Greece Debt Crisis - Après Oxi

Inquitus · 06-07-2015 03:49PM

Crosswind wrote: »

I am Greek

As a Greek do you really expect the EZ countries to lend more money when over the last 5 years very little if any real change has been effected in Greece?

Labarbapostiza · 06-07-2015 03:52PM

daheff wrote: »

I dont know why the ECB dont just print a couple of hundred billion Eur and turn up in the dead of night and deposit it in the bank account of the Greek Govt??/ Ok...well I do...inflation ,morale hazard,some laws..etc....but it'd be an easier way out for everybody.

Well, the reason is, there is a very serious problem with the mission of the ECB. If you go back to the original formation of the European Union, it's main objective was to avert the kinds of calamities that had led to the rise of antidemocracy and war in Europe.

And now the ECB sees its' mission as protecting the wealthy and making them richer, and making everyone else poorer. And the vast majority of people would not believe that statement, or understand how the system is functioning to make this so. But it is so. The ECB is pumping two trillion Euros of QE into European asset markets. The only beneficiaries are the rich. In the US they pumped five trillion dollars into the "market", it's only effect has been to double the wealth of the richest 1%. How much of this "stimulus" trickled down to the rest of America. Some estimates put it at 3%, but in reality the money is not free, and it will be paid for with decades of lower living standards by the 99%.

Maybe we need another war.

06-07-2015 03:52PM

Quin_Dub wrote: »

My belief is that External devaluation would hurt much more

OK. Why please? Do you have statistics, evidence, economic theory; anything beyond a belief?

All I'm reading are soundbytes.

I have explained why an external devaluation would impose constraints on Syriza, and force them to adapt pro-business policies. Furthermore, Greek exports demonstrate low elasticity, meaning that the tiny manufacturing export industry is, at present, not greatly affected by price movement. This has been corroborated by the very slight improvement in Greek manufacturing exports over the course of its internal devaluation, set against a far better performance by tourism.

Whereas, an external devaluation would be more likely to render more competitive the under-developed Greek agri-food industry (which tends to show greater elasticity), and would continue the upward trend in tourism revenues.

I do not see any sensible basis for your proposition, so there must be some evidence I am missing?

Labarbapostiza wrote: »

There actually has been no negotiation. Troika policy has been a consistent failure on Greece. But the architects are the typical financial services cretins, so what more could you expect.

This is bordering on CT. The most vocal advocates of troika policy that I have seen are internet forum users with ideological axes to grind, and not banks or bankers.

The most sensible criticisms of the troika have come from people within the financial services industry, who by their nature don't get red-faced and morally righteous about debt write-downs and capital investment requirements. I wish I could say the same of the pro-austerity wallahs and the pro-Syriza wallahs who shout loudest on politics cafe.

Crosswind · 06-07-2015 03:53PM

Bob24 wrote: »

1) Salaries and pensions for a starter. And of course the billions of euros savings people have in the banks.

If there were billions in the banks, there wouldn't be a need for the banks to close in the first place, right? Just to mention that three of the four major Greek banks failed the last stress test.
As for salaries and pensions, just to point out that the basic wage is 450 euros more or less with the average pension. You can take them out in a week's time. Inconvenient yes, disastrous no.

2) You said it, by credit card only (while stocks last for imported goods, as retailers can't pay suppliers abroad) and within Greece ... meaning for example that a Greek account holder can't travel to another country if they don't have loads of cash under their mattress.

Most of the Greek companies have off shore accounts, mainly in HSBC, payments are processed just fine.

Crosswind · 06-07-2015 03:56PM

Inquitus wrote: »

As a Greek do you really expect the EZ countries to lend more money when over the last 5 years very little if any real change has been effected in Greece?

No, but i do expect for them to accept their responsibilities for a failed plan they brought to the table. Whatever is owned must be paid, but you can't do that by more austerity.

Bob24 · 06-07-2015 03:57PM

Jonblack wrote: »

Imf should write of their share of loan as they screwed up. Greece gets debt relief, Europe gets repaid. Rest of pigs told no debt relief as your bailouts are o.k

What is due to the IMF is very little compared to European countries and institutions.

