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Greece and sticking two fingers up at the Euro bank.

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Polarbear
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PostPosted: 08:31 - 26 Jan 2015    Post subject: Greece and sticking two fingers up at the Euro bank. Reply with quote
So, you monetary minded saddos Laughing

What will it mean if Greece defaults on it's debts which looks very likely now?

When Argentina did nothing major happened to her as far as I can see. Do we see a start of countries saying 'fuck it' we aren't paying, do your worst.

Is this the beginning of the end of civilisation as we know it? Mr. Green
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grr666
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PostPosted: 09:16 - 26 Jan 2015    Post subject: Reply with quote
They only really got in that mess because half of the country refuse to pay taxes.
So then, hardly a surprise they've backed out of paying the money back.
They should have been removed from the Euro zone as soon as they
failed to make the grade. Now we are all out of pocket and they will likely head straight
back to the financial state they were in before the bailout.
I can't see them getting any more free lunches from the rest of the Eurozone after this little indignant outburst.
The money they were lent (or is that given now?) could have been put to much better use IMO.
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Copycat73
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PostPosted: 09:46 - 26 Jan 2015    Post subject: Reply with quote
Yes !!! cheap euros holiday money Thumbs Up

and then Germany will see them booted out of the Eurozone.
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Polarbear
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PostPosted: 10:20 - 26 Jan 2015    Post subject: Reply with quote
An interesting take on another forum I go on...





Classic case of turkeys' voting for Xmas.

It will be interesting to see if the Greeks are so joyous when their banks are allowed to collapse, and their country and what social cohesion they think they have goes not long after it.


Who cares about banks? What do they mean and to who? You talk about social cohesion in a country that has 50+% youth unemployment where people are routinely experiencing hunger and an all but total end to social services. For many people there concerns about a banking system are purely abstract, not related to their daily lives in any way. The social cohesion is all but gone and yesterday it took the political centre with it. What happens now in terms of Syriaz forming a government, ending austerity and negotiating with the ECB/Germans are largely irrelevant. Reality is what's happening to a system that is not constrained by reality.

Something that gets lost in all of the this is that nothing that happened in 2008 was caused by reality. The banking crisis that led to the sovereign debt crisis that has seen living standards fall at an unprecedented rate for an unprecedented amount of time wasn't real. There was no famine, no natural disaster, all of the "stuff", the materials, the productive power that was there before the crisis was there after it. What failed were set of abstract ideas that form a social system
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Rogerborg
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PostPosted: 11:28 - 26 Jan 2015    Post subject: Reply with quote
Eh, Jam Today, Pay Never socialism. Some adults will clean up after them, as usual.

I can't see the EU Statists letting them go. The tone seems to be "Nein! Ze cannot withdrawn from ze Euro! Zere is no mechanism!"
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Suntan Sid
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PostPosted: 11:40 - 26 Jan 2015    Post subject: Reply with quote
Follow the money!

Look where the bail out money ends up
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Itchy
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PostPosted: 21:23 - 26 Jan 2015    Post subject: Reply with quote
They are just being rational.

Right now the debt payments are absolutely crippling. So much that most of their output is to pay interest.

If they default on the debt then they get to start again with a cleaner slate.

The new Greek currency will go through the floor and all other currencies will rise relative to it. As a result people will go there to take advantage of it. Like people do now for countries with weak currencies like Thailand. Or Czech republic tourists go there because it is cheap and buys more beers, hookers etc for each £.

This brings in foreign currency and then you get into what is called the economic virtuous circle.

Imagine if you will you pay interest of £50 a day, yet you only make £80 a day. If the interest increases to £60 a day you start cutting back. If it rises to £70 you have to stop eating if you stop eating you can't work so no longer make £80 a day. Therefore the rational choice is a reset.

French/German banks lose out.

Yet some people are saying borrowing more and more until the interest overwhelms your economy is a rational and sensible thing to do?
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Last edited by Itchy on 21:24 - 26 Jan 2015; edited 1 time in total
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yen_powell
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PostPosted: 21:24 - 26 Jan 2015    Post subject: Reply with quote
They're all broke because they are constantly having to buy new china ware. It's totally unsustainable.
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Kickstart
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PostPosted: 21:31 - 26 Jan 2015    Post subject: Reply with quote
Polarbear wrote:
Something that gets lost in all of the this is that nothing that happened in 2008 was caused by reality. The banking crisis that led to the sovereign debt crisis that has seen living standards fall at an unprecedented rate for an unprecedented amount of time wasn't real. There was no famine, no natural disaster, all of the "stuff", the materials, the productive power that was there before the crisis was there after it. What failed were set of abstract ideas that form a social system


The financial problems were there before the crisis. Just that they were being hidden. There wasn't really the money to pay for the standard of living they had before the crisis.

