Greeks. Cats. Pigeons.

[CogitoErgoSometimes]

Greek PM calls a referendum on the bailout/austerity package.... doesn't tell his own Finance Minister. Trying to nut through the rationale for this move and failing miserably. Any takers?

Rationale is 'shirk international responsibilities in order to save own skin at home by bowing to public pressure'.

Slow. Motion. Car. Crash.

Unbelievable! Not really sure how they dare, not when hard working, tax-paying countries like Slovakia are having to shell out for the Greeks. Ed Balls says he completely understands! What?! Is he wanting a go on a Greek yacht or something? Just you and I on sensible subjects today Cogito!

OOps and you too Disputandum.

The way out for Greece and for the Eurozone is for the Greeks to leave the Euro. I personally feel that this is inevitable at some future point but would bring down the whole Euro project with it - hence the willingness of other Eurozone countries who have behaved responsibly to give the Greeks a share of their own tax payers cash. Even if they can get this package through they will be back in 6 months time when this bailout does not go far enough. What a mess!

It wasnt the Greek people having their pensions, wages and conditions destroyed who caused the crisis but they are expected to pay for it, just like us.

Greek wages and conditions have never been enjoyed in the UK. They may not have caused the crisis but their government fiddled the books to qualify for membership of the Euro, gave 1 in 4 members of society well-paid, public sector jobs and early retirement, and then failed to collect any tax to pay for it. I think the κοτόπουλα are coming home to roost.

Kotopoula.....are coming home to roost

The Greeks have to make the best decision for the Greeks. Presumably they've decided that bad as default would be, being bailed out may be even worse.

The same thing would happen here if we were being asked to make the same kind of sacrifices the Greeks are being asked to make. Faced with large-scale civil unrest ie rioting making what happened here this summer look like a picnic I daresay even George Osborne might start to consider Plan B.

I don't believe he didn't tell his Finance Minister and I don't believe that he decided this off his own back, because it caused markets to fall, and he would get a rollicking from the people that count.

Therefore, it must be agreed above his head in EU circles. Possibly, this is a way out for Greece to leave the Euro and blame it on the people.

Which people that count, claig, the ones who went to all that effort and committed all that money last - when was it? - last week? Why would these people-that-count keep changing their minds like this? It doesn't make any sense. Can I humbly suggest that rather than one united group of people-that-count there are a whole load of rather self important people, none of whom know their arse from their elbow.

At least that's the impression I get.

Do you think all these people would work for weeks to pledge money and support and then have him come out with this? They must know all about it.

Actually newwave they have bankrupted themselves - check out how much tax the average Greek pays. Greek problems are very little to do with bankers whoich I presume you are alluding to.

When they say "jump", he says "how high". He is in hock to them. He has to do as he is told.

Greece's problems are due to it being locked into an uncompetitive exchange rate. It was done deliberately and the politicians and bankers engineered it. The figures were fiddled and they were allowed entry. It was known all along that the figures didn't add up.

But what happens if they pull out of the Euro? I assume they default on their debt so no one is going to lend to them in the short/medium term. How do they create a currency, just print the money? If they can't borrow, I assume they print enough money to pay their public sector but it can't go on indefinately, they don't raise enough in tax to fund everything, hence the deficit. Public services collapse.........

I really doubt the conspiricy theories - the greek PM is trying to save his own ass - he faces major domestic unrest as it is before any further austerity measures. I agree Madame, the Greek problems have been caused by the terrible, myopic mismanagement of successive Greek governments along with complicit lenders.

We were also once locked into an uncomepetitive exchange rate by our Tory politicians. We asked the Germans to back us and throw good money after bad, but they refused and therefore we had to leave the ERM. Will the EU also allow Greece to get out?

I think the Greek people have a lot to answer for newwave - retiring early on 80% of final salary, 14 months of pension payments per year (with bonuses at Easter and Christmas), widespread tax evasion etc.

It's no wonder the markets stopped lending to them, and are now eyeing other high debt, high deficit countries nervously.

'the greek PM is trying to save his own ass'

I don't think so. He is only a custodian, he is doing what he is told to do by the people who are lending him money. The people are against him because they know that he is really controlled by others.

I don't suppose any country can be forced to remain within the Euro, but I wonder what signals it will send to the likes of Spain, Portugal and Italy that are not far off where the Greeks are financially? In some ways its quite refreshing that the Greeks are gretting to vote on the subject, even if it is engineered to save the PM. Would nice to be able to vote on Europe here!

ThisisaSignofthetimes, I guess it will be a managed default. Argentina defaulted but are doing alright now. The banks wrote down lots of Latin American debt many years ago. These things can be managed in an orderly way if there is a will to do it.

claig, yes do remember Argentina, I wonder what the total exposure of European banks is to Greek debt? Will we have to go through another round of recapitalising the banks, the figures involved seem to huge to be real.

There is a brilliant line in Michael Lewis' Boomerang (a MUST read about all this) where he says in most places the banks sank the countries, but in Greece the country sank the banks.

Too huge, not to huge!

Don't forget that a previous Labour government called the IMF in to Britain. The IMF tells countries what to do. The politicians have to listen or they don't get the loans.