KingBrian2 · 06-07-2015 03:59PM

QuinDixie wrote: »

The Greeks will revert to a new currency if they have to.
Greece showed yesterday they are made of stern stuff and if they are booted out they will survive.

where Greece and Ireland differ is that many people in ireland had much to lose if we had pulled a Greece.
I am talking the wealthy minority, all civil servants, all social welfare recipients.
Sure they have taken hits, but nothing serious.

The fact is the vast majority of Greeks have little to lose, so they voted NO.

Very true statement but don't forget their was a hard-core group willing to let that happen here allowing unnecessary suffering, let the banks share price be wiped out. In Greece no doubt they have a larger group of people that are willing to allow their currency to collapse. We are seeing the consequences on are screens and in the papers.

Bob24 · 06-07-2015 04:02PM

Crosswind wrote: »

If there were billions in the banks, there wouldn't be a need for the banks to close in the first place, right? Just to mention that three of the four major Greek banks failed the last stress test.
As for salaries and pensions, just to point out that the basic wage is 450 euros more or less with the average pension. You can take them out in a week's time. Inconvenient yes, disastrous no.

Greek depositors absolutely do have billions on their bank accounts. They can't access them because the banks don't have the money currespondignto these deposits.

Crosswind wrote: »

Most of the Greek companies have off shore accounts, mainly in HSBC, payments are processed just fine.

Howcome they are not able to buy paper to print books and newspapers then?

And how are they sending money to these offshore accounts if their profits are made in Greece? (ie the profits are stuck in Greece)

Crosswind · 06-07-2015 04:03PM

Quin_Dub wrote: »

Krugman , Stiglitz and indeed Yanis himself are theorists - Who've never had to actually try to implement any of their theories...

Their support in the real-world isn't really a measure of "right" to be honest..

And on the other side, you have the implementation of a failed plan (admitted by IMF itself). Are they "more right" than the theorists?

Possibly a factor , but unless they've all left or died since Syriza got elected 6 months ago I can't see how it the main factor given that the General election turn-out was substantially higher.

In the general election the turnout was much higher cause the former government parties were paying for charter flights for their voters.

I'm not following - I've no doubt that there is hyperbole on both sides, but are you saying that everything is actually fine in Greece , everybody is able to buy what they need and go about their daily business??

From what friends/family/former colleagues are telling me, there is no major disruption. Yes, there is the odd small business without offshore accounts, but there are ways around that.

Crosswind · 06-07-2015 04:07PM

Bob24 wrote: »

Greek depositors absolutely do have billions on their bank accounts. They can't access them because the banks don't have the money.

They just can't access cash. They still have their money and they can buy whatever they want within Greece via web banking or cards.

Howcome they are not able to buy paper to print books and newspapers then?

So, a Spiegel's correspondent's word is the absolute truth? This is why i'm talking about FUD.

And how are they sending money to these offshore accounts if their profits are made in Greece? (ie the profits are stuck in Greece)

Scratch that, might be against forum rules

Bob24 · 06-07-2015 04:11PM

Crosswind wrote: »

They just can't access cash. They still have their money.

So if people do have money in the bank then? Bank closures must therefore impact them?

Crosswind wrote: »

So, a Spiegel's correspondent's word is the absolute truth? This is why i'm talking about FUD.

Any specific reason not to believe it? You have a better source?

Crosswind wrote: »

Bulgaria

How are they sending money from Greece to Bulgaria? Capital control rules prevent that.

CatInABox · 06-07-2015 04:11PM

Crosswind wrote: »

And on the other side, you have the implementation of a failed plan (admitted by IMF itself). Are they "more right" than the theorists?

Just wondering if you knew that the IMF report on debt sustainability that you're referencing states that the sustainability of the debt was with-in reason up until the recent elections, and only turned unsustainable after the new government rolled back a lot of the reforms?

I.e. The IMF believe that the plan would have worked if it wasn't for Syriza.

06-07-2015 04:15PM

CatInABox wrote: »

Just wondering if you knew that the IMF report on debt sustainability that you're referencing states that the sustainability of the debt was with-in reason up until the recent elections, and only turned unsustainable after the new government rolled back a lot of the reforms?