All the best

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Rogerborg
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PostPosted: 22:03 - 26 Jan 2015    Post subject: Reply with quote
Itchy wrote:
If they default on the debt then they get to start again with a cleaner slate.

It's not just defaulting though, which is of course the rational choice for feckless wastrels.

It's that they're promising to go back to living the high life, two yachts for everyone again, funded by... uh...

If they stay in the Eurozone, it'll be with more 'borrowed' money. Would you 'lend' to them?

If they pull out, it'll be with printed money, but that means inflation and devaluation, and they're a net importer.

Once they run out of ouzo, I suspect they might start backing down on the big rhetoric.
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Joncrete Cungle
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PostPosted: 23:08 - 26 Jan 2015    Post subject: Reply with quote
Helvítis fokking fokk, worked for Iceland didn't it?
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Pigeon
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PostPosted: 23:10 - 26 Jan 2015    Post subject: Reply with quote
Greeks have voted to end austerity and renegotiate the terms.
Europe will probably give an inch, but not much more due to knock on effects.

It's then up to Syriza to sell the "win". I'd be surprised if he's genuine and not just been milking public opinion to get him into office.

If the Greeks don't accept the new deal (which is 99% the old deal), then it could get ugly. How can Greece leave the Euro scot free without Portugal following quickly after, possibly Ireland and Spain crying for better terms too.

The amount of QE the ECB is printing should well cover Greek defaults in value terms and maybe that is part of the plan.
A sunk Euro and Germany gets the benefit of more competitive exports and it's not left dancing in a chairless room when the music stops.
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mentalboy
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PostPosted: 23:19 - 26 Jan 2015    Post subject: Reply with quote
Joncrete Cungle wrote:
Helvítis fokking fokk, worked for Iceland didn't it?


...and maybe you'll recall the amount of monies our local councils lost whilst trying to cash in on high rates offered by Icelandic banks. YOUR monies which were meant to be there for YOUR services.
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Joncrete Cungle
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PostPosted: 23:24 - 26 Jan 2015    Post subject: Reply with quote
mentalboy wrote:
Joncrete Cungle wrote:
Helvítis fokking fokk, worked for Iceland didn't it?


...and maybe you'll recall the amount of monies our local councils lost whilst trying to cash in on high rates offered by Icelandic banks. YOUR monies which were meant to be there for YOUR services.

If a deal looks to good to be true, it probably is. One wonders if any of the wastrels responsible got the boot from their cozy council cabal?
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smegballs
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PostPosted: 00:05 - 27 Jan 2015    Post subject: Reply with quote
Pigeon wrote:

A sunk Euro and Germany gets the benefit of more competitive exports and it's not left dancing in a chairless room when the music stops.


Just making sure I'm on the same page....

Germany wants a weaker euro to make it's stuff more affordable so more people can buy their exports, ja?

Strong euro = expensive goods = less sales
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Itchy
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PostPosted: 00:31 - 27 Jan 2015    Post subject: Reply with quote
Rogerborg wrote:
If they pull out, it'll be with printed money, but that means inflation and devaluation, and they're a net importer.


As above during the 90s Greece did ok. Imports go down, tourism goes up, you get a short sharp shock and can start rebuilding again.

Or you could do what the UK did and is doing and extend the downturn well since 1989 (the last blip of real growth which wasn't funded by debt or credit expansion).

mpd72 wrote:


It's not like their money originates from ordinary working class folks, in the form of pensions and savings is it?.


You're about 100 years out of date on that. See funding for lending free government money to loan out.


mpd72 wrote:

They have been living a left wing Eutopia with regards to their unaffordable social state. They've been spunking cash up the wall, ran silly debts up and now want to write them off so they can return to the magically funded social state,


You could use that to describe ANY European country. The UK overspends by 100bn a year down from 160bn a year. Oil isn't going to last forever either.

-7.2% current account deficit too. While we can point and say ha ha the UK is not exactly in a much better position.

We have some civil servants on here who can't define they jobs but get paid £70K+ you somehow think we're in a better position?
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stinkwheel
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PostPosted: 01:07 - 27 Jan 2015    Post subject: Reply with quote
mentalboy wrote:
Joncrete Cungle wrote:
Helvítis fokking fokk, worked for Iceland didn't it?


