Greek debt crisis [update: 3rd Bailout deal reached]

[Thanas]

They took a 50% hit on their investment as well, or did you just completely forgot the haircut? And quit blaming Germany, it was a joint decision with every other European country in agreement, including Greece, and with the US supporting it.

And the US is now saying that Greece needs debt relief.

Ah, so the people you lambast for being wrong are now right once they agree with you. Right.

Yes; completely legal. Doesn't that give you some fucking pause? Doesn't it make you wonder how something so obviously wondrously corrupt could be so legal?

Hey, you live in the nation that is against banking reforms.

Bzzt. My argument for why debt restructuring/ relief/forgiveness should be given to Greece.

The fuck is this? I have said several times already that the current way of dealing with Greece's debt will be to turn it into the low-interest debt the ECB provides them with. You were the one saying there needs to be debt relief, now you accept restructuring as well? Have I convinced you? Oh glory day. Or is this just you weaselling out of it, which is usual for you?

Yes, Iceland raised taxes, but it also secured pensions, didn't cut the welfare state and has continued to raise minimum wage in the country to the point where it is currently now HIGHER than it has ever been in its history. Greece is being to mandated to raise taxes, CUT wages, CUT pensions, CUT the welfare state. So you want Greece to do what Iceland did?

No, I want them to do more, for Greece is in a much shittier situation than Iceland - one entirely out of their own making as well, one might add.

BTW, why should Latvia pay for Greece? Or Lithuania?

Poorer than Greece: the EU countries that reject a new Athens bailout

Half a continent away from Athens, Milda is unimpressed. Watching reports of the Greek predicament on the news, the Latvian pensioner has little sympathy for her counterparts 1,800 miles to the south.

“Can’t they get by on €120 a week?” she asks, referring to the latest cash limits on pensioners introduced in Greece. “Life’s less expensive down there. It’s warmer, they don’t have to pay for heating or winter boots, and fruit and vegetables must be cheaper.

“Anyway, if they borrowed all that money, they should pay it back, that’s the way I see it.”

Europe’s great Greek crisis is often cast as the downtrodden Hellenic heroes versus the ubermasters of austerity in Berlin. In reality, however, it is smaller nations that have faced crisis themselves, swallowed the austerity medicine and lived to tell the tale who are most hostile to another bailout for Athens.

From central European minnows such as Slovakia to Baltic eurozone republics such as Latvia and Lithuania, hard-pressed pensioners and workers earning barely €500 a month are at a loss as to why Greece should qualify for more largesse.

Milda’s monthly pension is €293 a month , well under half the current level in Greece. When Latvia went through a similar debt crisis in 2009, it imposed swingeing budget cuts and tax increases worth about 15% of GDP over three years. Output fell by a quarter and unemployment soared to more than 20%. The population fell as people left in droves.

These measures were hugely controversial at the time, and many people thought they would lead to catastrophe. The US economist Paul Krugman predicted at the end of 2008: “Latvia is the new Argentina.”

By the second half of 2010, however, the economy had started to grow again, and from 2011 to 2013 Latvia was among the fastest growing countries in the EU. Despite the fact that the currency was not devalued, exports are now at record highs, some 60% above where they were before the crisis.

So in Latvia there is a widespread view: “If we did it, why can’t the Greeks?” The country’s finance minister, Jānis Reirs, said recently that “the Latvian people don’t understand the Greek people”. Milda exemplifies that.

In next-door Lithuania, politicians are also struggle to tell their electorate why a country that tightened its belt should now pay for one that will not. Lithuania’s president, Dalia Grybauskaitė, has been one of the most outspoken opponents at EU summits of doling out more cash to Greece.

The average monthly pension in Lithuania is €242.10 before tax, compared with €700 in Greece. The average wage in Lithuania is €699.80 before tax and €543.60 after, again way below the Greek average.

Average unemployment benefits come in at about €175. Such figures illustrate why the Lithuanian people have little sympathy for the Greeks.

Rimantas Šadžius, the Lithuanian finance minister, said further support for Greece “would not be a popular decision” in the Baltic state. “We wouldn not receive an enthusiastic support, especially if we ask for the public opinion,” he said.

“We express solidarity even if financial aid is needed by a wealthier or more economically developed eurozone country,” he said. “We agree to take part in the aid’s mechanisms, since financial stability in the eurozone is a common benefit we should all preserve.

“However, we strictly emphasise that solidarity cannot be a one-way relationship. I mean that the country willing to receive our help must be ready to comply with its obligations, fully and in time.

“Greece is at a crossroads. One path, to be honest, leads to an economical abyss. The other one is much more complicated, but it does present a possibility to solve the current economical problems while remaining in the eurozone. With the eurozone’s assistance, of course,” Šadžius said.

Some Lithuanian politicians worry that the current crisis might send Greece into Russia’s sphere of influence , but Šadžius said such concerns were premature.