I.e. The IMF believe that the plan would have worked if it wasn't for Syriza.

Here's an article from the Economist on just this

KingBrian2 · 06-07-2015 04:15PM

Crosswind wrote: »

From what friends/family/former colleagues are telling me, there is no major disruption. Yes, there is the odd small business without offshore accounts, but there are ways around that.

You may be referring to the informal economy as opposed to the system that is using €'s minted at the ECB and the various central banks that require licensed approval before they can be issued to the general public. Counterfeiting, misappropriating and embezzlement are not activities that should be tolerated.

Crosswind · 06-07-2015 04:18PM

CatInABox wrote: »

Just wondering if you knew that the IMF report on debt sustainability that you're referencing states that the sustainability of the debt was with-in reason up until the recent elections, and only turned unsustainable after the new government rolled back a lot of the reforms?

I.e. The IMF believe that the plan would have worked if it wasn't for Syriza.

I'm talking about 2011-2013, before Syriza era. Which one are you talking about?

BlibBlab · 06-07-2015 04:23PM

Thomas_. wrote: »

The people had their say and voted accordingly as they saw fit. Now, if talks with the EU/IMF failes, Putin might be ready to buy Greece for a cheap price.

I wonder whether the Greeks might be better off in the influence sphere of Putin and being dependent on his Money, or within the EU. I doubt that the Greeks can keep the Euro, not after that vote.

People keep mentioning Russia as if they're an economic juggernaut in the same league as the US or China. They have an economy that is smaller than Italys and is currently shrinking.

K-9 · 06-07-2015 04:26PM

QuinDixie wrote: »

The Greeks will revert to a new currency if they have to.
Greece showed yesterday they are made of stern stuff and if they are booted out they will survive.

where Greece and Ireland differ is that many people in ireland had much to lose if we had pulled a Greece.
I am talking the wealthy minority, all civil servants, all social welfare recipients.
Sure they have taken hits, but nothing serious.

The fact is the vast majority of Greeks have little to lose, so they voted NO.

I can't imagine multinationals and financial services being too happy either as us being in the Euro market is a big draw for them.

As for Greece, the meeting of the finance ministers tomorrow will set the tone. It's all guess work really until then.

Crosswind · 06-07-2015 04:29PM

Bob24 wrote: »

So if people do have money in the bank then? Bank closures must therefore impact them?

Sorry, don't understand what you mean here

Any specific reason not to believe it? You have a better source?

Just myself/family/friends (of both YES and NO sides). Plus the Greek media would have a party if that was true.

How are they sending money from Greece to Bulgaria? Capital control rules prevent that.

Mistake from me on bringing it up in the first place as it's against forum rules.

K-9 · 06-07-2015 04:30PM

Crosswind wrote: »

1) What money?
2) Where do you get your info from? You can buy anything you want via credit/debit cards within Greece. You just can't withdraw cash.

My understanding is many businesses won't take cc transactions as well, they aren't sure they'll be honoured.

CatInABox · 06-07-2015 04:44PM

Crosswind wrote: »

I'm talking about 2011-2013, before Syriza era. Which one are you talking about?

I was talking about the most recent IMF debt report, that came out last week.

Considering that Greece returned to a positive primary surplus in 2014, and returned to the private lending markets, I doubt that the IMF would have considered that time to be a "failure."

Crosswind · 06-07-2015 04:44PM

K-9 wrote: »

My understanding is many businesses won't take cc transactions as well, they aren't sure they'll be honoured.

You're right. There were a few of those businesses in the first few days, but the majority accepts cc transactions now, as it's illegal not to. They give you a good discount though if you pay with cash :P

Crosswind · 06-07-2015 04:49PM

CatInABox wrote: »

I was talking about the most recent IMF debt report, that came out last week.

Considering that Greece returned to a positive primary surplus in 2014, and returned to the private lending markets, I doubt that the IMF would have considered that time to be a "failure."

http://www.imf.org/external/pubs/ft/scr/2013/cr13156.pdf

Cosmo K · 06-07-2015 04:50PM

Crosswind wrote: »

They give you a good discount though if you pay with cash :P

Do they give you a receipt if you pay cash?

