“ransos – while that may have contributed to some extent do you not think its still the fault of the Greek gov ?”

Partly, but if you were a bank, would you give a £200k mortgage to someone on the minimum wage? It’s a general point that those lending money to people who may not be able to pay it back, in the hope of making a quick buck, should carry the risk if it goes wrong.

Interesting article in the financial pages of the Guardian

Alice in Wonderland Economics

Just pointing out what most people knew. The single currency was never going to work. Germany looking to southern Europe for somewhere to invest its enormous trade surplus, fueled a totally unsustainable and unrepayable debt bubble

So its all the Germans fault for being good at making stuff. The bastards!!!

but if you were a bank, would you give a £200k mortgage to someone on the minimum wage?

I presume that the credit agencies we here a lot about had a hand in signing off the creditability of Greece?

His take home pay is 50% of what it was

or 100% of what it would have been if he had been paying his taxes…

That ever reputable company Goldman Sachs were employed, and paid a lot of money, by the Greek Government to cook the books

Its always the same names cropping up, isn’t it?

…but the point is that Greece weren’t truthful about their economic state and the rest of the euro zone just believeed them or thought ‘it’ll be alright’. If they’d looked into it properly, Greece would never have been in the Euro and the rest of the euro zone wouldn’t be needing to bail them out.

“I presume that the credit agencies we here a lot about had a hand in signing off the creditability of Greece?”

If you look at the amount of foreign credit that flooded in to Greece, compared to their GDP, it doesn’t take a genius to realise that they weren’t ever in a position to pay it back. If we want creditors to make sensible investment decisions, then they must carry the risk.

or 100% of what it would have been if he had been paying his taxes..

Don’t forget the back-handers for ‘helping’ with tax advice – it’s almost mandatory

Most importantly – how much will a bottle of Mythos be in the beach Taverna in a couple of weeks.

Haven’t the Greeks all been retiring when they’re about 40 anyway? That being half the problem. WTF is ‘early’ retirement then? 25?

Hairdressers, waiters and others in arduous and perilous occupations 🙄 get to retire at 50 on 95% of their final salary

The figure of 53 years old as an average retirement age is being bandied about. So much, in fact, that it is being seen as fact. The figure actually originates from a lazy comment on the NY Times website. It was then repeated by Fox News and printed on other publications.

Looking at Eurostat’s data from 2005 the average age of exit from the labour force in Greece (indicated in the graph below as EL for Ellas) was 61.7; higher than Germany, France or Italy and higher than the EU27 average. Since then Greece have had to raise the minimum age of retirement twice under bail-out conditions and so this figure is likely to rise further.

Greeks are lazy. This underlies much of what is said and written about the crisis, the implication presumably being that our lax Mediterranean work-ethic is at the heart of our self-inflicted downfall. And yet, OECD data among its members show that in 2008, Greeks worked on average 2120 hours a year. That is 690 hours more than the average German, 467 more than the average Brit and 356 more than the OECD average. Only Koreans work longer hours.

Democracy vs Mythology: The Battle in Syntagma Square

You can believe the European Commissioner for Economic & Financial Affairs, and the Organisation for Economic Co-operation and Development, or, you can believe Fox News/Rupert Murdoch. The choice is yours.

http://www.eurofound.europa.eu/ewco/studies/tn0702028s/tn0702028s_5.htm

http://stats.oecd.org/Index.aspx?DataSetCode=ANHRS

http://www.thesun.co.uk/sol/homepage/news/election2010/2961190/Cast-vote-wisely-or-we-will-crash-like-Greece.html

“Failing economies like Greece cannot expect to live on EU handouts while they retire at 53 and refuse to pay their taxes.”

I’ve missed you ernie. MUAK.

EURO is … 😈

Nice stats ernie_lynch.

Lets test them:

Greece is going bust.

Stats fail…………..

Ernie returns, full of copy and paste action!

But, as pointed out above, for all his CtrlC + CtrlV, Greece and the Euro are utterly borked.

binners – Member
Interesting article in the financial pages of the Guardian

Alice in Wonderland Economics

Just pointing out what most people knew. The single currency was never going to work. Germany looking to southern Europe for somewhere to invest its enormous trade surplus, fueled a totally unsustainable and unrepayable debt bubble

So its all the Germans fault for being good at making stuff. The bastards!!!

I read that article today and it spelt things out pretty well.

The Euro facilitated a huge wealth transfer from the periphery of Europe to Germany.

They could have carried on with it if they had also generated a bit more domestic demand and bought some goods from other countries to transfer at least some of the money back to the periphery.

I read a statistic the other day that said that Greece has been in default or trying to restructure its debts for over 50% of the last 200 years, so the situation we are in now is not new for them and us. However, the potential repercussions of a disorderly default or much more significant.

Nice stats ernie_lynch.

Lets test them

The statistics which I diligently copy and pasted, and which show that average retirement age in Greece is 61.7 (above EU average), were provided by the European Commissioner for Economic & Financial Affairs, how exactly do you propose to “test them” ?

“Greece is going bust” doesn’t prove this claim to be false. FFS.

Your comment Routeunknown, if you don’t mind me saying, is a typical and tediously gormless, meaningless, and pointless comment, which I have come to expect from those on here who obediently and enthusiastically swallow all the political myths which are drip fed to them.

As I have already mentioned, you are free to choice who you believe. So if you don’t like the European Commissioner for Economic & Financial Affairs figure of 61.7 for the average Greek retirement age, then I would suggest that you go for the 53 in the Sun’s article by Trevor Kavanagh, which I also linked.