“Theoretically, one can discuss such questions, though it’s more of a topic for political scientists. So far, at least in the discussions of the ministers of finance, Greece hasn’t played this card once,” he said.

No country is homogenous, and there are people in the Baltic states who feel Greece’s pain. Ignatas Goštautas, a young middle-class man, said that although Greek wages and benefits were way above Lithuanian levels, recent cuts in Greece had taken their toll.

“We should contribute somewhat, in solidarity, but the Greeks shouldn’t be so arrogant about it,” Goštautas said. “They suffered cuts from a higher level, and these cuts had to be painful. It’s hard to help someone when you’re not in a good situation yourself, but some solidarity should be maintained by the EU.”

Valentinas Mazuronis, an MEP and head of the Labour party, one of the members of the current coalition, said Lithuania should not give any money to Greece.

“It is time to say ‘stop’. Not a single penny to Greece until reforms are actually launched,” he said. Further aid should only be granted if Greece takes real measures instead of “another hocus-pocus”.

Currently travelling so I don't have much time:

Don't stay away for too long, this thread will get boring without your thoughtful posts comedy act.

Hey now, writing comedy and other literature is your people's work.
I mean, it is the most successful export in Greece's history.
Too bad that most of it is like Greece - outdated, old, and in need of reforms to be able to keep up with modern stuff.

[Thanas]

The Greek government capitulated on Thursday to demands from its creditors for severe austerity measures in return for a modest debt write-off [Correction: No such debt write-off was requested], raising hopes that a rescue deal could be signed at an emergency meeting of EU leaders on Sunday.

Athens is understood to have put forward a package of reforms and public spending cuts worth €13bn (£9.3bn) to secure a third bailout from creditors that could raise $50bn and allow it to stay inside the currency union.

A cabinet meeting signed off the reform package after ministers agreed that the dire state of the economy and the debilitating closure of the country’s banks meant it had no option but to agree to almost all the creditors terms.

Parliament is expected to endorse the package after a frantic few days of negotiation that followed a landmark referendum last Sunday in which Greek voters backed the radical leftist Syriza government’s call for debt relief.

Syriza, which is in coalition with the rightwing populist Independent party, is expected to meet huge opposition from within its own ranks and from trade unions and youth groups that viewed the referendum as a vote against any austerity.

Reactions:

This looks v similar to the 26th June draft plan. The one voted down in the referendum.
Basically: Syriza get presented with 26th June plan, call referendum, win referendum, Creditors hit back with "deal or Grexit", Greeks fold.

So the idiot who turned down a 9bn austerity plan now has proposed a 13bn austerity plan. Great negotiating strategy there. Full list of what Tsipras is proposing here

And in the meantime, he caused this: http://blogs.afp.com/correspondent/?pos ... crying-man.
Though at least that one had a semi-happy ending, it still should not have happened in the first place. A nation that causes their elderly to weep on the streets....disgusting. Poor man.

[Zixinus]

And in the meantime, he caused this: http://blogs.afp.com/correspondent/?pos ... crying-man.

It would be (probably will be in some way) argued that this is merely another effect of the recession that has been stretched decade-long due to austerity measures and this was just the shadow of the doom-hammer that hung over the entire country to cow them continuing the very same thing.

So the EU is giving Greece a massive loan again, demanding reforms again hoping while complaining how all the previous ones weren't truly followed and hoping that this time they will be.

Time will tell who will be right, right now I'm mostly seeing two conflicting narratives that I don't have the economics knowledge to tell who is right and who is wrong. In the meantime, average citizens will continue to suffer for the decisions done by a wealthy elite, politicians and EU bureaucrats.

[Tribble]

If the EU is stupid enough to give the Greeks another loan, they shouldn't complain when the Greeks inevitably fail to follow the conditions. This is just kicking the can down the road yet again.

[Thanas]

If the EU is stupid enough to give the Greeks another loan, they shouldn't complain when the Greeks inevitably fail to follow the conditions. This is just kicking the can down the road yet again.

The EU can't win, really. Kick them out and it gets blamed for being inhuman and ignoring their suffering, loaning them money again and they get blamed for demanding cuts and ignoring their suffering while also being dumb.

[His Divine Shadow]

Well austerity is dumb and inhumane both at the same time. Really greece would be best off outside the euro, as would we for that matter in the long run.

[BabelHuber]

Well austerity is dumb and inhumane both at the same time.

Austerity is only dumb when a country with a healthy economy goes through a recession. But the second part of this Keynesian theory is that the public dept has to be reduced during times with growth - a point which is ignored most of the time by nearly all governments.

However, if a country with a weak economy goes bancrupt because of irresponsible overspending, only an imbecile could think that things get better by continuing the overspending habits.

Really greece would be best off outside the euro, as would we for that matter in the long run.

I agree with this one.

