...its not....greece will starve because of this....that is good..they need some pain to get back to normal.....and they should be shut out of any debt markets for 20 years.....no more loans Greeks....if you want to retire at 50...pay for it yourself...
Weren't the socialists created by the banksters?
There should be stats on how many Ghost Towns we know about. Each ghost town had their day of reckoning when everyone just left. Diasporas are not uncommon. If things don't work out then leave. Divorce, quit, give up, walk out. At times it is best.
If the fed had kept to it's mandate of keeping prices low, they prolly could retire and pay for it at 50, now with the feds mandate of making money, you can't retire and pay for anything unless you were given money first and then did all you could to make more, how? by raising prices naturally.
I've got bad news for you youngman, the bulk of these monies were borrowed by quite Conservative Governments that have been in power in Greece for a long time. Syriza were only elected into power earlier on this year and had this S**tbag handed to them only after they came into power. A Good 4th All :) Marty
Whew, huh? Lucky it's not too serious!
Shouldn't the TEA PARTY be at the forefront of this battle?
I thought the TEA PARTY was going to defund all the wars and force serious reforms.
Guess not.
troll
"Control Files" are like assholes - everybody has one!
"Think of that. The IMF out of business. Merkel and Brussels gone. The Bundesbank and D-mark restored. The Keynesian money printers discredited. The front-runners and speculators in the casino carried out on their shields."
lol, now that would be an interesting referendum
but isn't the D-Mark a fiat currency, too? in which sense would a D-Mark be less "Keynesian money printing"?
and wouldn't the very "front-runners and speculators in the casino" love, love, love to bet on the D-Mark? best if there is a counterpart in europe to bear the other side of the bet?
and this betting would not force the Bundesbank to act in the same way as the SNB with it's CHF? we are still in a currency war, aren't we?
I like Austrian School and Keynesian-bashing arguments, but sincerely what I see is Keynesians hating the EUR for Keynesian reasons and "Austrians" bringing half baked arguments
meanwhile, the front-runners and speculators... love the turmoil for the simple reason that they love volatility
can't have too much of a good thing then?
Fair points, but I think the author is alluding to the Keynesian concepts of anti-cyclical deficit spending and the belief in debt financed growth. Aspects which pre € Germany was not known to be associated with, though the "Wende" aka integrating East Germany was probably very Keynesian.
That's all nice, but no Euro, no industrial civ for the Greeks. Do they want an agriculture and tourism based economy?
This is conjecture, but one thing that I haven't seen expressed is the high probability that the players in the Greek government have been cajoled, blackmailed and bribed to keep kicking the can, just as it was done in the previous governments. Considering what is at stake here for the banksters, one can imagine what may have been whispered behind the scenes.
Since the default to the IMF, we're in unknown territory here - the territory of exposure to the obvious truth of the situation that the debts are unpayable. That all debt mountains in the developed world are unpayable. The outcome of such rare honesty in a delusional world can only be a systemic reset I reckon, but I won't hold my breath just yet.
@YHC-FTSE
I think the IMF has decided.....................if were going down......................we will take you with us.
Not sure they would want to telegraph a reset...............but that could also fit in with what I have written above.
And just to add to the mix......................they are pushing for the SDR as a reserve currency.
Nonetheless, you have to face reality. Mario Draghi, is ex-Goldman Sachs and he will take his direction from them – not me. Christine Lagarde is a lawyer with no background in trading whatsoever. Besides that, I was invited by Edmond Safra to the IMF Dinner in Washington years ago to show me how the banks had the IMF in their pocket. So I highly doubt the IMF would ever listen to me after I have been critical of their role. In addition, they will fight to preserve only the bondholders – never the people. They are lobbying to make their SDR the new reserve currency and will have meetings on that starting in September in line with the ECM turning point. So this is a power-play for them which I seriously doubt they would give up to help anyone.
http://www.armstrongeconomics.com/archives/34348
SDRs aren't worth a shit unless they are borrowed/loaned and collateral is involved---other than that just zeros in a ledger.
in my experience, pulling out is a hard thing to do, so you do so at the very last minute.
One tends to destroy the yound lady's fair complexion and bossom at that point
like the erupting Greek volcano at Santorini
Oquities
"in my experience, pulling out is a hard thing to do, so you do so at the very last minute."
I prefer to fall out ......................or pushed................so to speak
Be grateful it is not like trying to put an oyster in a parking meter. Can't fall out if ya can't get in...
Comment of the day - I am still laughing. + 100
Its the person on top's responsibility for the pull-out.
The Greeks won't let go of the magical thinking that they can stay in the EU while at the same time ending austerity.
Everyone wants to have their cake and eat it too.
Apply that to every country and it is the same want.
Monday's headline - "Greeks Decide To Take It Up The Ass Again"
No one gives a shit about IMF. They're the next level who posted a GDP Forecast.
The media will not spot the connection with IMF, World Bank, or Bank of International Settlements.