...and maybe you'll recall the amount of monies our local councils lost whilst trying to cash in on high rates offered by Icelandic banks. YOUR monies which were meant to be there for YOUR services.


The Icelandics don't give a fuck. Nor should they given they pay fuck-all for power and heating.

In fact, they think it's funny. "We had a vote and decided to pay none of it back. That's ok though. It's democratic. If you diagree you're a nazi." Some Icelandic bloke down the pub in Rejkavik. Last summer
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Itchy
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PostPosted: 11:50 - 27 Jan 2015    Post subject: Reply with quote
mpd72 wrote:
Whoah there tiger, you said "French/German banks lose out". I'll ask again.... where do you think banks get the majority of their money from? Who's money is it again?.



Two sources:

By creation of credit and leveraging it. Credit != money. But it is often treated as the same thing.

Also if you unwind money all the way back to origins of tokens then banks get their money from themselves. It is extremely obvious when you consider other tokens used as money.

Tally sticks for instance.

The state demands tribute in tally sticks. Or leg breaky breaky.

A second party (which just so happens to be the state) offers to sell you these tally sticks, note SELL not give. You sell your labour/goods to this individual you get the tally stick and give it to the state.

The separation of identity makes this more acceptable to the human psyche. It is much more effective than a bloke standing over us with a bull whip. As individuals can demand tally sticks from each other and build surpluses and move up the food chain and have a piece of it. A lot of people think they're doing us a favour because of this arrangement.

Remnants exist with tax DEMANDS. Oh and the fact we pay them because of leg breaky breaky rather than anything else.

Quote:


No you can't compare Greece to ANY European country. There is a huge difference between a country who can service their debts and one who defaults on them. Even more so when this country has a ridiculously unaffordable social system and is woeful at getting it's citizens to pay tax. This was the country where you could retire at 57 on a full state pension up until 2010. I wonder if they still leave the iron rods poking out the roof of the house, so they don't have to pay tax on it, due to it "not being finished yet"? Now, the new leader appears to be shifting away from austerity again by promising to raise pensions, wages and re-employing 4M people back into the already crippling public sector.

I'll be amazed if this doesn't end in tears for the Greek.


Again how does this differ from the UK? The UK had a failed bond auction in 2009. Which resulted in money printing (soft default). You think that tax avoidance and evasion doesn't happen in the UK? In the UK we can't even get corporations to pay their taxes. For years we even allowed sole traders to act as ltd companies and pay no income tax until the non corporate dividends were implemented.

Glass houses much?
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Itchy
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PostPosted: 17:05 - 27 Jan 2015    Post subject: Reply with quote
mpd72 wrote:
So, cutting all the crap, you're trying to say that banks don't make money out of other, every day people's money? Ah OK...So the FSCS Deposit guarantee isn't needed then?.


Banks already make money out of other peoples' money via renting it to them.

It is more profitable however to create credit and use that as a money substitute to make money instead.


Quote:
It differs greatly because, the UK hasn't asked for a bail out from the EU and isn't threatening to default on it, our economy is growing and our deficit is coming down. Seriously, if you really think the situation in the UK is anywhere near the level of the problem in Greece, I think you're in a minority.


The UK defaulted in 2009 when there was a failed gilt auction. Printing money is a form of default.

There are some very ugly things building up with the boomers retiring in the very near term.
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Pigeon
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PostPosted: 19:18 - 27 Jan 2015    Post subject: Reply with quote
mpd72 wrote:

So, cutting all the crap, you're trying to say that banks don't make money out of other, every day people's money? Ah OK...So the FSCS Deposit guarantee isn't needed then?


Just to add my 2p to this. Banks use leverage and hypothecation (promising theoretical collateral in return for a loan with in some cases no limit on the number of times the collateral can be pledged) to create money/debt on a vastly larger scale compared to cash deposits.

Tier 1 ratio in UK banks is something around 3-6%. The banks only need to have 3% cash on deposit compared to the rest of their loans.
Fractional Reserve banking allows them to legally create debt out of pretty much thin air.

You don't have to look to far to see that this system is purely used to control the masses. Gross World Product is around 75,600 billion dollars. The M2 or M3 money supply (measurements of money based on various criteria) puts global cash at around 60-75,000 billion dollars.
Yet the total value of derivatives is estimated at 1,200,000 billion dollars.

Roughly speaking there are financial "assets" with a "value" of 20x all the cash in world.
If ever you wanted an example of how fucked up the system is, it's right there Smile
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