[FTeik]

I have to quote this again, because I wasn't allowed to edit;

And Germany paid for that: with twelve million of its people dead, a QUARTER of its former territory lost, its heavy industry, that wasn't destroyed dismanteled for reparations (the Brits were responsible for (not) distributing the greek share), a separation of the remaining country (overcoming that cost 1,000 billion € so far and still isn't complete) in two parts and occupation for four decades, so don't say the country got off easily in 1953.

Yes Germany suffered because of its actions in WW2 genius; but so did every fucking country on the continent you dumb cunt. I can't believe you typed that.

No shit, Sherlock. From the way you argued one could have assumed, that Germnay only amassed massive debt and was graciously forgiven by the Allies (without a complete remodelling of its political structure).

And since you mentioned the suffering by "every fucking country on the continent", thank you for pointing that out. There are countries, that suffered more than Greece and longer than Greece (I'm looking at the Eastern European States here), but for some reason they are not in the same shit as Greece. One has to wonder why.

Greece engaged in completely legal derivative swaps with banks; who the FUCK suffered until such time as the German government decided to go neoliberal and socialise the banks losses. LIKE SERIOUSLY; what the fuck is the matter with you? The banks should have taken a hit on their investment, it happens all the fucking time, but not with the neoliberal agenda any more; 'privatise profits and socialise losses', that's the ticket.

a) And this changes the fact, that the Greeks loaned more money than they should have and pissed it away how?
b) Only, that there wasn't the threat of "just a hit" in 2010. Yeah, right, lets ignore that banks have to keep other people supplied with money and loans, too, aside from the Greeks. Also they are intermediaries between savers and debtors. "Oh, sorry Mister, you can forget your pension-plan, because we had to write off the money for Greece." "Apologizes Madam, but the saving-plan for your childrens study at university went up in smoke.

[FTeik]

[quote= ”K.A.Pital”]
Actually, all the politicians were corrupt bank bootlickers with ties to Goldman Sachs. That is the real story of 2010.[/quote]

Well, then the solution is obvious. Lets sue Goldman Sachs.

[quote= "K.A.Pital”]
And I should say a student calling Krugman an idiot looks like an idiot himself...[/quote]

Considering, that there are also economists, who say the complete opposite of Krugman and also considering, that all the Nobelprizes for economy, that went to the USA didn’t help them prevent the crisis of 2008 I wouldn’t put to much weight on Krugman or the anglosaxon school of economy in general. Neo-liberalism and deregulation of the banks wasn’t a middle European invention after all. Germany and other countries followed, because they didn’t want to be left behind in the money-making (and just look at the troubles the DeutscheBank is now in).

[quote= ”Irbis”]
This is typical: Most bailouts (for instance, the Mexican bailout) are not bailouts of the country but of the Western banks who didn't do adequate due diligence. It could be nice that the German and other European governments bailed out their banks (though whether that is good policy is another matter); but the Greeks rightly asked, why it should be done so much on their backs.[/quote]

Because it was Greeks, who incurred the debt by the banks in the first place, Greeks, who spent the money lent to them in the first place and promised to pay back the money. The way this Stiglitz argues one would think, that the banks took the money, burnt it in the chimney and then threw a dart at a map saying “alright, we’ll ask our money back from the country hit”.

[quote= ”Irbis”]
Now, even the IMF is calling for deep debt restructuring. There are many ways this can be done: lengthening the time over which loans have to be paid back, lowering interest rates, or even writing off some of the debt or converting some of the debt into GDP-linked bonds, which would pay more if Greece recovered. This would align the interests of Greece and its creditors in getting a quick return to growth. [/quote]

Much of this was already done, lIRC.

[quote= ”Irbis”]
Quote:
'Why Germany Wants Rid of Greece'

When I recently visited Berlin, it quickly became clear the extent to which Germany had created a fantasy story about Greece. It was an image of Greeks as a privileged and lazy people, who kept on taking ‘bailouts’ while refusing to do anything to correct their situation. I heard this fantasy from talking to people who were otherwise well informed and knowledgeable about economics.

So powerful has this fantasy become, it is now driving German policy (and policy in a few other countries as well) in totally irrational ways. In particular, Germany refuses to discuss debt relief with Greece, yet seems quite happy to see Greece leave the Eurozone, the inevitable consequence of which would be that Greece would obtain much greater debt relief through default. Talk about cutting off your nose to spite your face. What is driving Germany’s desperate need to rid itself of the Greek problem?

One possible answer is that Germany finds the truth about Greece too upsetting, too challenging. This is because since 2010 Greece has done most of what the Troika asked of it. In particular, changes in its government’s underlying primary budget balance (i.e. the degree of austerity enacted) have been greater, by a long distance, than any other European economy. For many outside Germany what has happened to Greece as a result is hardly surprising: austerity is contractionary, and austerity on steroids is ruinous. Yet Germany is a country where the ideas of Keynes, and therefore mainstream macroeconomics in the rest of the world, are considered profoundly wrong and are described as ‘Anglo-Saxon economics’. Greece then becomes a kind of experiment to see which is right: the German view, or ‘Anglo-Saxon economics’.

