When Eurozone collapses, what next? (feels more when than if)

[Hamishbear]

Posted on Chat but felt this may be a better place.

So, the bailouts can't continue indefinitely, what happens next?

What's the best case scenario and how will it affect us in the short term and long term?

Bailouts will probably change in nature rather than stop all together. I was listening only yesterday to some alternative, more direct ways to get funding into various countries. Sounded interesting. There are big incentives to keep the Eurozone project together and I suspect that, once things stabilise a little, EU leaders will start looking at a Roosevelt-style 'New Deal' inter-European work creation. Short-term it'll be more difficult to sell into the EU from Britain because they can't afford our goods and the exchange rate is working against us. Longer-term is less easy to predict but 'collapse' is premature.

I don't pretend to fully understand but it feels to me we're on the edge of a precipice. Nigel Farange puts it better than I can, will try to find the link.
I can't see how it is sustainable. What are the incentives you mention? If Greece does leave and others follow, what then?

I don't get though what does happen if Greece leaves? 'The others' would be the PIIGS countries, wouldn't they? Those who should never have been allowed into that club in the first place, in fact!

Why would allowing Greece out, to reprint the drachma and thus allow Greece to devalue itself til it became competitive again? It could equally be the peso or the punt!

The Greeks should have looked at Iceland, they let the banks collapse.

Greece is 2% of European GDP. The Euro won't collapse, it will in fact get stronger. I think this is happening to put the frighteners on other countries and the Greeks are being made an example of to bring other countries into line. I think the objective is a closer fiscal union, with budgets subject to Brussels centralised control. It is a way to ensure that countries sacrifice some more of their sovereignty. I think the heat is being turned up, but when countries play ball, then the heat will be turned down again, and the Euro will rise even stronger.

The European elite want a closer financial union. Cameron and Osborne also want a closer union for the Eurozone countries. Cameron said something like it is make or break. Of course, it will be make and not break. Boris Johnson seems to be against this closer financial, but he is not at the heart of power.

'The Greeks should have looked at Iceland, they let the banks collapse.'

The mainstream Greek political elite, the establishment, are all part of teh European project and quite a few of their ministers are ex-bankers. They got the Greek people into this mess, and they will not let banks collapse, since bankers call the shots.

Livingstone, the socialist, seems to have changed his tune. Everybody knew all along that the entire European project was a political project, and the socialists who wanted fiurther integration and our entry into the Euro must have known that very well, when they chatted with their socialist counterparts in the rest of Europe.

The socialists carried out the policies that the elite and the bankers wanted, as they always do.

The Euro was a stepping stone to further political union. Everybody knew that, and that is why the Eurosceptics alone were against it, while the socialists championed it.

The elite want a closer political union; the socialists will do what the elite say, and a closer union is on the way.

Everybody knows that austerity can't work. When Germany was destroyed after the Second World War, the victors didn't impose more austerity and more cuts and more payments to the banks; they created a Marshall Plan to pump in investment and create growth.

When the heat has been turned up sufficiently, when the elite have sent a message and countries forge a closer union, then the heat will be turned down, and the German economic powerhouse will start a programme of investment which will strengthen the entire Eurozone.

Where will it leave us?

We will probably end up joining it in the future. Listen to the socialist, Mandelson. These things are decided above the heads of the socialists by their elite and capitalist banking masters.

www.independent.co.uk/news/uk/politics/mandelson-kicks-off-new-proeuro-campaign-7712259.html

The Eurosceptics were right and so were the climate change sceptics. But the socialists disagreed with them both, and followed their elite masters.

See the idiots have finally rolled out the 'big bazooka'.

That should delay the inevitable collapse of the Euro for at least...em... 3 days?

Some people just cannot admit the idea was dopey from the start - we're now in scorched earth territory as this could bring down Germany too (as it will be the prime provider for these 600billion euros that will be going down the plug hole.

Hopefully the parliamentarians of Holland and Germany that will need to ratify this will see sense. The other members that will also need to ratify it would be beneficiaries - so no problems there then.

I agree with you Claig - up to a point. I don't see the UK joining. In fact it's amusing to see the former exponents all backing away from their former stances rather rapidly . As for it being a Socialist experiment - Ted Heath took us in and he knew exactly what the Common Market / EC / EEC/ EU's ultimate aim was.

However as a longstanding, politically active Eurosceptic, it's nice that I'm no longer considered mad / looney /rabid Little Englander

You're right, WetAugust, it's not a socialist projetc - it is an elite project. What has changed is that most of our socialists are now a tiny part of that elite. There was a time when many socialists were against entry, back in the days when Ted Heath and the Tories were for entry. And still today, Arthur Scargill and that type of socialist are against it. But those socialists are a small voice when compared to the Establishment socialists.

