A "No" vote is an endorsement of the left-wing Syriza government's view that the austerity package attached to Greece's bail-out deal is too harsh. Leftist opponents of “austerity economics” across Europe and beyond are rejoicing, as are critics of the EU’s bureaucracy, at its having received a bloody nose.... Greece will leave the eurozone. That is what the EU says, and is likely to happen.... Greece will run out of cash. All eyes will turn to the ECB, which on Monday will have to decide whether to continue to extend its emergency financial lifeline to the Greek banks.... Greece will have to find a factory to print drachmas.... Greece’s economy will (still) be in ruins....
July 5, 2015
"What happens next after the 'No’ vote in the Greece referendum/Will the eurozone collapse?"
Asks the UK Telegraph:
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Everyone is watching the soccer game. Japan is playing the role of the Greece economy.
Instapundit says it's basically Hilary Clinton vs Bernie Sanders over there.
Don't discount Greek ruins though.
What happens next? Things are going to get interesting. The debt is unpayable, everybody knows that.
Young people voted οχι! overwhelmingly. They've got nothing to lose. They have no jobs and they're the ones who'll be left holding the bag from the huge debt circus that is Greece, Europe, and us, too. The middle-aged vote - more equivocal. The older people voted to eat the young - the want to keep the circus going a few more years, devil take the hindmost.
Whatever happens, we can be pretty sure that the debt holders are going to figure out some way to transfer their losses to somebody else.
If Greece gets kicked out of the Euro, look for Greece say, "that breaks the deal, we do't owe you any money."
If I were a business that trades with Greece, I would halt all shipments to Greece, not sell them a thing unless paid in hard currency. Russia and China might step in and sell Greeks anything they want, and on credit, not really caring if they are paid back or not. Make Greece dependent on them. Realpoltics.
Whatever happens, we can be pretty sure that the debt holders are going to figure out some way to transfer their losses to somebody else.
The Greek government is already talking about stealing half the money people have in the bank. (A Democratic wet dream!)
No, Greece won't collapse, and the Euro project won't either. Greece may well leave the Eurozone, however. I've been blogging this like a storm: 'Greece Considers Nuclear Options!'
I think the Greeks are better off out of the Euro. They need to recognize that they are a poor country and their economy will be tourism and olive oil for a while. The Drachma will not be worth much but tourists like me will come and spend some money. I have tickets to go there in September but, of the anarchists tear the place up, they will destroy tourism like Egypt and Tunisia have done.
"stealing half the money people have in the bank. (A Democratic wet dream!)"
The Obama people have already talked about 401ks being raided.
If a collapse happens, "austerity" or "the rich" will continue to be blamed; sounds familiar...
"If Greece gets kicked out of the Euro, look for Greece say, "that breaks the deal, we do't owe you any money."
That would be clarifying. They were never going to pay it back anyway. Better that the break is clean.
It's pretty simple - Greece is screwed regardless of whether it exits the Eurozone and returns to the Drachma, or if some sort of last minute deal is cobbled together so that it can stay in the Eurozone.
The debt owed the IMF, ECB and other creditors is so far beyond the ability of the country to pay that the only rational answer is to repudiate the debt. This probably works best after exiting the Eurozone, but it might be possible whilst keeping the Euro, although I suspect a debt repudiation would be coupled with Greece being expelled from the Eurozone.
Greece has a long history of running up government debt to unmanageable levels, followed by a repudiation, so it wouldn't be the first time.
The portion of the Greek government debt held by the ECB far exceeds the ECB's capital, so some form of capital call of the EU governments would be necessary following default. This will require countries that are not too prosperous, such as Portugal, Spain and Italy to kick in significant (as measured by these countries budgets) money to recapitalize the ECB. And, some of the Greek debt is owned by various private banks that will also have capital impairments, some of which may be serious enough for them to ask for government handouts.