The results of the experiment are not to Germany’s liking. Just as ‘Anglo-Saxon economics’ would have predicted, the results for Greece under the Troika have been a disaster. After dutifully taking the medicine for years, and seeing the collapse of their economy, finally the Greek people could take no more. Confronting this reality has been too much for Germany. So instead it has created its fantasy, a fantasy that allows it to cast its failed experiment to one side, blaming the character of the patient.

The only thing particularly German about this process is the minority status of Keynesian economics within German economic policy advice. In the past I have drawn parallels between what is going on here and the much more universal tendency for poverty to be explained in terms of the personal failings of the poor. These attempts to deflect criticism of economic systems are encouraged by political interests and a media that supports them, as we are currently seeing in the UK. So much easier to pretend that the problems of Greece lie with its people, or culture, or politicians, or its resistance to particular ‘structural reforms’, than to admit that Greece’s real problem is of your making.
[/quote]

Funny, no word about the working of austerity in Portugal, Spain, Ireland, the Easter European Countries or that Greece had a budget-surplus and some growth towards the end of 2014, before Syriza came into power and pissed everything away.

It is also dishonest to blame the Germans for the debts the Greek assembled in the first place, as if the Greeks are retards, who were tricked into debt or forced at gun-point to spend more money, than they earned.

There is more I have to say, but that will have to wait until I have more time.

[Crown]

[youtube] <snip > [/youtube]

Err ... Thanas ... why did you post that?

You realise I linked the speech in my previous post ... right? Oh well, I guess this gives me an opportunity to talk about Guy Verhofstadt.

Guy Verhofstadt is a Belgian MEP and form Belgian PM. Here he is seen passionately urging Greek PM Alexis Tsipras to 'push forward reforms' and 'modernise' Greece and to 'privatise' Greece ... isn't that nice of him? It's not as if Guy is a board member of Belgian investment firm Sofina is it? And it's not like Sofina has a 37% share share in a company called Suez Environment as of December 2014 is it? And it's not as if Suez Environment is trying to get a bite in the privatisation cherry in Greece, specifically Thessaloniki's (Greece's second largest city) water supply is it? Because if all that were true, then pretty much everything that Mr Verhofstadt just said, looking through the prism of his corporate activities would be nothing more than a self serving money grab.

Well done Thanas. *slow clap* You want Greece to trade their elite oligarchy ruling class for a pan-European one. Well fucking done. *slow clap*

Ah, so the people you lambast for being wrong are now right once they agree with you. Right.

As I said, rational people allow the facts to change their minds.

Hey, you live in the nation that is against banking reforms.

They were completely legal on a European level you dumb cunt.

Bzzt. My argument for why debt restructuring/ relief/forgiveness should be given to Greece.

The fuck is this? I have said several times already that the current way of dealing with Greece's debt will be to turn it into the low-interest debt the ECB provides them with. You were the one saying there needs to be debt relief, now you accept restructuring as well? Have I convinced you? Oh glory day. Or is this just you weaselling out of it, which is usual for you?

The ECB loans are +4% interest. What you're thinking of is the EFSF/ESM, which coincidently means you're agreeing with Tsakalotos and Varoufakis; that the high interest ECB loans should be bought out by the ESFS/ESM ... so which one of us is convincing who? Which one of us is weaselling out of what?

I don't believe restructuring is enough; I believe debt forgiveness is necessary, however ANY reform without restructuring is meaningless, the numbers simply don't support it.

Yes, Iceland raised taxes, but it also secured pensions, didn't cut the welfare state and has continued to raise minimum wage in the country to the point where it is currently now HIGHER than it has ever been in its history. Greece is being to mandated to raise taxes, CUT wages, CUT pensions, CUT the welfare state. So you want Greece to do what Iceland did?

No, I want them to do more, for Greece is in a much shittier situation than Iceland - one entirely out of their own making as well, one might add.

There you go again, moralising. Germany was also in a much shittier situation ... remind me what happened there, oh yes 60% DEBT WRITE OFF. Silly me.

Once again; YOU claimed that austerity worked for Iceland. The ONLY thing that Iceland is doing that can be construed as 'austerity' is running a balanced budget. Everything else is clearly socialist. Greece is running a balanced budget too ... if you exclude debt repayments. What did Iceland do with its debts again? Oh look, I think we've stumbled upon a solution ...

BTW, why should Latvia pay for Greece? Or Lithuania?

Poorer than Greece: the EU countries that reject a new Athens bailout

<snip>

I'm sorry, I don't have an article of why countries poorer than Germany should reject their debt write off back in 1953, so instead I'll post a picture of the Greek finance minister in the 1953 London conference signing off on a 60% German debt forgiveness.



Yes, of course governments poorer than Greece are going to get pissed off at this, I understand it. But they need to be serious, there is no point continuing the cycle of bailout/loan payment cycle.