The comparison to WW2 is interesting. For UK had rationing until 1954 and only paid off its war debt in 2006. The length of the cost of the debt, and the time it took to re-establish even food supply shows a shadow over generations.

Pumping in money is expensive (and who could afford to be the backer?), and effect uncertain - post WW2, there was obvious need to rebuild bombed out cities and massive consumer demand to replace domestic items after 5 years of make do and mend. It's simply not the same now. Where is the growth going to come from?

'Pumping in money is expensive (and who could afford to be the backer?)'

But who can afford to pump billions into quantitative easing and now yet another 100 and something billion loans to banks on the promise that they will lend it to businesses. Businesses and banks are already siting on piles of cash, but they won't invest it. Give teh money to real businesses, to building firms, manufacturing and technology firms. Start a space programme, build new towns, dismantle windfarms, build new roads and airports. Fix the leaks in the water pipes. Get people back to work on useful productive things. Stop teh ability of bankers to make billion dollar gambling losses with the people's productive cash.

'Where is the growth going to come from?'
Growth will come from a stimulation in demand and technological advances that increase productivity and deliver innovation. The time of teh elite's plan for green low growth should be ditched, it is time to help the people and humanity grow and time to end the suffering. Listen to the people, not the low growth elite. socialist, climate enthusiasts with their curbs on growth, technology and capitalist enterprise.

Instead of spending taxpayer money on workfare for people to stack shelves, open up govt funded companies that produce real goods - TVs, cheap laptops for every school child, pots and pans, knives and forks, all of the essentials. Employ people in real jobs, like the excellent Remploy does. Instead of workfare, how about a fair day's pay for a fair day's work, producing things that the country really needs. Shelf stacking can wait, in a time of low growth and crisis, shelf stacking is like arranging deck chairs on the Titanic.

Napoleon said the English were a nation of shopkeepers. Are we now to become a nation of shelf stackers? Surely we are capable of more than that? Has nobody get any better ideas than that? If that is all they can think of to create growth, no wonder some people are starting to pack their bags.

what claig said. 100% brilliant idea claig.

i'll have a think about the OP's question when I'm on the school run and post later...

So the idea is to reinflate a burst bubble?

Governments across Europe do not have the money to invest in major projects, and adding to debt - when UK has been accruing its highest ever peacetime borrowing in recent years just to meet the coalition's 'austerity' levels of spending seems unsustainable, and I doubt the money exists.

QE is essentially paid for by savers. About £18b so far in UK, and the biggest hit is on pensioners and those approaching retirement whose potential annuity is going be far lower than they may have hoped.

Shelf-stacking is how supermarkets replenish... valuable job. Would you prefer empty supermarkets?

Wind farms with no charm, shelf stacking and more sackings, taxpayer money blown on quantitative easing while old people can't afford heat and in winter are freezing. Is that what they mean by their slogan "creating a progressive future"? Has Orwell's newspeak and doublespeak taken over our media airwaves? Is there no one to say "the Progressive has no clothes"?

'So the idea is to reinflate a burst bubble?'

Isn't that what quantitative easing and bank bailouts were all about. There was no burst bubble in industries where people were productively making cars and other goods. The bubble was only in the speculative world of finance where bonuses spiralled, while billion dollar bets went bad. The world of derivatives and hedge funds, where some individuals were paid millions and were then bailed out by the hard working public when all their clever ruses flopped.

Stop reinflating the banker bubble, cut their bonuses, retract some of their banking licences if they can't operate without public subsidy.

Reinflate the real economy, the one where people work hard everyday without expenses for duck ponds and moat houses.

If we were really bust, we would stop foreign aid, we would stop spending on wars. we would not build new billion pound rail lines. Of course we are not bust. There is lots of money for quantitative easing and loaning to banks. Life goes on and the wheels of finance continue to turn. It is about where they decide to spend that money - in propping up bust banks or in investment in industry and the public good.

How much did the Jubilee cost the nation and how much do we pay the BBC presenters? We are not bust.

'Shelf-stacking is how supermarkets replenish... valuable job. Would you prefer empty supermarkets?'

For a valuable job like shelf stacking, I think supermarkets should pay at least the national minimum wage. I don't think government should be supplying people to supermarkets to do this valuable job for no pay. I think government should be creating new, real jobs and training people for them, rather than acting as a supplier of labour which is not even paid minimum wage.

I think the government should be developing plans for growth, and not for a growth in free labour.

And they call unemployed people who only want a future and question stacking shelves for free, "job snobs". These people who went to Eton and Oxford and studied PPE and don't know the price of a pasty, let alone a packet of peas.

We are no better than Europe and only the ability to print has saved us. I can,t help thinking osbornes latest scheme of fund to lend is a bank bail out by stealth.