Even with a return to the Drachma, the Greeks have to learn that "living off the kindness of strangers" is no way to run a country. Cleaning up government corruption, fixing rampant tax evasion (not unrelated to government corruption), reduction of public sector employment, etc. are all necessary steps. But, it takes a long time to change a country's culture.
Greece unemployment rate was 25.6% in March. We are talking major basket case here.
Socialism fails again.
A "No" vote is an endorsement... Yes. The question is if Greece will restructure, or will they continue to live with a misalignment between production and consumption, or perhaps between taxation and spending. Europeans created a virtual economy through financing. Greeks created a false utopia with beliefs of immediate gratification.
That said, despite the obvious [temporary] leverage enjoyed by America, will we address the same problems in our left-wing political, economic, and social policies; or will the same misaligned promises, shifted production, and imported labor/bodies compensate for our beliefs?
As Margaret Thatcher once said "Eventually one runs out of other people's money"
"Socialism fails again."
That's what happens when it's "everybody's money". (Robert?)
French president Hollande has assured the world that the Germans will pay whatever it takes to keep the Greeks in the union.
The debacle has "Mr. Chairman, we do not have a crisis at Freddie Mac, and in particular at Fannie Mae" written all over it. Then with progressive debt, increased taxes, and aborted babies, "affordable health care". The foreign-held debt in particular has increased to one third of our GDP. I wonder what collateral, privileges, and amnesty they are offering to secure their positions.
MichaelK wrote:
"The Obama people have already talked about 401ks being raided."
Don't worry, Michael! Only the 401k's of the rich will raided -- those people with 401k's worth over $5,000. Even these rich will be compensated, dollar for dollar, with Obama bonds that mature in 100 years and pay an annualized rate of -1.0%.
I'd sell those short, if I were you.
Here's yur Greek 10 year bond price to eyeball tomorrow:
http://www.bloomberg.com/quote/GGGB10YR:IND
Meanwhile, in China . . . . . . .
JackOFVA wrote-- But, it takes a long time to change a country's culture.
I don't know. look what The HNIC has accomplished in 7 years. Just think what he can do in his final 1. Breathtaking is one word I would use to describe it. Others would be unconstitutional(no matter what the fucking SCOTUS sez), and traitorous. But I'm a racis'...what could I know?
And no. Greece will not be kicked out of the EU. A plutocrat will kill his family first, before giving up one jot of political power. Greece would be lucky to be shed of the dead weight in Brussels. Then they have to shed the dead weight of their own socialist too. I can see Sparta rising up from the ashes!!
The Greeks have no choice but to repudiate the debt or at least most of it. They can keep the euro as a currency if they wish just as Panama uses the US Dollar. However they can't print any euros and they sure won't be able to borrow for a while so they will have to live within the their means and export as much as they can and try to get as much tourism as they can. As for expelling Greece out of EU that is something altogether different. Bringing Russians, Chinese and others into Greece is not a wise move. In my opinion the EU will take the financial haircut, cut Greece some slack in regulations to help stimulate the Greek economy and let them grow their way out of this mess but the EU will not be lending any money any time soon. Whether or not the Greeks are wise enough to realize just how bad a mess they created for themselves and act accordingly by seriously reforming the country remains to be seen.
Somewhere the ghost of King Priam is cackling madly.
Left Bank of the Charles said...
If Greece gets kicked out of the Euro, look for Greece say, "that breaks the deal, we do't owe you any money."
Right now that looks like the best deal for everybody.
Greek socialism has failed due to the long history of western colonial oppression and select north american republican and conservative leaders failed policies and criminal acts -- signed: every lefty
Let Disney buy Greece at pennies on the Euro and have them turn it into a giant historical theme park.
All the rollercoasters need not be economic.
I am Laslo.
An anecdote to illustrate how Greece got into this mess.
One of the managers at the pizzeria I eat lunch at was an older Greek guy. He would often sit and talk with me at lunch (he had a burning hatred of GWB & that made for some interesting conversations).
