Election result

Forums Living in Greece General Discussion Election result

This topic contains 127 replies, has 13 voices, and was last updated by  kiwi 1 year, 10 months ago.

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  • #158595

    kiwi
    Participant
    Aristotelic

    So…are you all numb or something? No comment?

    Feels like a fresh breeze might be passing through Greece. Let’s hope the youth can make some good changes. The same old, same old of the past had gone to seed.

    It will be interesting to see how the markets react this week, and anyway from a female point of view looking at Young Alexis sure beats daily feasting on some of the past uglies 😆

  • #194106

    altohb
    Participant
    Hoplite

    I think we are living in “interesting times”, Kiwi. I just had a thought that Tsipras woke up this morning and thought “oh s**t – now I have to make good on all those promises and make it work!”

    I see that the Independent Greeks have agreed to becoming coalition partners. At least they haven’t faffed around for ages and will form a government quickly. How the discussions with the Troika will go remains to be seen. My gut feeling is that they might just pull it off to a certain extent, as the international lenders will be more worried about bigger countries (like Spain) following suit and electing an anti-austerity party than they are about Greece trying to re-negotiate the terms of the loan repayments.

    Whatever happens, I can’t see the lives of ordinary people in Greece improving any time soon. :(

  • #194107

    Shazzie
    Participant
    Oracle

    It seems the markets are biding their time – no decision either way until the next Troika payment is due in February.

    Either way, I fear altob is right – the average Giorgios in the kafeneion won’t see things improving anytime soon.

    Maybe time to start praying or exercising the power of positive thinking !!!!!

  • #194108

    KP
    Participant
    Aristotelic

    Mind power to make things go well?… interesting big bang theory, or rather, in this case, big bank theory! :roll:

    You better practice calling everybody ‘brother’ to fit into the new Greece, though I wonder if mind power will stop the lefties from grabbing all the ex-pat’s houses for the people and tax all foreigners to the hilt for the privalage of living in Greece? :mrgreen:

    Zito the revoloution brothers!!! All the pauper party is behind you and wishes to join the coalition! :))

    (by the way… I had a nice pic of Sheldon in Big bang theory doing his ‘mind power’ thing and I can’t upload anything! Is the system playing up?) :

  • #194109

    kiwi
    Participant
    Aristotelic

    Last I heard he was entering into a coalition with a center right wing party. Hardly the trumpet call of a commie revolution. If he makes the shipowners and the elite tax avoiders pay a share instead of just creaming it off the pensioners and the common folk then maybe something will change in Greece, though I can’t see this happening very easily. The rich have their ways…..

    I just hope he won’t become another poodle. Everyone deserves a chance and he is clean and fresh rather than the same old school money grabbers Greece has had in tandem for the last umpteen years. At least it won’t be boring.

    May I live to not eat my words.

  • #194110

    KP
    Participant
    Aristotelic

    Kiwi, I’m very inclined to agree with you…. I really do feel that if anybody potentially has the guts to stand against the wrath of the Greek oligarchs, it’s him….. as you say, let’s hope that he doesn’t just become assimilated into the establishment and just become another poodle!
    If he can’t push through changes, then there is just no hope for Greece!
    A social upheavel of mindblowing proportions is needed and the only person with any hope of pushing them through is somebody who just doesn’t care what they’re thought of and even hold the establishment in contempt!
    Oh goodness! Listen to me! I’ve swung the ‘other way’! 😯 I’m becoming a, a, a, an unmentionable!…………. ic_shock I’m becoming a socialist! ic_shock

  • #194111

    the reiver
    Participant
    Oracle

    @altohb wrote:

    Tsipras woke up this morning and thought “oh s**t

    He’s talked the talk, now it’s time to walk the walk. However , if he can sort the corruption for a start, then we’ll see.

    @KP wrote:

    grabbing all the ex-pat’s houses for the people and tax all foreigners to the hilt for the privalage of living in Greece?

    Not quite the former, but they are pursuing foreigners for tax (me & Mrs R) religiously. We are audited every year ! :

    @kiwi wrote:

    The rich have their ways…..

    Very true Kiwi. I was told by a Greek many years ago that the rich do as they like, the poor do as they’re told (by the church) and the rest “find a way” (usually the brown envelope) :nod:

    All in all, this was on the cards because of the conditions prevailing in Greece for the past few years. Mind you, there are not many poor Greeks down here in Mani. The Messinia voting was 38% ND and 32% Syriza.

    No doubt more to write about tomorrow, but not ’til after Andy Murray plays.

    8)

    ps Demis Roussos has died. :( , and the kilted Greek is being knighted by Australia. 😐

  • #194112

    kiwi
    Participant
    Aristotelic

    As you say kp, guts does come into it. I applaud him for choosing to go against all past protocols and being sworn in seculary (since this is his personal belief system) and also of meeting the Russian diplomat first rather than racing off by supersonic jet to the U.S before breakfast, then laying a wreath for those killed by the Nazis thereby giving Merkel the middle finger message…all tell me that so far he is a rebel not a poodle. Every country has their historical heroes and this young man is still beyond our cynical age where we already know how the system works and who runs it. He still wants to buck it.
    If they don’t bump him off or threaten his kids and life as happened with Karamanlis when he dared to choose what he thought was best for Greece and go with the Russians instead of the Yanks…maybe we will see change.

    It’s time to have an open mind and support a change of recipe because the same recipe makes the same cake.