Who cares. They're frauds skimming money to place liens on property owners.
I told you 4+ € years ago.
>>> After generations of fiscal profligacy the Greek government should not worry about ...
Try:
"After generations of lobyist crony capitalism with austerity for the proletariat, the Greek government should ... "
I'll be happy when that bitch Lagarde is dumped in an Egyptian square and gang raped till her eyeballs pop out.
America is spending so much time on drones. Brussels is a new untapped territory to capture the working group in progress of constricted peasants monkeys.
What happens if a drone captured them in the parking lot? Coming soon with audio. The video has been created, not released.
Then what happens? Silly fucks will get into a mode of terrorism. They are the terrorist.
INteresting to note the different countries responses to clearing the Greek debt.
All the European countries have cleared a good % of the debt. The only ones who still have roughtly the same exposure are the US and the UK. Ask yourself why that is? Why would the US and the UK not be concerned about reducing their risk?
The answer is the US and UK bankster business have essentially merged with the money printing business and there already is no risk. No matter what investment risk the Banksters in those countries encounter it is, by default, offloaded on to the respective tax payers (future of course).
@RTTB
US and UK......................have got a printing machine
Not only got it, but merged it with the Bankstering business.
They are one and the same.
@RTTB
Yes....................with Japan etc
IMF...definition... " I Mean Fuc*ing" business!
Immediate
Malfunctioning
Finacials
ECB/TROIKA: "Sorry chumps. The necessary yes vote has already been arranged."
Hmm.... So the haircut could be returned to the originating banks and bondholders?
This is as good an explanation as any:
http://www.dailymail.co.uk/news/article-3148451/A-island-pretending-blin...
I always think of who benefits? In they kick the can, cunt politicians and fuckface banksters benefit and greek people get assraped. If they don't kick the can you have a chance to strike a body blow to the same. Either way greek people are gonna go thru some tough times but at least with a fuck you to the pols and banksters they retain some dignity
Almost makes you feel sorry for poor old Corzine. All he had to do was survive until 2012.
One of the few accurate depictions of the problems. Yes the EZ governments knowingly misled their constituents on this in the hope that it wouldnt blow up in their face until another administration took office. That debt will have to be written down to a significant degree. But i would hope that that would only be granted in exchange for insisting that Greece agree to leave the Euro Zone and the EU. enough is enough. Europe must move on and focus on the problems that can be solved and not waste taxpayer money all the time on the 119th eurogroup bailout meeting for Greece.
Once Greece is out, both sides will be better off. And one day if Greece creates a functioning tax collection agency, a reliable land registry, a competent statistics bureau and a political system not based on patronage, kickbacks and bribery, maybe should that ever happen they can think about joining EFTA then. But EU? No thanks - not for a century at least.
If only Greece were being run by a competent fiscal conservative government, they could take the EU and ECB to town with a intelligent default plan described above. Alass they're run by more Keynesian liberals who think the problem is that the government isn't allowed to spend enough for the economy to 'grow' This ends badly for Greece either way with Syriza in charge.
Magnificent.
I am translating that and sending to every Greek citizen in a mass mailing tomorrow morning
Finally, an official columnist looking at the matter clear-headedly. What cannot be done will not be done. Greece's debt is unpayable, like Germany's reparations after WWI. As with Germany, the creditor nations have desperately played "extend & pretend" until even extension is practically impossible. Greece's only solution is to default and nationalize the banks. They will have to pay their was as they go from that point, without access to credit markets, but SUPPOSEDLY they had a primary surplus of 1.5% last year and are at least making ends meet. With the freedom to make their own decisions as to how they balance their budget, they should be able to do it one way or another.
At the same time, now that Greece's debts have been gobbled up by supranational institutions, the only way to dematerialize the losses is for the institutions themselves to be dissolved. That will spread the losses around to half the world, which is much more manageable than trying to recover them from Greece alone. Also, much of the loss will fall on the ultrarich speculators, who don't use the money for anything useful anyway, instead of Greek pensioners.
As for WWIII, it need not result. WWII arose out of a fifty-year blame game for the costs of WWI and the complicity of bankers in creating those massive costs. It was complicated by the problem that so many of those bankers, in Germany and Eastern Europe, were members of a reviled caste of outsiders who had specialized in loan-sharking for a thousand years. And by the international Gold Standard, which was inadequate for the sheer amount of currency needed for the modernizing world to function. We can have Great Depression 2.0 without WWIII, if we behave ourselves.
STOP
This a MONETARIST POLICY and not KEYNES
Cutting public spending (as all Europena countries are doing) and flooding the economy with money is a monetarist measure,
a measure of the richest liberist right.
The free market defenders (usually the banksters) are the first to ask public intervention when things go wrong.
Keines theories (adjusted) are the only ones to have proved to be right.
Liberist-monetarist theories already failed in the '80s.
So, you should study more !!!