One day, he told me about how he had bought a house in the village that his family came from in Greece & he would go back for periodic visits.
Well, the villagers all loved their "rich" American cousin, and they said to him "Nick, come live with us all the time. We'll elect you mayor!"
He then said to them: "Do you know what would be the first thing I'd do? I'd put half of you in jail! You're crooks! All of you are goddamn crooks!"
Well, that cured the "Elect Nick for Mayor" ardor, let me tell you.
From what I've read, the corruption in Greece cut across all class lines and ideologies. At the end of the day, Greece is a Balkan country. How long does it take to recover from Ottoman rule? And they want to restore the Caliphate. There must be some way of pinning this on the Germans.
"Greek socialism has failed due to the long history of western colonial oppression and select north american republican and conservative leaders failed policies and criminal acts -- signed: every lefty"
That and the fact the minimum wage wasn't raised to $55 Euros/hour and the work week wasn't shortened to 25 hours/wk.
Fortunately for the Greeks (cough), a full blooded socialist has recently assumed command. We have a ring side seat.
I don't really give a flying f*ck what happens to Greece. I can't think of anything that Greece has contributed to the world in the last 2,000 years (1,000 if you count the Orthodox Church). What matters is what the rest of the world -- including but not limited to the EU -- learns from the Greek experience. If the world learns that when you run out of other people's money it's a disaster, there may be changes of policy in constructive directions in the proto-Greeces. And the lenders in the solvent countries may sharpen their pencils and their lending standards. If the world says, What's Greece to me? then the world will continue down a dangerous path, to the next disaster -- which will necessarily be worse.
The Common Market was a good idea. The EU and the Euro seemed like the next logical steps. The more countries in the system the better seemed to make sense. We should by now be able to see that these were mistakes. My sense is that too many powerful interests are tied into this system to reform it until and unless there's an absolute disaster. I hope I'm wrong, but I don't think that Greece will be the end of the process.
And the US will learn NOTHING from this.
learns from the Greek experience
Every generation is convinced that there is a government sponsored utopia just around the corner!!
Worry about the Chinese market collapse.
"countries that are not too prosperous, such as Portugal, Spain and Italy"
Kind of an understatement..
I hope they don't have to raise their retirement age..that would be just awful.
But mostly I'm concerned about an interruption of the imports that I need..like their terrific salad.
It must be Bush's fault. It can't be President Obama's or Ms. Rodham-Clinton's. Greece was already too far gone when they took over.
The Greeks have always been good negotiators. I would not bet against them now.
If the Greeks are smart, they will make the country peaceful and cater to tourists. They may not be smart. The Greek Islands should be a bargain next year. The mainland, maybe not.
They'll have to compete against Cuba now.
Professor's Althouse had a post yesterday about a Greek monastery on Mount Sinai. These monks insist that a bush, at least a thousand years old, is the actual burning bush from the Old Testament. So even if we are delusional, we've been around a long time and have survived much worse. In any event, the answer: ROBUST growth after six months.
Greece has the power to threaten Europe. They can announce, unless given 6 Trillion dollars, that they will flood Europe with African migrants. Ending their interdiction programs.
Germany and France would have cargo airplanes coming in with Gold, Silver, and US $100 bills.
War is what happens next.
Countries and people don't blame themselves for their own problems. They blame everyone else.
If someone is starving every day of their life and they go from eating almost nothing to eating nothing, they don't throw a huge fit. They say, life has always sucked, this is no different.
But when you're eating steak one night and dirt the next, you want to lash out. You want to destroy the person who has destroyed you. And since it's never your fault, find a scapegoat and go to war.
War is next.
Blogger Diogenes of Sinope said...
Worry about the Chinese market collapse.
There is no chinese market collapse.
When a market runs up almost 150% in 12 months and then goes down 40% in three weeks, that's called profit taking. Not a collapse.