  • #194113

    sundodger
    Participant
    Homeric

    Time to get with the program….Power to the people comrades, the red flag already flies over to spiti mou :))

  • #194114

    kiwi
    Participant
    Aristotelic

    http://www.zerohedge.com/news/2015-01-27/it%E2%80%99s-not-greeks-who-failed-it%E2%80%99s-eu

    A few valid points to ponder. Looks like the new Finance Minister is a breath of fresh air too. It seems to me the new concensus is that it’s not about right or left wing, it’s finally about what’s best for the majority and the country.

  • #194115

    KP
    Participant
    Aristotelic

    Only time will tell on all these things………. so meanwhile, we need to do a Sundodger and fly the flag and cheer on whoever is up top of the pile at the moment! :mrgreen:
    Greeks have learnt to survive centuries of various changes by just changing hats each time to support the guy on top…. they even have a word for it, which doesn’t really translate easily into English, ‘to sinferon’ :))

  • #194116

    Sancho the Fat
    Participant
    Neophyte
  • #194117

    kiwi
    Participant
    Aristotelic

    Sancho I would hope that the fall of Berlin comes with a Greek flag and hymn. I must say though that there is a fresh feeling of hope emanating from the masses. Power to the people. I heard an old Greek chap tearfully saying that he was willing to starve and to dig the soil with his fingers in order to support this new PM. It feels as if people are willing to suffer so that Greece can stand up again and this is because for the first time in many years, a clean person has come into power rather than the same old corrupt cronies.

    Let’s hope Alexis is never corrupted. I like that he has stopped the sale of the most lucrative state owned business’ power and ports to negotiate a better deal for Greece. The last Govt was negotiating these behind closed doors with backhand deals that filled personal coffers. :finger:

  • #194118

    Sancho the Fat
    Participant
    Neophyte

    These two are interesting :

    1. An article by Paul Mason in the Guardian yesterday, on the election campaign – http://www.theguardian.com/world/2015/jan/28/greek-people-wrote-history-how-syriza-rose-to-power

    2. An interview on Real News, about the new cabinet – http://therealnews.com/t2/index.php?option=com_content&task=view&id=31&Itemid=74&jumival=13071

    :thumbsup:

  • #194119

    kiwi
    Participant
    Aristotelic
  • #194120

    kiwi
    Participant
    Aristotelic

    Morning here and I just scrolled through that live report. That young leader has such an infectious grin. Schultz is commenting on his not wearing a tie in some photos.

    I note the stocks are rallying. Good signs. The old saying, 95% PR and 5% work seems to be working for Tsipras.

  • #194121

    Sancho the Fat
    Participant
    Neophyte
  • #194122

    kiwi
    Participant
    Aristotelic

    The meeting with Jeroen Dijsselbloem, who heads the eurogroup of finance ministers will be a tough one. He is thin lipped and not known for his softness and charm.

    On the other hand Russia’s offer could be the big stick that waves the EU into thinking twice.
    http://www.zerohedge.com/news/2015-01-29/putin-pivots-back-russia-confirms-willingness-provide-financial-aid-greece

    Well at least it’s not dull and heads under anymore. Anything could happen and that excitement could be enough to breathe life into the past stagnation.

  • #194123

    kiwi
    Participant
    Aristotelic

    A picture paints a thousand words. Jeroen’s body language, narrowed eyes and tight lips tell the story no words required. It’s becoming a battle of wills and nerves and the old saying comes to mind, that the man with the money makes the rules…

    What will happen to Greece?

    http://www.theguardian.com/business/blog/live/2015/jan/30/greece-awaits-meeting-with-eurozone-finance-chief-live-updates

  • #194124

    KP
    Participant
    Aristotelic

    The Greeks are playing a dangerous game using the Russians as a bargaining chip…… The Russians are the world’s masters at manipulation for their own interests and although the Greeks think that they’re using the Russians to manipulate the EU, the Russians will run rings around them, manipulate them like the masters they are and then spit out Greece!
    Greece is playing with fire and their ego is telling them that they are in control, when they will be anything but! 😕

  • #194125

    Sancho the Fat
    Participant
    Neophyte

    http://www.bbc.co.uk/news/world-europe-31067473

    Sounds OK. It’s fun seeing the right / rich bankers / EU politicians etc getting wound up :))

  • #194126

    Sancho the Fat
    Participant
    Neophyte

    @kiwi wrote:

    A picture paints a thousand words. Jeroen’s body language, narrowed eyes and tight lips tell the story no words required. It’s becoming a battle of wills and nerves and the old saying comes to mind, that the man with the money makes the rules…

    What will happen to Greece?

    http://www.theguardian.com/business/blog/live/2015/jan/30/greece-awaits-meeting-with-eurozone-finance-chief-live-updates

    On the subject of body language at the meeting – http://www.bbc.co.uk/news/world-europe-31066486 :))

  • #194127

    KP
    Participant
    Aristotelic

    An old Marxist anarchist like yourself is bound to be loving all this Sancho! :mrgreen:
    Can’t wait to see the 100 review when we get there! :mrgreen:

  • #194128

    Sancho the Fat
    Participant
    Neophyte
  • #194129

    kolofarthos
    Participant
    Homeric

    hmm yes Sancho, and they are not the only ones worried.
    Greece did need to do something to get change and drag itself out of the mire irrespective of whose fault it was that the country got there in the first place. I think KP’s right and there will be a lot of brinkmanship acted out over the near future.