Hey now, writing comedy and other literature is your people's work.
I mean, it is the most successful export in Greece's history.
Too bad that most of it is like Greece - outdated, old, and in need of reforms to be able to keep up with modern stuff.

+1 for effort, -2 for being clunky.

[Crown]

I have to quote this again, because I wasn't allowed to edit;
Yes Germany suffered because of its actions in WW2 genius; but so did every fucking country on the continent you dumb cunt. I can't believe you typed that.

No shit, Sherlock. From the way you argued one could have assumed, that Germnay only amassed massive debt and was graciously forgiven by the Allies (without a complete remodelling of its political structure).

No one could have assumed that. Wait, let me amend; no one WITH A BRAIN could have assumed that. But you didn't answer my question asshat;

Cool story bro. Remind me again of how the German economic miracle was sparked? Was it A) crushing and senseless austerity or B) HUGE FUCKING DEBT FORGIVENESS.

Answers on the back of a postcard, ta. o/

And since you mentioned the suffering by "every fucking country on the continent", thank you for pointing that out. There are countries, that suffered more than Greece and longer than Greece (I'm looking at the Eastern European States here), but for some reason they are not in the same shit as Greece. One has to wonder why.

I know right, it's not like THEY HAD THEIR OWN CURRENCIES WHILE THEY WERE ENACTING REFORMS OR ANYTHING? RIGHT?

You also understand that Greece hasn't CAUSED THEM TO SUFFER, right?

You understand that THE POINT of the German example; is that if we can all forgive Germany for fucking us, why can't you forgive Greece for fucking its self? You seem to think that Greece should be 'made to pay' due to some kind of 'morality' issue. I'm telling you; you can't get blood from a stone. Learn from history, the only way this ends with a win-win if the debt is restructured/forgiven, or it will be more of the same.

a) And this changes the fact, that the Greeks loaned more money than they should have and pissed it away how?

b) Only, that there wasn't the threat of "just a hit" in 2010. Yeah, right, lets ignore that banks have to keep other people supplied with money and loans, too, aside from the Greeks. Also they are intermediaries between savers and debtors. "Oh, sorry Mister, you can forget your pension-plan, because we had to write off the money for Greece." "Apologizes Madam, but the saving-plan for your childrens study at university went up in smoke.

WELCOME TO CAPITALISM BRO. Again; it happens ALL THE GOD DAMNED TIME.

[Welf]

BTW, why should Latvia pay for Greece? Or Lithuania?

The more money Greece transfers to debtors, the less it has for investment and social spending. The former erodes the capital basis, the latter the intellectual basis with all the good people leaving. This in turn means less growth and less ability to make payments.
Basically, it is better for them to forfeit a part of the money than lose all by killing the Greek economy.

[aerius]

In this topic, we learn who passed middle school math. Anyone who passed can easily punch the numbers into a spreadsheet and realize that the "bailout" loans made to Greece back in 2010 were unpayable at the time they were made, a simple check of loan size, interest rate, and projected growth rate would've told you that. So various parties made loans to a country which they knew couldn't pay them back, ever, and now they're crying that they've lost their money and bringing up all sorts of moral and legal shit to justify their decision. Oh by the way, do you know what it's called when you deliberately lend money to a party who you know can't repay the loan, and with the intent of asset stripping said party? That is predatory lending, which by the way is illegal, and voids the loan obligations. And if you believe that the parties who made those loans didn't know that, I've got some ocean front property to sell you. In Utah.

[Edi]

BTW, why should Latvia pay for Greece? Or Lithuania?

The more money Greece transfers to debtors, the less it has for investment and social spending. The former erodes the capital basis, the latter the intellectual basis with all the good people leaving. This in turn means less growth and less ability to make payments.
Basically, it is better for them to forfeit a part of the money than lose all by killing the Greek economy.

Greece

1. has a dysfunctional and inefficient census bureau
2. has a dysfunctional and inefficient real estate registry (of land, buildings etc. etc.)
3. has a dysfunctional and inefficient taxation office and tax laws are not really enforced
4. is unwilling to reform the census bureau
5. is unwilling to reform the real estate registry
6. is unwilling to reform the tax office
7. is unwilling to enforce taxation
8. has a yearly budget of about 80 billion euros
9. has a tax evasion problem of between 10 to 25 billion euros per year

Items #1, #2 and #3 on that list are requirements for cutting down tax evasion and actually collecting the taxes that have been set down in the laws. Without that, there is no use for Paul Krugman and many of the others who have been howling about austerity to whine about how Greece has high taxes and whatever. As long as items #4-6 are the prevailing state of affairs, there is never going to be any chance of the situation in Greece improving in any measurable regard.