If it goes down more than it's gone up? That's a collapse.
Cubanbob,
I've read hundreds of comments about this today and yours is the most plausible.
Yes, it has been a slow, unproductive day.
Almost Greek-like....
Blogger cubanbob said...
Whether or not the Greeks are wise enough to realize just how bad a mess they created for themselves and act accordingly by seriously reforming the country remains to be seen.
Let history be your guide.
Every week I don't win the lottery, again.
Every day, the sun comes up in the East and sets in the West.
And human nature remains human nature.
Common sense tells you that it can't go on. And it won't.
Although almost 5 years old, Michael Lewis' stuff is worth reading (his chapter in Boomerang on Greece or this similar piece in Vanity Fair -- http://www.vanityfair.com/news/2010/10/greeks-bearing-bonds-201010). Greece has a culture where everyone (yes, everyone, including pretty much everyone in government) routinely lies and commits tax fraud. No one pays the real taxes owed by them and no one is punished for tax evasion. How do you fix a country's financial system where the problem lies root and branch in a broken and corrupt culture with no concept of civic virtue: "It behaves as a collection of atomized particles, each of which has grown accustomed to pursuing its own interest at the expense of the common good. There’s no question that the government is resolved to at least try to re-create Greek civic life. The only question is: Can such a thing, once lost, ever be re-created?"
More recent Michael Lewis piece on Greece -- http://www.bloombergview.com/articles/2015-05-07/greece-saunters-across-the-autobahn.
What will happen?
The banks will not open; people will begin to starve. Obama will declare the situation in Greece to be a humanitarian crisis and open the door to refugees. Any Greek will be permitted to come to the U.S. as long as they appear inclined to vote Democrat.
We took the Somalis here in Minneapolis so it is some other city's turn. Perhaps Madison?
In am era when words mean nothing and the law is the whim of greedy, selfish, evil men (and women) there will be no "default", even if that is what has occurred, because a Greek "default" means Credit Default Swaps get triggered and banks the world over become insolvent. Criminal bankers will never let that happen, so it will be that the Greeks "decided not to pay" and stay in the Union.
In addition to the markets declining rather sharply, oil and gold are following suit. One must presume it's because of the perceived strength of the dollar. You know, the dollar held up by the treasury department's printing press operating at warp speed..
. As for expelling Greece out of EU that is something altogether different. Bringing Russians, Chinese and others into Greece is not a wise move.
I'm not seeing why it's not a wise move. Let them blow billions keeping them afloat (Russia certainly lacks the money to actually do it and China has some serious cracks in their economic walls). Make Greece THEIR issue. Russia and China are less likely to be as accomodating as the EU was.
I wonder how the Greek socialists expect this to work itself out--if no one bails them out, and they try inflating their way out of this mess, why would anyone imagine this will not end Argentina-style?
I imagine they're hoping for a better deal, and that the creditors would rather take a haircut than to have the Greeks completely default and leave the Eurozone (along with maybe another few similarly situated countries soon after).
Blogger Brando said...
I wonder how the Greek socialists expect this to work itself out--if no one bails them out, and they try inflating their way out of this mess, why would anyone imagine this will not end Argentina-style?
I imagine they're hoping for a better deal, and that the creditors would rather take a haircut than to have the Greeks completely default and leave the Eurozone (along with maybe another few similarly situated countries soon after).
They are going to have to deal with the nation sized version of loan sharks. Everybody and their euro brother are going to want a piece of anything Greece imports or exports. Not to mention raiding savings accounts.
Greece is a remarkably interesting and beautiful country. A wonderful place to visit. We were just tourists, but had the advantage of (1) a very loose tour with a tour guide who was open to answering questions and (2) meeting up in Athens with a friend/client who was born in Greece and lives there part of the year. It was obvious then (about five or six years ago) that the country was thoroughly corrupt, virtually everyone is cheating in some way, it's impossible to "do business" in any normal sense of the words and it's basically a basket case there. In addition, they seem to expect to work for 25 or 30 years and then retire. But there's plenty of blame to go around in lots of directions. Just like there will be here in the US soon enough. We're a dead country walking, worse than we were a few years ago as a result of eight years of Zero. For some reason, no one is talking about it. Instead, we're talking about "black bodies" and flags.