    I’m not one of the left/right, capitalists/socialists people but one of the greyer majority. Hardly anything is black and white. Many Greeks are in a dire situation and need pressure taking off their finances and work but nationalist policies, whatever the colour, may not achieve it but it certainly stimulates at the moment!

    and I never forget (I hope) that it is not really them and us, worker and manager/banker/politician, Greek non Greek etc. Most of us “workers” rely on someone else even if it is to make a bit of growth on our pension and ensure we can rely on it. { definition of worker? Somebody who thinks others are better of than them or don’t get their hands dirty?}

  • #194130

    kiwi
    Participant
    Aristotelic

    Well it is getting interesting though scary for anyone with money in the banks.

    http://www.zerohedge.com/news/2015-01-31/ecb-threatens-athens-bank-funding-cutoff-if-no-deal-one-month-february-28-now-d-day-

    And http://www.zerohedge.com/news/2015-01-31/caught-tape-dijsselbloem-varoufakis-you-just-killed-troika

    http://www.zerohedge.com/news/2015-01-31/greeks-turn-gold-bank-bail-and-drachma-risks

    Is worth reading the comments below the articles. Many of them are from people in finance and some of the advice and links they provide are useful. One was on the laws of banking and the 😆 😆 safety 😆 of your deposits and I don’t mean just in Greek banks.

    Well we certainly won’t be bored day to day.

  • #194131

    The Real Stoupaman
    Participant
    Hoplite

    Not being very well up on these things, would it be wise to remove our money (euro’s) from our Greek bank or play the waiting game?
    Is our money (not that much, just living allowance stuff, the bulk of our savings are in our UK banks) safe in our Greek bank?

    We noticed in Kalamata on Friday that the banks were full to the brim with customers (no doubt taking money out etc) and the queue’s at the ATM’s were quite long too.

  • #194132

    kiwi
    Participant
    Aristotelic

    Nice to see a fresh face stoupaman.

    In my opinion.

    EU law says that bank deposits are guaranteed to 100k. Even in Cyprus when the banks had a bail in, people were left with their deposits under 100K. Greece is still in the EU and you can see a lot of effort going into keeping it there from a lot of leaders. The fear is that if the peasants in one country become desperate and riot, this will spread, and there are more peasants than leaders. Personally I think they will come to the party in the end and not let Greece step out. There is a lot of blustering to promote fear and compliance.

    When I lived in Greece up to a few months ago, I always had a good sized stash of cash money in different country denominations, Pounds, dollars, euros and Singapore dollars. Greek euros numbers begin with the letter ‘Y’ I kept this stash hidden for a rainy day and always travelled with it on my person. I also kept a few gold coins. My mother used to teach me that one must always have a small hidden stash. I think the old saying applies. Never keep all your eggs in one basket.

    Since the bulk of your money is in UK it is as safe as the fine print in the banking manifesto…ie NO bank is safe! Once your money is in the bank, legally the bank owns the depositor’s funds as soon as it is put in that bank. Your money becomes the bank’s and we become unsecured creditors holding IOUs or promises to pay. All banks have now quietly agreed to bail ins should the need arise. That means they can swoop in and grab your money, including here in New Zealand.:finger: Google the words Bail in.

    So..we are all in the same boat unless we own a large ginger jar of gold which I believe KP has two of. :mrgreen: and we live on the prayer that no one will rattle our cages too much, because there are more of us than them.

    Don’t rely on my comments. Each must do what their common sense tells them. We but share our collective ideas.

  • #194133

    kiwi
    Participant
    Aristotelic

    Seems the leader of the ‘free’ world is supporting Greece. Maybe we can take that as a good sign?

    http://www.thetoc.gr/eng/people/article/obama-greece-needs-a-growth-plan-not-more-austerity

    Also a good Greek English site to keep abreast of news.

  • #194134

    Sancho the Fat
    Participant
    Neophyte

    A report and Interview on Al Jazeera, on Syriza, austerity, democracy, the oligarchy and the media

    http://www.aljazeera.com/programmes/listeningpost/2015/01/greece-syriza-austerity-media-150131104006078.html

    and an interesting article in yesterday’s FT

    February 1, 2015 2:56 pm

    Grexit is an avoidable catastrophe for the eurozone

    Wolfgang Münchau

    Those who play down risks are good at counting but not at grasping the dynamics of a default

    The past week reminded us of three truths. The first is that the eurozone crisis will not be over until it is resolved, that is, when the excess debt is written off. This truth is impervious to mood swings in Davos The second is that something that is unsustainable will have to stop sometime. We saw this when the Greek electorate put an end to a policy that failed to deliver, even on its own narrow terms, a fall in the debt burden. The third is that accidents happen.

    Of all foreseeable accidents, the potentially most catastrophic would, of course, be Grexit — a Greek exit from the eurozone. This could happen but it is by no means inevitable.

    He could not be more wrong. In fact, I believe that the consequences of Grexit are likely to be as damaging to the eurozone as they would be to Greece itself. Those who play down risks tend to be good at adding up numbers but not at grasping the complex dynamics of a default on such a scale.

    We should recall that US policy makers misjudged the impact of the bankruptcy of Lehman Brothers in 2008 for similar reasons. It was not the impact on those directly exposed to Lehman losses that mattered; what mattered were the vast global ripple effects.

    If Greece were to leave the eurozone, the prices of shares and other assets would slump across Europe. A lot of people — and not only those with direct exposure to Greece — would be caught wrongfooted. At that point, investors will wonder whether the eurozone is still a monetary union or just a loose single currency regime with wide entrance and exit doors. They will immediately question whether Portugal is safe.