K-9 · 06-07-2015 04:54PM

I suppose it could be argued they were showing signs of recovery, as all other Euro countries who got bailed out have done.

Whether it would have been enough, we'll never know.

It seems Greece is on the same path as Puerto Rico atm. Getting yet another write down is hugely important but they're still left the structural problems in the economy.

LuckyLloyd · 06-07-2015 05:17PM

A Tyrant Named Miltiades! wrote: »

OK. Why please? Do you have statistics, evidence, economic theory; anything beyond a belief?

All I'm reading are soundbytes.

I have explained why an external devaluation would impose constraints on Syriza, and force them to adapt pro-business policies. Furthermore, Greek exports demonstrate low elasticity, meaning that the tiny manufacturing export industry is, at present, not greatly affected by price movement. This has been corroborated by the very slight improvement in Greek manufacturing exports over the course of its internal devaluation, set against a far better performance by tourism.

Whereas, an external devaluation would be more likely to render more competitive the under-developed Greek agri-food industry (which tends to show greater elasticity), and would continue the upward trend in tourism revenues.

I do not see any sensible basis for your proposition, so there must be some evidence I am missing?

This is bordering on CT. The most vocal advocates of troika policy that I have seen are internet forum users with ideological axes to grind, and not banks or bankers.

The most sensible criticisms of the troika have come from people within the financial services industry, who by their nature don't get red-faced and morally righteous about debt write-downs and capital investment requirements. I wish I could say the same of the pro-austerity wallahs and the pro-Syriza wallahs who shout loudest on politics cafe.

I'm buying what you're selling I must say. I think your observation about the nature of debate on the other thread is spot on.

1st dalkey dalkey · 06-07-2015 05:39PM

"A democracy is always temporary in nature; it simply cannot exist as a permanent form of government. A democracy will continue to exist up until the time that voters discover that they can vote themselves generous gifts from the public treasury. From that moment on, the majority always votes for the candidates who promise the most benefits from the public treasury, with the result that every democracy will finally collapse due to loose fiscal policy, which is always followed by a dictatorship.

The average age of the world's greatest civilisations from the beginning of history has been about 200 years. During those 200 years, these nations always progressed through the following sequence: From bondage to spiritual faith; From spiritual faith to great courage; From courage to liberty; From liberty to abundance; From abundance to selfishness; From selfishness to complacency; From complacency to apathy; From apathy to dependence; From dependence back into bondage."

It seems that the founders of democracy are at the dependence stage.
Their only choice now seems to be what kind of bondage.

For Reals · 06-07-2015 06:19PM

The broader EU community will want to make the Greeks sweat a while and the likes of Kenny will be delighted as it will show the great unwashed austerity was the sensible route, however I don't believe they will allow the Greeks exit Europe, for two reasons:

1. It would be like someone shouting the Emperor (EU) has no clothes unless Greece sinks beneath the waves shortly thereafter. God forbid they surive and get by.
2. You don't let the saps leave the table of a rigged card game, nor pull out the patsys from the base your pyramid scheme. If Greece goes would others follow, and who'll be squeezed in the name of securing a 'good' credit rating? It's bigger than Greece, it's a message to the working poor everywhere within the EU and everybody is watching.

NorthStars · 06-07-2015 06:26PM

The IMF seem to be prepared to assist Greece.

http://www.irishtimes.com/news/world/europe/greek-crisis-imf-says-it-is-ready-to-lend-to-greece-if-asked-1.2275100

BoJack Horseman · 06-07-2015 06:29PM

NorthStars wrote: »

The IMF seem to be prepared to assist Greece.

http://www.irishtimes.com/news/world/europe/greek-crisis-imf-says-it-is-ready-to-lend-to-greece-if-asked-1.2275100

Note.... Nothing about lending actual money.....
. just "assistance".

Lagarde is looking to us to do the cash

NorthStars · 06-07-2015 06:32PM

BoJack Horseman wrote: »

Note.... Nothing about lending actual money.....
. just "assistance".

Lagarde is looking to us to do the cash

Greece will get their debt writedown.
Kenny will be shown for what he is.
A serf.

Greece Debt Crisis - Après Oxi

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