Why give Greece more cash?

A chance – a massive wage deflation and/or mass unemployment, and an economic catastrophe?????With friends like that who needs enemies.

Greece is an appalling enactments of the perils of a flawed economic model being played out for political ends. It’s grotesque in its awfulness and the major players are all to blame.

Creditors cannot escape the blame here as hard as they continue to try.

“top up bonus” isn’t a pension it’s a bonus, are these the extra 13th and 14th month pensioners get ?

Pensions to GDP 16%. Varoukfakis claims that due to the decline of the economy, well without the 27% decline they’d still be 12% no much higher than other euro countries. All this on top of the fact that much of Greek GDP is / was fake.

Newsnight was very interesting last night comparing wages etc with Portugal and Slovakia. Showing how much the Greek overpay themselves, “a country pretending it’s rich when it isn’t” or something like that was the quote from Evan.

Time to start selling a few assets to pay off some debt?

At the start of the crisis, the Greek government committed itself to bringing in €50bn from the sale of state assets. According to Mr Theocharis, that target was soon reduced to €30bn and then €20bn.
In total, the government has managed to raise about €2-3bn so far.

http://www.bbc.co.uk/news/business-33232074

Whereas we shift pension liabilities off balance sheet and run a Ponzi scheme for most public sector pensions. And we have the cheek to lecture others…..

Simple analogies with household finance don’t have much validity.

Can you inform the British media and voters of this please 😀

…Simple analogies with household finance don’t have much validity.

why’s that then?

Analogy_1: borrowing so much that you’re relying on a pay-rise to cover the payments is risky, especially when you know your plans for growth aren’t viable.

Analogy_2: Lying about your income so you can borrow even more is ****ing stupid.

can someone explain why these comparisons with household finance don’t apply at the national-scale?

(surely what’s happening in Greece shows that they very much do apply?)

I agree with tmh.

@tmh it’s all relative and the Greeks could have made at least a token effort to sort out the tax evasion and the early retirement

@mudshark yes indeed and exactly why the IMF isn’t buying any of the tax raising measures being promised, they want to see spending cuts today not promises of taxes tomorrow.

@awhiles, I think comparisons with personal finances are relevant. It’s folk like Varoufakis who try and obscure financial reality with lots of academic nonsense and grandiose talk of social justice and democracy.

IMO tmh’s comments reflect on the fact that the whole Euro project was a complete nause-up from the beginning and if it wasn’t Greece, this would have happened anyway sooner or later…

It might have worked, it still could. Greek’s should never have been admitted.

Beware of Greeks bearing gifts.

😉

Useful info, mudshark, but about 5 years too late

Mostly so I can get home again. This holiday has felt a little like playing Russian Roulette.

Right, I don’t really understand any of this, but; my folks have rented a villa for a year in Crete. Should I be concerned for them? They say that they are not risking their capital so they’ll be safe from the fallout of any potential outcome to this fiasco. Am I ever going to see them again? Or will they suddenly find themselves living in St Petersburg by the sea, having to apply in triplicate to Putin to get permission to leave? :-/

can someone explain why these comparisons with household finance don’t apply at the national-scale?

because (mostly) you can’t print more money when you feel like it.

The E.U. was always meant to fail – It’s incremental folly – a more palatable step towards Global Governance and the disassembly of sovereignty.. If the Politicians weren’t bought and paid for by anyone other than their electorate – An audit of the central bank’s would ensue and the deficit could be dramatically reduced – But instead we’re on a trajectory that could easily end up with an exponential growth in civil asset forfeiture and a currency reset ..

…..grandiose talk of social justice and democracy.

😆

Could anyone address this please? I’m a little concerned. I quite like my folks…

Right, I don’t really understand any of this, but; my folks have rented a villa for a year in Crete. Should I be concerned for them? They say that they are not risking their capital so they’ll be safe from the fallout of any potential outcome to this fiasco. Am I ever going to see them again? Or will they suddenly find themselves living in St Petersburg by the sea, having to apply in triplicate to Putin to get permission to leave? :-/

Mass deportation of Crete residents to St Petersburg is unlikely. HTH.

Off to Crete on Tuesday;not really expecting it to become a Soviet protectorate in that time. Not expecting to be able to use a card for anything either,but could you imagine living there just now? Poor sods.

nickc – Member
can someone explain why these comparisons with household finance don’t apply at the national-scale?

because (mostly) you can’t print more money when you feel like it.

Almost, but not quite. The essential difference is the ability to print money, correct. But a country cannot simply print money when they feel like it (although some try). If you simply print money, you get inflation which erodes the value of the money, so essentially no point in that.

A government can print money to spend up to the point where government spending plus private sector expenditure reaches the productive capacity of the economy. Beyond that you simply get inflation (at this point economists draw aggregate supply and demand curves and explain their shape).This is actually more important than deficits and surpluses that dominate current headlines, but is notoriously difficult to determine. If you (can be bothered to) read the BOE reports you will see plenty of comment on where they think the UK is in this point of balance.

So the household = government analogies can only go so far, and that is really not that far at all.

Greece to hold referendum on euro bailout deal. The date will be July 5th.

mudshark – Member

Beware of Greeks bearing gifts.

Bit out of date, these days it’s “beware of IMFs bearing loans”.

So they don’t have the money.

Greece has been surviving on the periodical loans to keep its economy afloat.

Now the PM is setting up a referendum to save his ass/sell it to his people that THEY are deciding when the worst thing happens.