    Also consider the wider political consequences. Grexit would leave Greece outside the eurozone but inside the EU. Would the EU be able to count on continued Greek support for sanctions against Russia? Would any rational policy maker want to deal with issues such as these for the sake of a few billion euros?

    And what would Grexit mean for Greece? It may be catastrophic, though this would depend on how it is managed. Of the various bad outcomes, the absolute worst is a continuation of policies that have no chance of working and are not supported by the Greek electorate.

    The best outcome would be debt relief combined with a shift from a fiscal surplus to a fiscally neutral budget, plus reforms to deal with corruption and tax collection. I believe these are still goals worth pursuing before resigning oneself to Grexit.
    The new Syriza-led government’s stated goal is to achieve both a reduction in the total debt burden and the fiscal surplus that was agreed with the
creditors.

    I, too, favour a grand conference of creditors and debtors that ends with an agreement to reduce the debt level to a sustainable level and immediately puts a halt to austerity.
    I doubt such a grand bargain can be achieved in the next five months or so. The best outcome I can see is a compromise to refinance the government and banking system, ending austerity and placing the focus on growth. The debate about a grand debt conference would wait until later.

    Is such a compromise realistic? The biggest challenge for the new government is to overcome the dominant economic narratives circulating in European capitals. However, its negotiating position is not hopeless.

    The discussions between Greece and its creditors will almost certainly go down to the wire. Several deadlines lie ahead in the next few weeks and months.

    Alexis Tsipras, prime minister, and Yanis Varoufakis, his finance minister, are correct in their economic judgment but they should remember that there is a fine line between the right and the righteous. The various unilateral pronouncements last week were not a good start.

    What if Mr Tsipras miscalculates? Or the creditors? The Greeks would no doubt interpret a “take-it-or-leave-it” stance by creditors as an act of economic violence.

    If they are forced out, they might seek closer financial ties with Russia. I struggle to see how the EU could conceivably find that desirable. All parties should realise that Grexit would constitute an irreparable failure of economic diplomacy.

    If it were to happen, we would no longer just talk about Greece but the future of the euro and the EU itself.

    http://www.ft.com/cms/s/0/846394e8-a7e9-11e4-be63-00144feab7de.html#axzz3Qa7BuIqb

  • #194102

    kiwi
    Participant
    Aristotelic

    Seems that the newbie government is just going to repackage the same carrot, and rename it an orange. Interest only payments with an extension of term and still pay the principal at the end of the extension. The game’s not over yet though methinks.

    http://www.zerohedge.com/news/2015-02-03/back-square-one-germany-throws-all-over-varoufakis-proposal-greek-plan-half-baked

  • #194103

    kiwi
    Participant
    Aristotelic
  • #194104

    kiwi
    Participant
    Aristotelic
  • #194105

    kiwi
    Participant
    Aristotelic
  • #194099

    kiwi
    Participant
    Aristotelic

    http://www.zerohedge.com/news/2015-02-05/shunned-greece-agrees-boost-economic-cooperation-russia?page=1

    When the ECB slammed it’s door on Greece what did they expect. It’s called putting the shoe on the other foot.

  • #194100

    KP
    Participant
    Aristotelic

    The government are stepping up the ante as the EU does the same and we’ll all be the losers while we wait to see who blinks first!

    http://www.parikiaki.com/2015/02/greek-german-ministers-clash-as-ecb-snub-hits-athens-banks/

    With the government needing to pretend that they’re still in control and that this is all part of the master plan, watch out for the ‘populist’ moves designed to show that they are in control and are the people’s party!
    As the odds stack against them faster and faster, the big move on Greek bank deposits WILL be made… it’s not a matter of ‘if’, but ‘when?’. We may even find that they make their hit on deposits considerably lower than the hit made previously by the Cypriot government. 😕 Hence the mass exodus of cash from Greece which will just encourage an even earlier attack on deposits!

    The final nail in this financial coffin, as if there aren’t enough, is the government’s intention to begin to reinstate public sector workers who had previously been culled!!!! 😯

    Oh dear, where will it all end……….??? :(

  • #194101

    kolofarthos
    Participant
    Homeric

    I think you could be right KP!
    :(

    ….but has the run on the banks not already started, if perhaps with not much momentum yet? I have read reports of queues of depositors removing Euros – no personal experience of it though, stock market nervous and down etc.

    It will be popular in some quarters re- employing some public workers, some sort of stimulus is desperately needed but I’m not sure that will be the right one!

    Coseying up to Vlad the impailer, sorry Put in, is perhaps a good bargaining chip for Alexis, but a very dangerous move.

    Only thing that is certain is that it will end…….but who knows when and with what fallout.

  • #194094

    Alien
    Participant
    Oracle

    Re-employing public workers? Do these people have any idea when (or if) they will be paid?

  • #194095

    kiwi
    Participant
    Aristotelic

    So S & Poors have just downgraded Greece from B to B minus. The Americans have done an about turn and telling the tieless boy he needs to obey. Interesting that the Turkish Lira also just crashed. Would that be the Turkey that Greece was considering a joint venture with Russia for gas? Funny thing about timing and surprisingly at a period when the U.S. by looking at photos, diagnosed that Putin has Asbergers AND Autism. The show continues.

    Let’s just hope Greece doesn’t now get accused of hiding weapons of mass destruction and becomes the new Iraq or that the new leader is termed a danger to democracy and Greece gets carpet bombed to help free the people. After all, we do also have our own reserves of gas and petroleum just like those other unfortunate countries being ‘protected’ by bombing the bejeebas out of them. Cyprus was buddy buddy with Russia too and look what happened to their money…and what a shame, they have all that gas in their sea just waiting to be mined, just like Greece.