Welcome back ernie.

I know far better than to make any comment on your stats <goes off in search of some of his own>

Expensive toy this Euro. No good will come of it, obviously.

Greeks worked on average 2120 hours a year.

Fibbers.

BTW are they all still driving Mercs?

average retirement age in Greece is 61.7

No, they don’t, they show that the average age of exit from the labour force is 61.7

Significantly different, for example, someone might officially retires from their main civil service job, on a full pension, and then works part time after that.

regards hours – hours worked, versus productivity in those hours, is a very different thing too – listed hours would also include all those who are unofficially working two jobs at the same time:

Most civil servants reasoned that with average monthly salaries being no more than €1,000, the cushiness of state posts also allowed them to hold second jobs (policemen working for security firms, tax inspectors working as accountants, department heads running boutiques) which they invariably never declared. Such jobs account for Greece’s huge black economy conservatively estimated at over 30 percent.

Source – The Guardian – http://www.guardian.co.uk/business/2010/may/07/greek-debt-crisis-jobs

The troika have delayed the decision about whether or not to give Greece the next instalment of their loan, see http://www.bbc.co.uk/news/business-15161809

UK, French and German equity indices responding accordingly.

I read last week that the troika officials had been trying to get into various Greek government buildings to check out some figures but they could not get in due to sit-in protests by Greek government workers.

Also, they had ran out of ink to print the tax return forms!

Jesus I read something last night and it really is **** scary. Greece couldn’t simply default. Traders have bought insurance on their debt which means Greece would have to ‘pay down’ massively on the original debt.

In addition ALL our banks have commitments & investment within Europe.

If anyone has last Sundays Times still its on the cover/inside story of the news review.

someone might officially retires from their main civil service job, on a full pension, and then works part time after that.

Exactly – that’s the whole point.

It’s the “exit from the labour force” which counts – not carefully manipulated figures which count those who have chosen early retirement from their professions, but ignore the fact that they often carry on working.

Which is presumably why the European Commissioner for Economic & Financial Affairs has chosen that much more precise method of calculation. And on those figures, the Greeks cease working later in life than the EU average.

on a full pension

The provisions for early retirement from the civil service in Greece does not allow for full pension – I have no idea how many take up the offer of early retirement, but for that reason, I suspect that it isn’t very high.

So the Euro is “borked”. Why then is it significantly stronger against both the pound and dollar than when it was launched? Perhpas because when seen as a whole the eurozone is significantly less indebted than the UK. If Greece is such a problem for the euro then why not California for the dollar? Or NI for the UK for that matter. Debt to GDP including bank bail outs is about the same in Greece and the UK, about 150% of GDP.

Cameron might have distracted some of the contributors to this thread but currrency traders are still focused on the strength of the economies that support each currency. The euro will survive with or without Greece. Which organisation is considering more QE tomorrow? Not the ECB but the BOE.

lovely piece on the beeb this morning, Cameron is to say that everyone needs to sort out their debts, individuals* businesses, banks and governments

*interestingly he only thinks individuals should clear their credit/store cards and makes no mention of the more significant borrowing…

anyway, a long time ago i cleared all my debts and now i want to make sure that i support businesses and banks that are not heavily debt loaded – how can i find out which are the responsible ones and which are the problem areas?

(cant easily change my government)

*interestingly he only thinks individuals should clear their credit/store cards and makes no mention of the more significant borrowing…

Perhaps because it makes sense to reduce exposure to the most expensive sort of credit? Amazing that John Varley at Barclays got criticised a few years ago for saying the same thing ie, dont use Barclaycard as its so expensive. Obvious statement really.

So the Euro is “borked”. Why then is it significantly stronger against both the pound and dollar than when it was launched?

Because its a re-run of economic history. European politicians are too stupid to understand what happened with the collapse of the Gold Standard. They are confused because the rest of the world is actively using currency devaluation to restore competitiveness but the Europeans can’t see that the rules of the game have changed. They are still locked in a zero-currency policy role. Countries like Fr, SP, It, Gre and Ireland are now significantly uncompetitive (against Germany, surprise surprise!!) but cannot do anyting about it. Meanwhile the US, UK, Switzerland, BRIC nations are all actively weakening their currencies in order to stimulate their economies. The same thing happened in the 1930s.

Do not confuse a strong Euro with a good outcome. Sadly for Europe, the ECB has no rules or culture to act like the Fed, BoE, SNB etc to shore up the competitiveness of Europe.

The euro will survive with or without Greece.

Unlikely, watch this space….

Which organisation is considering more QE tomorrow? Not the ECB but the BOE.

As above, the one that understands economics and economic history. Simples!

So the Euro is “borked”. Why then is it significantly stronger against both the pound and dollar than when it was launched

Everyone should want a weak currency

Why then is it significantly stronger against both the pound and dollar than when it was launched

As far as the pound is concerned, the fact that the interest rate is virtually zero makes the currency weak. Plus, as mcboo says, it’s good for our economy.

A weak currency is only good for your economy if you export lots. Running a sizeable trade deficit with a weak currency soon leads to selling the family china. If you like all your national champions falling into foreign hands go on devaluing. QE is effective devaluation.

Take a look at ten-year chart of the Swiss franc against any other currency before you claim they’ve devalued.

Competetive devaluations are a form of protectionism which did nobody any good in the 30s. The gold standard was a major issue at the time as it artificially capped money supply. That limited the size of the economy, worse still withdrawals (in the economic circular flow of income sense) resulted in ever less money in the economy leading to depression.