We Are All Greeks Now:
http://dailycaller.com/2015/07/02/we-are-all-greeks-now-does-totalitarianism-lie-ahead/
Very good article.
"Hello, I must be going.
I cannot stay,
I came to say
I must be going.
I'm glad I came
but just the same
I must be going."
The Russians and the Chinese will put chump change into Greece and then establish a naval base and airfields. At least that is he fear. But Russia is hampered by its own economy and any Russian or Chinese military assets in Greece would be cut off and destroyed immediately in the event of a real conflict. To me the real worry is that a Greek military alliance could spread to Italy, once Italy's weakened economy implodes.
In any event all of this is a sideshow. The Chinese financial system--black hole that it is--is the main game. Greece is important in itself but most important because it is diverting attention and resources from the problems in China, the extent of which are unknowable right now.
Harry Truman got the Russians out of Greece in the 1940's. Harry, they may be coming back.
Germany holds the largest chunk of Greek debt, followed by France and Italy; the three together hold more than half. If Greece repudiates its debt, it will be a body blow to the Euro, as well as to the political fortunes of Merkel and Hollande.
Michael K said...
"stealing half the money people have in the bank. (A Democratic wet dream!)"
The Obama people have already talked about 401ks being raided.
Should this happen, I sincerely hope to see politicians hanging from lamp posts. No, I am not kidding.
As for Greece, they really have not done much more than what America has done. They're just a few years ahead of us. We still have the advantage of being able to magically make money out of nothing. Still, something that can't go on forever will eventually end.
" If Greece repudiates its debt, it will be a body blow to the Euro, as well as to the political fortunes of Merkel and Hollande."
Really? You think the German and French voters want their tax dollars used to prop up Greece?
And if the Euro goes the way of the dinosaur, it won't be as a result of Greece leaving. Rescuing Greece could kill the Euro, but letting Greece leave probably won't. That's a job for Spain, Italy and Portugal.
The Greeks voted against letting externally imposed austerity measures impoverish them. But by rejecting that, whether or not they understood it, they voted to let market forces impoverish them. They are in such a deep hole that impoverishment is a given. I doubt Greek voters as a whole understood that, but my guess is that their truculencelec them to pick the best impoverishment mechanism. The market will impose no more nor no less impoverishment than necessary. Who knows how far the externally imposed austerity measures would have taken them?
Before everyone goes wacky...get at sense of proportion.
After almost 30 years of war, Iraq has a greater GDP than Greece.
The Greeks voted against letting externally imposed austerity measures impoverish them. But by rejecting that, whether or not they understood it, they voted to let market forces impoverish them.
Ironically, they never experienced "austerity" (you don't spend far more than you take in during "austerity")
NOW, they may have to face REAL austerity.
I don't see how the ECB can legally provide funds (emergency or otherwise) to Greece, as the only way they could do so would be by pretending they expect repayment, which isn't going to happen.
The ECB is there to provide liquidity, but the problem of Greek banks isn't liquidity, it's insolvency. That's not a problem the ECB (or any central bank) can solve.
Never trust a Greek. They see you as prey.
Via Instapundit
Spiros said:
"In any event, the answer: ROBUST growth after six months."
How do you see Greece getting from here to there?
Welcome to the Parthenon, brought to you by Audi.
"Never trust a Greek."
Unless it's just food.
This is a repeat of our mortgage mess. The German bankers booked bonuses on loans they should have known couldn't and wouldn't be repaid. The Greeks done wrong but so did any bankers who spent their bonuses. A bailout would be not just for the Greeks but for Europe's financial elite.