    It’s a dirty, dirty game.

    The Chinese are being very quiet and I wonder if they might come galloping by on a white steed. Saddest of all is the ones that suffer most are the old, the young, and the ordinary. best to have a plan B in place folks.

    Kp those ginger jars must be ready for transportation about now.

  • #194096

    kiwi
    Participant
    Aristotelic
  • #194097

    Sancho the Fat
    Participant
    Neophyte

    @kiwi wrote:

    Interesting article from the Greek Fin MIn, Varoufakis.
    http://yanisvaroufakis.eu/2013/10/25/the-dirty-war-for-europes-integrity-and-soul-europe-inaugural-public-lecture-uws-state-library-of-new/
    Lots of historical information.

    Thanks very much for that. It makes his thinking very clear. reb_bravo

  • #194098

    kiwi
    Participant
    Aristotelic

    I don’t know how everyone here feels about Tsipra, but so far I think he is a breathe of fresh air. Someone standing up to the stupidity of the past and trying to make changes to help the MAJORITY. Seeing these fresh young faces who don’t have the family jewels to protect and who appear to be actually trying to make sensible changes, like reinstating the rights of collective bargaining and workers rights seem to be impressing even the Americans. My feeling is that the ultimatums will all fall apart and Greece will stand up. From my lips to Gods ears…

    http://www.zerohedge.com/news/2015-02-08/greeks-cant-take-more-disappointment-defiant-tsipras-rejects-eu-ultimatum-demands-br

  • #194093

    kiwi
    Participant
    Aristotelic

    This is getting interesting…http://www.businessinsider.com.au/russia-military-agreement-in-cyprus-2015-2

    Imagine the chagrin if Greece also decides to allow a military base. You can see why the US is feeling nervous about Greece and pressing Merkel to soften the stance.

  • #194090

    KP
    Participant
    Aristotelic

    Okay, so already more ‘populist’ vote garnering by the government!

    http://ekathimerini.com/4dcgi/_w_articles_wsite2_1_10/02/2015_547087

    Looking for short term gains in popularity from those who have lost or stand to lose their jobs through sheer inefficiency, against long term stability and jobs for everybody!

    What is their problem? They’re already starting to reverse the last years of laying the foundations for building a new more efficient and more profitable Greece, by looking to ignore those foundations already built and simply build what they want on sand! :angry:

  • #194091

    kiwi
    Participant
    Aristotelic

    It ain’t over till the fat lady sings.

    We need a poll on GIH to see what members think will happen. My gut feeling is that there will be a last minute bailout and all this fuss is just posturing. I hope I am correct.

  • #194092

    KP
    Participant
    Aristotelic

    Kiwi…. The problem is that if you set up a poll to see what we think will happen, I won’t know how to answer!
    I can see and guess what they’re actually doing as they do it, but I can’t begin to guess what MIGHT happen or where they, the EU and Greece will go from here….. apart from guessing that it won’t be pretty! :retard:

  • #194089

    kiwi
    Participant
    Aristotelic
  • #194086

    kiwi
    Participant
    Aristotelic

    Looks like the no tie and hands in pocket approach is working reb_bravo I just heard that the name Troika is no longer, and that they are now talking on a more positive footing. Maybe they are getting used to the fact that the lackies they had in their pockets before are gone and these new boys won’t play that game.
    Fingers crossed for little Greece.

  • #194087

    kolofarthos
    Participant
    Homeric

    At least they are talking http://www.bbc.co.uk/news/world-europe-31446565 but it is early days yet and most of EU is more concerned at present with Ukraine situation. I guess nobody has blinked yet!

  • #194088

    kiwi
    Participant
    Aristotelic

    My feminine intuition after seeing the huge smile Merkel gave Alexis is that this will happen. I also noted that they sat opposite one another at the meeting…more opportunity to warm up. Her smile was wider than usual and bright. No dour looks.

    Don’t forget success is 95% PR and 5% work.

  • #194085

    Sancho the Fat
    Participant
    Neophyte

    There’s a piece on the BBC World News front page on ‘the chic Greek’ –

    http://www.bbc.co.uk/news/world-europe-31452402

    :mozilla_cool:

  • #194084

    Sancho the Fat
    Participant
    Neophyte

    In the FT this evening:

    February 15, 2015 2:36 pm

    Athens must stand firm against the eurozone’s failed policies

    Wolfgang Münchau

    One of the riskiest options would be a formal exit from the currency union

    The Greek finance minister can expect a frosty reception on Monday where he will confront his eurozone colleagues in another ‘high noon’ European showdown . My advice to Yanis Varoufakis would be to ignore the exasperated looks and veiled threats and stand firm. He is a member of the first government in the eurozone with a democratic mandate to stand up to an utterly dysfunctional policy regime that has proved economically illiterate and politically unsustainable. For the eurozone to survive with the current geographic remit, this regime needs to go.

    Of course, for Greece to stand up to the EU policy elites is risky. The consequences of a failure to agree a deal have to be well understood. Greece might risk a financial collapse, and with it a forced exit from the eurozone. The concrete issue under discussion is a new loan to Athens to cover its funding needs for the next few months. The argument is not really about the money. It would only take a couple of economists in a pub with a pencil and a few beer mats to do the sums.

    The dispute is about the packaging. The Greeks want a simple bridging loan combined with an implicit acknowledgment that the previous support programmes have failed. Others disagree. The Germans support austerity on ideological grounds. The Portuguese oppose any deal for Greece as they have taken their austerity medicine and did not stage an insurrection. And the Lithuanians are saying: we are even poorer than you are. Why should we bail you out? And so on.