Greece cant afford to live without free external money. Harsh but fair comment?

Greece needs to default and leave the Euro.

Take cash with you- card machines etc will stop working

A work colleague has just returned from a holiday on Crete and his straw poll of locals suggested that they want the Drachma back. Possibly because they think they can continue to write their own cheques.

gordimhor – Member
Greece to hold referendum on euro bailout deal. The date will be July 5th.

How much is that going to cost…

So the household = government analogies can only go so far, and that is really not that far at all

There’s also the fact that if you spend more than you bring in as a household and it all falls to pieces, you and your £150,000(?) of debt disappears into the bigger picture of, I don’t know, £1 trillion of local Eurozone economy. Nobody cares.

You spend more than you bring in as a country and it all falls to pieces, you and your £350 billion of debt makes more of an impression on the local £1 trillion economy. People care.

Greece cant afford to live without free external money.

1. It’s not free (although it was mispriced by design)
2. They are not alone. How much do we or others borrow externally?

Harsh but fair comment?

Simply inaccurate, unlike…

Greece needs to default and leave the Euro.

Which has been true for a long time. As is

Take cash with you- card machines etc will stop working

The queues are forming as we speak. Capital controls by Monday?? Meanwhile…

Yanis Varoufakis @yanisvaroufakis
Democracy deserved a boost in euro-related matters. We just delivered it. Let the people decide. (Funny how radical this concept sounds!)

Radical indeed!!!

Greece pushing its game of chicken further, somewhat predictable. If they wanted a referendum they could have had one months ago. By calling it on July 5th they have deliberately picked a date beyond the expiry of the current agreement and the date payments are due to the IMF.

The ECB should suspend aid to Greek banks as Greece is no longer “part of a programme”, Greek banks should shut as they dont have sufficient money to honour withdrawals.

Europe faces more serious issues from terrorism so it’s time to end the distraction that Greece has become and kick them out of the EU, NATO too if they keep copying up with Russia.

Unless the Greeks can find someone to lend them Drachma they will face the (worse) austerity as their budget won’t balance just because the currency changes. It will in fact be much worse as prices of import goods will soar, I doubt Greece is self sufficient in food and it certainly isn’t in oil.

I suspect the referendum is a get out of jail card for Syrizia. They know full well that given the certainty of remaining part of an austerity focused greater whole or going it alone, a frightened people subjected to an overwhelming propaganda assault will vote for the status quo. If by some mischance they didn’t the EU and the domestic government would do what they always do when the natives get a bit bolshie; change a couple of minor points and then resubmit the proposal again until they get an approval, or failing that nobble the votes…

Fair play to the man

Give the people their say then they will be bought in to what ever happens, is this not democracy at work ?

By calling it on July 5th they have deliberately picked a date beyond the expiry of the current agreement and the date payments are due to the IMF.

This!

Perhaps they should have organised a referendum in less than a week Ninfan

I personally would like to see them leave and see if they can make a go of it, because democracy in Europe might improve if Brussels learnt people can say NO.

If they wanted a referendum they could have had one months ago.

Before they knew what the deal was they could have asked people to vote on it ?
The election was a referendum to end austerity he tried the bankers said no. he will let the people decide. The date choice is clever though very unhelpful as it forced the EU/IMF hand before the people have spoken.

Europe faces more serious issues from terrorism so it’s time to end the distraction that Greece has become and kick them out of the EU, NATO too if they keep copying up with Russia.

I do not understand how a Greece outside the EU , out of NATO and now Russias pet toy has helped Europe. Could you explain your thinking here?

So the EZ kiss goodbye to 300 bn and Lagarde presides over the biggest loss in IMF hiistory. Apparently money well spent in pursuit of the neo liberal agenda?

Syriza could have had that same deal and put it to the electorate 4 months ago. They’ve deliberately stalled the process with the intention of forcing the situation to this point. Austerity means balancing the books, the Greeks could have done much more to collect taxes. Their choice.

Greece should never have been bailed out in 2010, the EU gave them a chance in the same way they did Portugal and Ireland for political solidarity reasons.

Default would be €300bn + but the recovery will not be zero. I still believe a deal will be done but not before capital controls (inc banks shut). Eurozone finance ministers have refused Greek request to extend bailout and thus bank funding for another week. The honour of these default records, if that’s what happens, belong with Syriza and the Greek people who elected them and the Greek people who dodge their taxes. This disaster has many fathers.

Russia is an IMF member with 2.5% so the Greeks would default to them too. IMF is a senior creditor and won’t just allow the Greeks to walk away from the debt, neither will the EU. I still say a deal will be done but not before capital controls and more shenanigans

You can’t have a member of the euro, EU and NATO who won’t play by the rules. So as a member they are a drag, a net negative contribution.

The world has more serious issues like IS and the rise of extremism to deal with. The Greeks have been an annoying sideshow, time to prioritise.

Of course another difference from a domestic economy is that if you have trouble with your car loan, it’s not normal for the dealer to go round to speak to your bank manager to remove your overdraft allowance, to screw you up completely even if that means you never can pay for the car.

Still less normal – the dealer invites your neighbour out for a drink and suggests that he moves in with your missus instead of you, in the hope that he will be more accommodating in prioritise car payments over food bills.

I see that Jamba has taken over from jhj as stw’s main supplier of fantasy and conspiracy. Tin foil hats, everyone!!!

I would agree with you but you just cannot argue nor fault a man who calls it 100% correct 100% of the time.