David: Really? You think the German and French voters want their tax dollars used to prop up Greece?
French and German taxpayers are already on the hook for the previous failed attempts to prop up Greece.
Tsipras has painted himself into a corner with the referendum, whose meaning was apparently misrepresented before the vote and is now the subject of desperate exegeses. He has nowhere to go. Neither do his countrymen. Either they accept whatever terms the ECB will dictate, and the can gets kicked down the road another year; or they print themselves all the drachmas they want, which have an exchange rate of a trillion to one.
Just like there will be here in the US soon enough. We're a dead country walking, worse than we were a few years ago as a result of eight years of Zero. For some reason, no one is talking about it. Instead, we're talking about "black bodies" and flags.
The left has a plan.
Tax the rich!
Which is an adorable plan if it were thought up by a four year old.
But it's andea promulgated by grown ups.
Which makes it worrisome.
That frown ups could be that stupid.
grown ups
Frown ups works.
2000 - U.S. Debt $4T
2008 - U.S. Debt $8-10T - Depends on who's counting!
2015 - U.S. Debt $18T - And apparently not counting!
Two unsustainable, untouchable, Sacred Cow entitlements!
Another unsustainable, untouchable Sacred Cow entitlement just added!
2024 - U.S. Debt $36T ??????
2032 - U.S. Debt $72T ??????
Oh, nevermind, #LoveWins! Keep the presses rolling!
Pay your fair share..not your fare share! (I know..somehow that's "raaacist")
Really? You think the German and French voters want their tax dollars used to prop up Greece?
It's governments. What voters want doesn't mean a damned thing.
And as was pointed out by somebody, I think, on YouTube --- basing your debt on percentage of GDP is pointless since nobody has access to 100% of GDP. You need to look at debt as a percentage of GDP available via taxation.
And with that --- we're REALLY fucked.
damikesc said...
The Greeks voted against letting externally imposed austerity measures impoverish them. But by rejecting that, whether or not they understood it, they voted to let market forces impoverish them.
Ironically, they never experienced "austerity" (you don't spend far more than you take in during "austerity")
NOW, they may have to face REAL austerity.
Now, they may have to face economic reality. Runaway spending and borrowing to cover the shortfalls are seldom paths to prosperity. Imagine that. As Lady Thatcher noted, the Greeks have run out of other peoples' money. They can no longer borrow money to pay for their bloated government payrolls with early, generous retirements. They can no longer afford their massive corruption and tax evasion. It does sound somewhat familiar, doesn't it?
I think the answer is more Green Energy. Solar panels on the Parthenon = huge profit from selling electricity to Germany! Modest upfront investment may be required. Call 1-800-EURSCAM, operators are standing by.
I was in Europe after the Wall fell but before Poland joined. You zipped about the highways, France to Belgium to Germany. Then you hit the Polish border. Trucks were lined up for miles waiting to clear customs. So the "Common Market" concept was a good idea; it improved economies. But then the "Olympians", administrators with ideas got in on the Market and tried to form it into a "Centralized Scientific State" devoid of differences aka inequality where all sections had the same amount of roads, trains etc per mile and the same financial system with the same rules for all the administrators and the same set of administrative regulations (which it cost money to implement)and the same green administrative policies (which it cost money to implement) and loans to carry it all out and the same immigration administration policies leading to many illegal immigrants in Greece (and loans to pay for that) - and regulations on how to pay back the loans. It didn't work because there was no give in the system. Now the legislators in Greece have claimed they can make the rules in the case of paying back the loans.
Probably they understand that that they can't stay in the system without following the same administrative rules - there are thousands - and they can't follow the rules - it costs thousands - and so EU-administrators what'cha gonna do?