    So what should the Greek government do? They should stick with their position not to accept a continuation of the existing financial support programme. By doing this they would no longer be bound by self-defeating policy targets such as the contractual requirement to run a primary budget surplus of 3 per cent of gross domestic product. For a country with mass unemployment, such a target is insane. It would, of course, be better for this nonsense to stop while Greece remains in the eurozone. But the most important thing is that it has to stop.

    If this is not feasible, Athens would need to prepare a Plan B. This does not necessarily mean a formal exit from the eurozone, which would be one of the riskiest options. There are smarter choices to pursue first.

    The most sensible one is the introduction of a parallel currency — not necessarily paper money, more like a government-issued debt instrument that can be used for certain purposes. A number of economists have been thinking along these lines. Robert Parenteau, a US economist, has proposed what he called “tax anticipation notes”. These are IOUs backed by future tax revenue. Such instruments exist in the US at state level. They act as a tax credit that allows governments to run a fiscal deficit until the economy recovers. With such an instrument Greece could abandon austerity without abandoning the euro.

    John Cochrane, a conservative economist at the University of Chicago, also wants the Greek government to print IOUs. They would be electronic money, not necessarily cash and would be used to pay pensions and other transfer payments. The IOUs would fulfil one of the core functions of money — a medium of exchange. You can use them to buy food in the grocery store or to recapitalise parts of your banking systems.

    And what no one is saying — at least not in polite company — is that once this system is in place, you can default on the official European creditors. What can they do? They cannot eject you from the eurozone. They have no legal means to do so. They cannot kick you out of the EU either. They still need your assent for treaty change, or any policy requiring unanimity, such as the renewal of the sanctions against Russia.

    The riskier alternative would be a hard exit — Grexit. This is an option Greece should try to avoid because it is hugely disruptive. But the scale of the downside of this, at least for Greece, depends on how it is managed. Grexit would be potentially more dangerous for the eurozone itself because it could be a seen as a template for others, especially in the absence of an economic Armageddon in Greece. Yet, while not desirable, Grexit would still be preferable than the status quo.

    The worst-case scenario would be for the Greek government to blink first, and accept defeat. If Syriza were to be co-opted into the policy consensus, the only political party left to oppose these policies would be Golden Dawn, a neo-Nazi party.

    My preference would be for the eurozone as a whole to abandon the failed policies of the past five years, and move on. If that proves politically impossible, the second best option, for Greece at least, would be a semi-exit with a parallel currency and a default on official creditors only. Either way, they will need to stand their ground on Monday.

    http://www.ft.com/cms/s/0/175f6634-b2d3-11e4-a058-00144feab7de.html#axzz3RqcT6Xn6

  • #194080

    kolofarthos
    Participant
    Homeric

    Wish I had the brains to understand how a parallel currency would work. I am simple in that respect. Surely an IOU is only worth anything if a) it is accepted by the creditor being of value in the future with b) an acceptable risk level for redemption or c) passable to another who also accepts the risk etc. etc. Such as a promissory note like the pound sterling paper.

    Now I ask myself would I take that risk if the Greek government promised to pay me at some time in the future?
    …or have I missed something?

    Without realisable assets greater or at least consistent with debt levels and no realistic plan to get to that situation or a very big carrot who will accept the IOU? Would it just be internal to Greece with companies/ employees working with the promise of something intangible in the future?

    I can see, if it worked, how it might just kick start the economy but would that then help the Euro debt or just substitute or add to it?

    Somebody explain, please…

  • #194081

    Sancho the Fat
    Participant
    Neophyte

    I don’t understand it myself. Some of the commenters seem to know what it’s about, though. To get round the FT paywall, google ‘Athens must stand firm against the eurozone’s failed policies’ and click on the first result you get. :mozilla_cool:

  • #194082

    kolofarthos
    Participant
    Homeric

    You must have a magic touch, Sancho, as that does not work for me!

  • #194083

    Sancho the Fat
    Participant
    Neophyte

    I should have mentioned that first you have to clear your history and cookies (or at least any cookie called ft.something). Anyway, comments so far – apologies for formatting

    riskstrategies 1 minute ago
    Everybody seems to be focusing on the possibility/probability of Greece leaving the Eurozone.
    Perhaps it is times to consider who is the odd man out in the Eurozone. Clearly the leading candidate is Germany. Why not have Germany leave the Eurozone and readopt the DM.
    I can think of a few advantages for all concerned.
    Germans would be happier with their own DM. The DM could then become an additional reserve currency. The newly recreated DM would find its own level and marginally affect German exports which are not particularly price sensitive.
    The rest of the Eurozone countries would breathe a sigh of relief, the Euro would decline in value and improve export performance the remaining countries and reduce their imports. There would be less of a need to bail out Greece and other countries (Portugal, Spain, Italy, Ireland) in a similar situation. The remaining Eurozone countries would then be able break out of this vicious circle of non performance which ha lasted since about 2009 and which does no seem t b ending any time soon..There could also be a salutary effect on deflation currently menacing most of Europe.
    France would then become the lead Euro country whose economic model is more consistent with the remaining Eurozone countries.
    In terms of geopolitical considerations, France could improve its stature within Europe and as leader of the Eurozone could stand up to German somewhat more effectively.

