Victory to the Greek people

[Coolfonz]

Some real politics going on in Athens...

Ain't about me.

Private banking runs the world. Politicians are just our errand boys.

Why do you think everyone who knows the game lines their pockets at any chance?

Tax schmax, the whole system is creaking, we fucked the system, now we want you to pay.

And you did! And you will.

Only the Greeks, so far, have the balls to fight. Good luck to them. You go bankrupt, the private banks don't get their money (like any creditor in a default situation) and Greece carries on...

Tsk 14...I wish!

Gotta go, spreadsheets to fill in...

Back later Mums n Dads...

Quite the little rebel working in investment banking I see.

Coolfonz

What next if Greece defaults?

It still needs to spend far more than it collects in tax. Who in their right mind would lend to them?

I actually think a default (or at least a restructuring) of their debt is inevitable - but that will be far worse for the Greek people than the bailout deal currently on the table.

Thankfully, we have the pound taking much of the pain for us. Still, if we don't sort out our own deficit this could all be happening here very soon.

Not wanting to indulge Coolfonz, but there have been some interesting comments on this thread.

Can anyone tell me why the Greeks are protesting, can't they see that their country is bankrupt?

Is it true that the poorest people are the ones shouldering the cost of cutbacks, while the rich are not?

The Germans will bail them out. Merkel will not let them take crash the Euro.

I've read several pieces by perfectly respectable economists who reckon Greece should have just defaulted. Argentina did it not so long ago and it's still there, society still functioning, world not fallen apart etc.

coolfonz do you have kids or have you just joined MN to lecture us? it always sounds a bit odd when people address us as mums and dads you see....

I think they should just default.

Brazil did, too, away back when.

Like Argentina, it's still there.

I'm not a fan of bailouts.

Either have capitalism or don't.

If they default they will have to leave the Euro. I don't know what that means for Greece or Europe.

The thing about Russia, Argentina, et al is that they weren't all linked in an unholy currency alliance.

With Greece, the problem isn't just a problem for them - it is a problem for the whole Eurozone (though I imagine German manufacturers are actually quite glad that the Greeks are smashing the Euro to bits).

There is a very serious risk of contagion. The world could easily handle Greece going down. Greece, Spain, Portugal and Italy? Probably not...

The problem with them defaulting is that it sets a precedent for the Eurozone.

Does that mean that any government can run up a huge deficit then default?

Oh, and by the way, unline Coolfonz, I don't consider riots and deaths to be real politics. I consider them to be a manifestation of the failure of politics.

From yesterday's Grauniad:

'The bottom line is that any country ending up in such distress will not find its prospects harmed much further by formally defaulting. Growth is affected ? but then, the debtor country is probably already in a slump. Sure, investors ask for more interest on any loans they extend to insolvent nations ? but only for a couple of years. The IMF researchers ask, "How long is the markets' memory?" ? and the answer appears to be: not long at all. This is not the conclusion of a bunch of pinko economists, but the global equivalent of a giant debt-counselling service, one that spends its time organising bailouts. No country would want to go bankrupt ? but once it is as good as bust, it may be more sensible to own up and manage the insolvency as fairly as possible.'

Based on the conclusions of this IMF paper.

People are confusing goverment debt with the actions of banks. The banking crisis isn't responsible for the Greek government's systemic overspending. It's merely that the worldwide recession means Greece can't grow themselves out of their overspending problems. And as their debt becomes more risky it becomes a more risky investment and therefore attracts a much higher rate of interest. So the protestors are making their countries problems worse. Directly.

It doesn't seem unreasonable to me that the Greeks are asked to retire at around the same age as Germans and Brits. But they are clearly very angry about it.

What do they want, has anyone asked them?

People are going to have to get rid of the notion that they can 'retire' at a relatively young age in respect of increasing life expectancies and expect the state to support them entirely whilst they develop increasinly expensive to treat health problems.

That is just not a sustainable paradigm for any society.

Well done Coolfonz - thread title made me smile.

MmeLindt - Agree. Default is possible for Greece. But impossible for EU to allow because of the example displayed to other struggling eurozone countries (Portugal, Ireland, Italy, Spain). Greece are worth a tiny amount of Eurozone GDP (2% from memory) so are not terribly significant on their own, but if the others follow suit? I think Greece will have to leave the Eurozone and then default.

hi, y i have kid(s).

growth is a utopian fantasy, it goes into pockets of a very few. UK had growth as high as 3pc/yr for a decade, where did it go? to the super rich and multi nationals and of course banks...

Leveraging debt: the very rich in any society can take on huge levels of debt. Eg: the US or in football Man Utd, it means smaller players have to take on more and more debt. when you get systemic failure that tends to fuck the smaller players, not the big ones who restructure.

Greece should nationalise its banks, so shd the UK have done. let the market take the toxic (ie: bad) debt, keep all the cash and assets...

Hang a few banking execs, job done...

For less robust economies the Eurozone has not been a big success. The other small EU countries outside the eurozone were allowed to go to the wall, and could start restructuring earlier. And obviously they could release some pressure by devaluing their currencies.

I can't see how Greece could stay in the Eurozone.

Eleloni How are you?

The best solution is definitely the breakup of the Eurozone - but that is politically impossible for the Eurocrats.

Sweeedes - it is more than raising the pension age and cutting holidays for public workers (they more than deserve that after so many years of having it easy)

The government want to cut state pensions - i am not sure what the average is, but my grandmother receives about 450-500 Euro a month for a widows pension. This is not a lot when you consider that there are no other benefits what so ever.

The average wage here in Greece is 700 Euro a month. It is impossible to pay rent/mortgage and to survive on this.

The cost of living is very high. Food is a lot more expensive than the UK. Petrol is currently at almost 1.60 a litre.
VAT is currently at 21% and is due to rise to 23% - this means prices will go up and wages down.
The average Greek just cannot survive like this and we do not know what to do.

The riots are just making everything worse though. The anger has been rising for so long and it has finally exploded.

I am fine and safe - i am in Corfu, not Athens.
Most my family however are in Athens so i am watching closely atm.
Thanks for asking

Elenio Sorry I cannot type.

Glad you are fine. Please, do keep us posted.

unfortunately we also have a huge amount of anarchists here in Greece who seem hellbent on burning Athens to the ground

That is interesting, Elenio.

So it is truly the poorest who are going to suffer most from the cut backs?

Hope your family in Athens are ok.