I could easily be wrong about this but I just think that Greece is being so boneheaded because it is pointing to a different problem than the one being discussed. It isn't the paying back the loans; it's the rules that required the loans - and the rule by administrators - and the non-involvement of the legislature until now. And that's a widespread problem. Hence the Greek problem must be solved; hence the conviction that the EU must and will negotiate with the Greek legislature. Hopefully the EU will not think letting a crash occur is a good way to stop other states from telling the Brussels-Admin to shove it; this would only happen in a sci-fi story.
What hopefully happens is the country gets the economy it deserves. Maybe what then happens is they don't like said economy and stop acting like socialists and instead try to apply common sense.
My guess though is they will stay mired in their current predicament. They are going to go down with this sinking ship no matter what.
They better hope there is big uptick in desire for olive oil and zorba the greek, or bouzouki music. Otherwise, they are in big trouble.
I went to Greece as a teen and we went to a book store that had nothing but English books. When talking to the greek guy behind the counter, he regaled us with how Greece was being exploited by the US, and they are not capitialists like the evil US is (he didn't use the word evil, but it was quite clear his country knew better).
That was a long time ago. My guess, if he still had hs bookstore he'd be saying the exact same thing. Its not socialism to blame but capitalism. You can't teach stupid people new things. And socialists are particularly mired in their ideology. The last thing they would ever do is test the results, by, I don't know, looking around the landscape and seeing how their economy is in the toilet, and come to the conclusion that maybe socialism has something to do with it.
Like the people in Detroit are always the last to know why Detroit failed. IT's easy. Because its run like a blue state. by socialists, or wanna-be socialists. Who don't have a concept of budgets and only having a govt that you can afford and not one you need to borrow from foreign countries to maintain.
nn 7:42. I'm betting "no" and "no."
It is sure tiresome reading Big Press going on about a bailout for "Greece." A bailout will be for the bondholders of the Greek Government (which is not "Greece"). It is for German banks and French banks, which firms will take the money however gotten by the Greek Government without apparent embarrassment, and may be ruined if money does not come (all sovereign debt is counted as good tier 1 capital under the rules made by the sovereigns, though different sovereign debt carries different yields due to differences in risk, so a sovereign default affects more than just the asset side of the balance sheet of the bondholder bank; smart, eh?). The bondholders foolishly lent money to the Greek Government, even after it was evident that the Greek Government was insolvent (this is known as throwing good money after bad.) The Greek Government will steal from those that managed to save and -- perhaps foolishly -- kept their money in Greek banks, in order to try to get more debt to service the existing debt and pay the "pensioners" (there's a wonderful term). If the savers lose only half their savings, that will be a miracle.
James B.BKK: It is sure tiresome reading Big Press going on about a bailout for "Greece." A bailout will be for the bondholders of the Greek Government (which is not "Greece").
Exactly. Nobody gives a crap about Greece but the Greeks. Bailouts are bailouts for the bondholders, period. For some reason, a lot of people seem to think that "market discipline" is only sauce for one side of the trade. As if the bondholders didn't know that Greece was full of Greeks. Ha.
@Virgil Hilts 11:52: There would be nothing wrong with all the things you described if others were not so foolish as to lend money to a government of such people. Bond vigilantes? Not hardly.
@Mick 3:23. I understand the current designation by the IMF of GOG (Government of Greece) receivable is "in arrears."
My wife bought euros for $0.90 each in Spain today.
Every fiat currency in history has ceased to exist, in time. Those that exist today will have a transient existence like their predecessors, doomed to be ruined by their issuers whose appetite for more knows no bounds.
When a regime or collection of regimes (OECD and IMF as examples) and media mouthpieces use the term "austerity," they mean, "a reduction in the rate of increase of government spending" or alternatively, "spending less than budgeted" or "reducing the skim as a percentage of the government GDP numbers." They don't mean "living within your means" and only sometimes do they mean "meaningfully reducing government handouts," though this would usually not be for the government workers and former government workers.
http://www.zerohedge.com/news/2012-10-31/greece-releases-another-budget-hilarity-ensues
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