    Lino 8 minutes ago
    >They act as a tax credit that allows governments to run a fiscal deficit until the economy recovers. With such an instrument Greece could abandon austerity without abandoning the euro
    it’s called debt without interest rate: and when could they be redeemed? And it would be a forced load imposed on greeks, since noone outside would want any of it.
    Will they pay pensions/suppliers/civil servants with it?

    Borges 24 minutes ago
    Dear WM, this idea of the Greek government issuing a “complementary currency” in the form of “tax IOUs” reminds me of Argentina in the ’90s. There provinces short of cash from the central government (tied to the USD) started issuing these “complementary currency”. Then, the central government issued its own “complementary currency” of a similar sort – see http://en.wikipedia.org/wiki/LECOP.
    This all ended badly and Argentina eventually defaulted.
    Maybe these IOUs could be a way to prepare a default on the official debt holders. But it would be equivalent to creating a local currrency – used only to fill the unavailability of euros locally, but not accepted for international trade (still a big problem for Greece). This “local currency” obviously would tend to devalue greatly and it would create a mess in balance sheets denominated in euros. In the end this would be a way for Grexit.
    There are no free lunches.

    Olaf von Rein 10 minutes ago
    @Borges WM wants Greece to default and follow the Argentine lead. He wants the EZ to fall apart too. Not for the betterment of its people, just so that he can turn around and say “I told you so” (every week for the past 5 years).
    What is less clear is why Greece should take advise from someone who has been so consistently wrong on virtually everything? (Mind, WM could be that broken clock whose time has come around again…)

    John Smiles 26 minutes ago
    Greenland left the EU in 1985 or thereabouts, it didn’t seem to affect the community and in fact more new members have joined.
    Why do we think a Greek exit from the Eurozone, a smaller club, would be any different?

    ExPM 30 minutes ago
    Just maybe the shoe does not fit and never did do. If you cheat your way into an elite school and start failing the exams and disregarding the house rules what should be the solution. Give you some bonus points to pass regardless of the others?, change the rules?, cruelly have parents insist that the ill-prepared child comply and kill themselves hopelessly trying to catch up?….. or have them leave with a package of help and an invitation to re-apply when they are better prepared.

    Dulwich gal 11 minutes ago
    @ExPM I agree with you. But for me, the issue is that the teachers of the school (to continue your example) knew the pupil/parents couldn’t pay but fudged the entrance fee. So they’re as much to blame.

    Caminero 37 minutes ago
    What Wolfgang Münchau proposes amounts to creditors sending fiscal transfers to Greece. This is because if Greece gets additional money, it will not be able to pay it back – today’s debt burden is the upper limit of what just may be sustainable. So Europe would become a fiscal union with transfers to the those in a humanitarian predicament.
    It is true that the stabilisation we have seen was dominted by creditors’ interest. It is true that the social crisis has come with humanitarian costs that are high and deploreable.
    Still, just as Wolfgang roots for the Greeks, I would root for the creditors.The creditors political elite has extended itself to the limit, financing a huge debt without a popular mandate. Going farther would not find a majority in the creditor countries. Being in the euro zone does not come with being fully insured. Also, transfers would significantly lower fiscal discipline in Greece. As an economist, this is a nightmare for the implications in terms of justice. I appreciate that Wolfgang has a soft spot for the humanitarian side of things. But not even mentioning the justice and moral hazard angle and the implications for democracy (in the north) is jumping short.

    Swamp Yankee 26 minutes ago
    @Caminero Agreed. If you’re going to have “transfer”, call it what it is: charity.
    I’m not opposed to charity for Greece. If they do not need it now they will by the time the denouement is at hand.

    FrankP 39 minutes ago
    I totally agree the work ethic imbalance between Greece and the rest of the Euro zone is so large that they cannot hope to survive in a stable currency regime

    RiskAdjustedReturn 20 minutes ago
    @FrankP
    In the US we have some poor regions, too. They use the dollar, but their wages are lower.

    anon13 7 minutes ago
    @FrankP Sweeping generalisations like yours are even lazier than what you accuse the Greeks of being.

    Remember Lincoln 44 minutes ago
    Greece should exit from the euro and do it as fast as possible. If Greece continues to receive aid it will never change in the profound way it should change. The real problem is that Greek people continue to live according to their traditions and far from reality. The proof is their vote in the last election. Perhaps it will be indeed the last democratic election and become a country like Venezuela. But , never mind, they will receive advice from Mr Münchau and Mr Krugmann. Congratulations.
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    FrankP 36 minutes ago
    Totaly agree the sooner they get out the better