It doesn't help that the national attitude in Greece, shared by well over 60% of the population, is that taxes are theft from the populace and that tax evasion is more or less a civic duty. As is mooching as much off the government as possible, through whatever means. Just googling the ways the systems are abused makes for some fucking eye-opening reading. The tax evasion is particularly bad in the tourist areas such as the islands, less so in some of the bigger cities, but it is still really fucking prevalent. And still there is the expectation that the EU should pay for their shit.

Let's see if they now choose to do any of the actual meaningful reforms to fix the census, real estate registry and tax offices and start enforcing their laws. If they do, that alone will go a long way toward relieving the situation. But if they keep going on as they have for the past years, or try another round of bullshit like this latest one, there won't be a fourth round of relief. It won't be politically feasible in several different countries at that point, at which point Greece WILL be left to sink or swim on its own.

[Starglider]

It doesn't help that the national attitude in Greece, shared by well over 60% of the population, is that taxes are theft from the populace and that tax evasion is more or less a civic duty.

That would not be so bad if they didn't also insist on a massive state sector, comparatively high military spending and generous welfare state.

The traditional way to square this circle was to indirectly tax the entire economy via printing drachmas (inflation rate was between 10% and 30% from the mid 70s to the mid 90s). Of course, the Germans won't let them print euros. Evil Germany, everything could be 'fixed' if you just let all those needy beurecrats monetise to the moon. Keynes would approve, alledgedly.

[LaCroix]

It's the same general opinion here in Austria - we know that we won't see the money we gave them again. But we'll only let them off the hook if the Greeks fix their structural problems, first.

Right now, the moment we forgive their debts, they will happily return to their old habits, lending like the sun king, and we have no leverage to stop them from doing so. In ten years, they will be right back at where they are now, crying for bailouts.

So they first have to prove that they are off their bad habits, and create a system that could sustain itself if their debt was gone, before we let bygones be bygones.

[Fingolfin_Noldor]

The best way forward I suspect is to phase in the forgiving of the debts.

[Crown]

In this topic, we learn who passed middle school math. Anyone who passed can easily punch the numbers into a spreadsheet and realize that the "bailout" loans made to Greece back in 2010 were unpayable at the time they were made, a simple check of loan size, interest rate, and projected growth rate would've told you that. So various parties made loans to a country which they knew couldn't pay them back, ever, and now they're crying that they've lost their money and bringing up all sorts of moral and legal shit to justify their decision. Oh by the way, do you know what it's called when you deliberately lend money to a party who you know can't repay the loan, and with the intent of asset stripping said party? That is predatory lending, which by the way is illegal, and voids the loan obligations. And if you believe that the parties who made those loans didn't know that, I've got some ocean front property to sell you. In Utah.

The irony of you posting the fact that the MATHS never added up for this absurdity, and the next three posts below you running the 'lazy Greek' meme.

I have never known logic (outside of fundy thinking) to be so immune to empirical data.

So they first have to prove that they are off their bad habits, and create a system that could sustain itself if their debt was gone, before we let bygones be bygones.

How did we know that the German's ever learned to not stick people in ovens before we forgave their debts? Just think about how fucking condescending that was.

Oh, and for the umpteenth time; they are (were before Grexit meant people started running their money out of Greece) running a budget surplus if you exclude debt repayments.

[Crown]

I can't edit, so this goes here, from here;



Fucking Greeks ... about to tie Germany (it includes Prussia) and Austria for number of bankruptcies since 1800 ... can't they just do better?

[J]

This video needs to be posted again.


People need to realize that the money was never there to begin with, the money isn't there now, and, barring an act of God, it will not be there in the future.
All that's being argued now is who gets to hold the empty bags. And there shall be many empty bags.
All the moralizing and finger pointing in the world won't fill those bags with anything other than hot air.

[Crown]

This video needs to be posted again.


People need to realize that the money was never there to begin with, the money isn't there now, and, barring an act of God, it will not be there in the future.
All that's being argued now is who gets to hold the empty bags. And there shall be many empty bags.
All the moralizing and finger pointing in the world won't fill those bags with anything other than hot air.

Hey J how many bets on derivatives is Deutsche Bank still sitting on now?

[Simon_Jester]

They took a 50% hit on their investment as well, or did you just completely forgot the haircut? And quit blaming Germany, it was a joint decision with every other European country in agreement, including Greece, and with the US supporting it.

And the US is now saying that Greece needs debt relief.

Ah, so the people you lambast for being wrong are now right once they agree with you. Right.

Has Crown lambasted the US government for being wrong on this issue? When? Where?

“Can’t they get by on €120 a week?” she asks, referring to the latest cash limits on pensioners introduced in Greece. “Life’s less expensive down there. It’s warmer, they don’t have to pay for heating or winter boots, and fruit and vegetables must be cheaper.

“Anyway, if they borrowed all that money, they should pay it back, that’s the way I see it.”

Europe’s great Greek crisis is often cast as the downtrodden Hellenic heroes versus the ubermasters of austerity in Berlin. In reality, however, it is smaller nations that have faced crisis themselves, swallowed the austerity medicine and lived to tell the tale who are most hostile to another bailout for Athens.

I'm reminded of rural Americans who vote Republican because they can't believe that the (alleged) welfare queens in inner cities are getting such amazing, massive checks from the federal government, with their hard-earned tax dollars that they shouldn't have to pay in the first place because taxes, dammit!

Are red states really suffering to fund welfare for damnlibruls? No, but it makes good press.

Milda’s monthly pension is €293 a month , well under half the current level in Greece. When Latvia went through a similar debt crisis in 2009, it imposed swingeing budget cuts and tax increases worth about 15% of GDP over three years. Output fell by a quarter and unemployment soared to more than 20%. The population fell as people left in droves.

These measures were hugely controversial at the time, and many people thought they would lead to catastrophe. The US economist Paul Krugman predicted at the end of 2008: “Latvia is the new Argentina.”

By the second half of 2010, however, the economy had started to grow again, and from 2011 to 2013 Latvia was among the fastest growing countries in the EU. Despite the fact that the currency was not devalued, exports are now at record highs, some 60% above where they were before the crisis.

Others argued earlier in this very thread, that this has a lot to do with all those Latvians who left the country and started working as migrant laborers elsewhere. Did you disagree with them?

Because if you don't disagree with them, and think Latvia DID manage to reboot its economy thanks to currency brought in by migrant workers... Do you think that's a practical solution for Greece? Not do the Latvians think so, do you think so?

If you do think so, then say so rather than implicitly presenting that view by quoting someone else's article on what yet another bunch of people are thinking.

If you don't think so, then is it even relevant that the Latvians think the Greeks should 'just' solve their problem Latvia-style, when Latvia-style solutions won't solve the problem in the first place?

Reactions:

This looks v similar to the 26th June draft plan. The one voted down in the referendum.
Basically: Syriza get presented with 26th June plan, call referendum, win referendum, Creditors hit back with "deal or Grexit", Greeks fold.

So the idiot who turned down a 9bn austerity plan now has proposed a 13bn austerity plan. Great negotiating strategy there. Full list of what Tsipras is proposing here

And in the meantime, he caused this: http://blogs.afp.com/correspondent/?pos ... crying-man... A nation that causes their elderly to weep on the streets....disgusting. Poor man.

Spectacularly bad negotiating strategy. I would think Tsipras should have resolved to stick to his negotiating position no matter what, or had a different position, the situation is too serious for gamesmanship and pretending to want X to improve your negotiating position for Y. Especially after a referendum endorses your position.

I will note, though, that Greek old men are going to be crying whether or not the Greeks comply with instructions from the IMF or Brussels or Berlin. The economic situation is simply that bad; there is no good solution. Any more than there is a good solution for all those American families who took out mortgages in 2005-2007 during a real estate bubble, were assured by their lenders that housing prices would continue to increase. And whose loans were often robosigned with no oversight or sanity checks on the part of the bank.

And who are now dealing with underwater mortgages so that they have to pour thousands or hundreds of thousands of dollars into a pit that will never repay them, for the privilege of not being thrown out of their homes.

If you're going to blame the borrower for that situation, you can't turn around and also blame the group that opposed the borrower at the time, for the mere fact that there are bad economic consequences. It's like saying, "The husband signed the huge, unsustainable mortgage, the wife opposed it and thought he was reckless and feckless, but he signed it anyway. The wife is now running the family finances so it's HER fault Grandpa can't get the new dentures he needs!"
_________________________

Now, you can legitimately blame the current Greek government for the way they're handling the negotiations, because it's foolish and frivolous and cowardly to say 'no, we will not enact austerity,' send out a referendum that affirms not enacting austerity, and then enact austerity anyway as soon as someone predictably threatens "austerity or Grexit."

But if the crude reality is that the Greek economy is too small to ever repay these loans... that's not going to change.

And if we talk about reforming the taxation system and so on- wait a minute. The money is already bleeding out of the Greek economy rapidly. Their GDP has shrunk massively. Taxing it more efficiently isn't going to make that shrinking process stop; if anything it might do the opposite. So while it might mean the Greeks have more euros to pay off loan interest in 2016 or 2017, it isn't automatically going to fix the problem that they're dealing with more loans than their small and badly damaged economy can maintain.

So this still reduces to a case of "squeeze the Greeks for as much money as possible, and demand that they cooperate in the squeezing."

The Greeks really have no incentive to comply with any request from outside their own country, if it's coming from people whose mindset is "squeeze the Greeks." It's like, sure, the wolf may be giving you good advice that is to your benefit... but there's no reason to assume so, when the wolf probably thinks of you as a meal and not as a friend.

[His Divine Shadow]

Mmmm so the EU is a like econo-sexual predator fiddling the little countries to strip them of their worth and trap them in eternal purgatories.

[FTeik]

I have to quote this again, because I wasn't allowed to edit;
Yes Germany suffered because of its actions in WW2 genius; but so did every fucking country on the continent you dumb cunt. I can't believe you typed that.

No shit, Sherlock. From the way you argued one could have assumed, that Germnay only amassed massive debt and was graciously forgiven by the Allies (without a complete remodelling of its political structure).

No one could have assumed that. Wait, let me amend; no one WITH A BRAIN could have assumed that. But you didn't answer my question asshat;

Could have fooled me, especially when you simplify your argument like this (didn’t notice this the first time, I was already answering to your following post):

Cool story bro. Remind me again of how the German economic miracle was sparked? Was it A) crushing and senseless austerity or B) HUGE FUCKING DEBT FORGIVENESS.

You are also forgetting, that there WAS debt-forgiveness in 2012 by 100 billion https://en.wikipedia.org/wiki/Second_Ec ... for_Greece , which would amount to fifty percent of the then existing debt.

If I now lock at the debt-agreement from 1953 https://en.wikipedia.org/wiki/London_Ag ... rnal_Debts I can see, that Germany got – drolls rum – also debt-relief by 50 percent.

Explain to me, how a huge fucking debt-forgiveness of 50% for Germany is different from a huge fucking debt-forgiveness of 50% for Greece? Aside from that, contrary to Greece today (see below), I’m willing to bet, that the German negotiators of 1953 were negotiating in good faith, instead of annoying them with the kind of escapades Syriza pulled since coming to power.

I know right, it's not like THEY HAD THEIR OWN CURRENCIES WHILE THEY WERE ENACTING REFORMS OR ANYTHING? RIGHT?

Well, if Greece wouldn’t have swindled itself into the Euro, it would have had to keep its own currency, too and would have had to pay double-digit interests for its credits. Since it didn’t have to do that Greece could cheaply borrow money until it was in over its head in debt.

You also understand that Greece hasn't CAUSED THEM TO SUFFER, right?

No, Greece caused its own suffering, by amounting more debt than it could ever pay back:

- They swindled themselves into the Euro
- Despite not being ready for the Euro (Maastricht-criteria), they were granted access on the optimistic assumption, that the Greek government would move the country towards more compliance with the agreed upon criteria, when in reality the opposite was the case.
- Now when the bubble burst and the excrements hit the fan they receive emergency-loans, a haircut of 100 billion dollars, offers of help in modernizing their tax-system http://www.reuters.com/article/2012/02/ ... BA20120219 , ect.

In return they agreed to a number of reforms and while I have no doubt, that the “easy” ones – cutting pensions and wages (it should however also be noted, that from 2001-2008 the average wage in Greece rose by 40%), reducing the employment in the public sector, there seem to have been no structural reforms in regards to the tax-system or land-register, that are also enforced (and not just codified into law).
One is tempted to quote Bismark: “You can run a state with bad laws, if you have good officials, but the best laws are useless, if the officials are bad.”
When Syriza came into power, many of those reforms were cancelled and when the Troika travelled to Athens in February 2015, they weren’t allowed access to the information they demanded. Instead we get a cat-and-mouse-game for the last months, in which the Greeks manage to piss away any remaining good-will their creditors might have still had. Then they pull that stunt with the referendum about the reforms and austerity and a few days later Tsipras presents a list, which seems to contain everything and more he opposed until then. He is either lying to the creditors or he is lying to his own electorare.
Not only that, considering what Tsipras is currently offering for a third package, one also has to wonder, what has actually been done reform-wise since 2010. It can’t have been much, if there is still room for more. So if the Greeks didn’t follow through on their agreements then, why should we trust them to do so now?

Considering all this answer honestly: How credibly are such figures?

You understand that THE POINT of the German example; is that if we can all forgive Germany for fucking us, why can't you forgive Greece for fucking its self? You seem to think that Greece should be 'made to pay' due to some kind of 'morality' issue. I'm telling you; you can't get blood from a stone. Learn from history, the only way this ends with a win-win if the debt is restructured/forgiven, or it will be more of the same.

This isn’t about a debt-cut alone, despite the problems that would cause forthe Euro-zone and the reaction of other members with huge debts (which you would now, if you’d r ead my earlier posts from my discussion with K.A.Pital), this is also about trust and negotiating in good faith, which Syriza and the previous Greek governments squandered away.

WELCOME TO CAPITALISM BRO. Again; it happens ALL THE GOD DAMNED TIME.

Right, and now it happened to Greece. Tough luck, but as you said, It happens all the god damned time.

[FTeik]

I can't edit, so this goes here, from here;



Fucking Greeks ... about to tie Germany (it includes Prussia) and Austria for number of bankruptcies since 1800 ... can't they just do better?

Well, three of those were for Prussia alone (and two of them because of the wars against Napoleon), so if you want to count for the whole of Germany, you'd have to start in 1871 (while Greek got its independance from the OttomanEmpire in 1822).