    Sideliner 57 minutes ago
    Quite on the contrary.
    The point should rather be made that it’s time for the Germanys, Portugals and Lithuanias of the Eurozone to consider the advantages of Grexit. Because there clearly is a good deal of upside to be had from it too.
    Grexit would certainly be disruptive. Banks would fail, the country would be plunged into an even deeper economic crisis, Syriza would surely blame everyone else but themselves, and critics of the Euro would have a field day. But the Euro project would quite likely survive and, once the costs are discounted, some advantages would emerge.
    For one, it would show the markets that the Eurozone means business. It is quite public that Greece joined the Euro on massaged statistics, so a relatively short, fraught Eurozone membership would seem a rather fitting outcome.
    Second, it would mark the limits of blatantly one-sided decision-making in a cooperative environment. By allowing Greece to go, the message would be reinforced the I-me-and-myself Syriza commandeering style does not belong in any self-respecting club.
    Third, the Eurozone would rid itself of Syriza altogether, an consequence worthy of consideration in itself. For a party that grew important by making impossible promises other people would have to pay for, it would always be hard to stage any 180 degree turn and, hey presto, suddenly allow itself to be perceived as the sort of cooperative Eurosheep it fiercely criticized its political rivals for being. So a Syriza in the Eurozone can be expected to be a persisting source of trouble for years to come.
    Fourth, Syriza will wreck Greece anyway. It is a quite public secret that many Greek taxpayers, emboldened by Syriza’s poll victory, have ceased to pay substantial amounts of tax. Reporting lags mean this isn’t showing in official statistics yet, but it surely will. When it eventually does, the need to address this problem will spell fresh Syriza trouble. Why should the Eurozone let itself be dragged into all of this is quite a fair question.
    Fifth, it would allow hitherto confident voters in France, Italy and Spain see what the actual outcome of voting for the likes of the National Front, Podemos or the Five-Star Movement is. It is a good bet many of them could learn from the experience of Greece.
    But last and foremost, Greece should go because that essentially is what Greeks voted for. They very democratically chose to elect a government who basically promised they would be able to live better not by working harder, saving more, or reforming the worst ways of their country’s governance, but just on Syriza’s supposedly superior negotiating skills. That’s tantamount to electing having Europartners pay the cost of rescueing Greece from its trouble. Well, thank you, but no, thank you.
    Don’t let any of this happen. It’s time to consider the advantages, and start preparations, to let Greece go.

    miller1 1 hour ago
    It’s a bit arrogant to say “and so on” after the comment that Lithuanians wont pay because they are poorer than the Greeks. That is the key point here. Why should countries that are poorer or have higher debt burdens (interest cost vs GDP) pay for the excesses of Greek societies past and present?
    Long time since I’ve heard WM argue the poorest people in society should pay a special tax to help semi-rich people that lives beyond their means, cheated on the taxes on so on, because if they don’t, these people might be able to do harm to the poor. Warped logic. Is the precise function of a civilized society to make sure at thing like this do not happen?
    Between the lines WM is saying that if Lithuanians don’t fund the Greece, Greece can block EU policy that would help them against Russia. Blackmail or asking for help?

    Oh and by the way “tax-credit IOU”…. That might work in a state in the US, with a something similar to a US federal back stop. I don’t see it work in Greece.

    Joe 1 hour ago
    The problem with Greece is that it needs comprehensive structural reform like much of SE. Left wing inspired expansion of the public sector will be counter productive. Extending more credit (in whatever guise) is not the answer. However, Greece’s economic hole is so deep that it cannot escape it without help. Maybe there should be a debt moratorium accompanied by a mini Marshall Plan a la post war Germany but that would require EU unanimity and a more ideologically suited Greek government. So not much hope there …….. Grexit or fudge (kicking the can down the road) her we come.

    Night Watchman 1 hour ago
    Do notice the term “Bridge Programme” !
    Nothing to do with “Bridge Loan ” or “Bridging Loan” !
    Very important distinction.
    We (plural) know that several members of the herd have difficulty in making this distinction (and we have already given several concrete, clear and factual illustrations of this).
    Some pertinent financial training, of course, could help to drive the principles of the distinction home to those experiencing this difficulty (mind you , it is difficult to overcome obtuseness & deliberately flawed, insistent rebuttal ; that probably needs a different sort of remedy).

    Night Watchman 1 hour ago
    PS : Hi, Wolfgang, can you please help, just by correcting this point of “Bridging Arrangement / Agreement / Facility / Programme to help us be rid of the drivel that “the herd” do keep churning out ?
    Obviously, even if Germany & the Dijsselbloem crew do not like it, they do recognise it as a key factor in Greece’s wishes.
    Thanks in advance.

    evert 1 hour ago
    Short of confiscation, I guess that these “tax anticipation notes” will be sold to investors – unfortunately the price of these notes would be very low and I also expect such notes to be part of the government debt, i.e. a part of the deficit.

    Night Watchman 1 hour ago
    Just a few, brief extracts from “EUObserver”.


    https://euobserver.com/economic/127651
    By Valentina Pop , BRUSSELS, Today, 09:27
    — “The new Greek government is maintaining its stance on privatisations and the need for extra time to negotiate a ‘bridge programme’, ahead of crunch talks with eurozone finance ministers on Monday (16 February).”
    — “Greek Prime Minister Alexis Tsipras, however, wants a new programme altogether. This would take months to negotiate and be subject to parliamentary approval in Germany and several other countries.”


    — ‘…. “It is not crucial to extend the current programme, you can also agree to start discussions on a new programme. This is a distinct possibility I would not exclude,” a senior eurozone official said Friday in Brussels….’
    — “But the question remains of how to keep Greece afloat in the transition from the old to a new bailout programme. “
    — ‘……The source added that the International Monetary Fund’s part of the bailout continues until 2016 and downplayed expectations for a final deal on Monday…..”


    Well, someone might be listening to WM !

    Austerian Republic 1 hour ago
    @Night Watchman
    Agreed! As WM says in the article above, “The Greeks want a simple bridging loan… “
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    Night Watchman 1 hour ago
    @Austerian Republic @Night Watchman
    Oh, do go off and read ! He must have made a “slip of the key board” ! You are so infantile ! Read the EU observer !
    You will have to do better than that, Austerian Republic !

    Night Watchman 59 minutes ago
    @Austerian Republic @Night Watchman
    Please give us notice as to when you may feel equipped to make the transition from adolescence to adulthood.

    argonaut 1 hour ago
    Why would anyone, especially a Greek shopkeeper, accept a parallel currency as a medium of exchange except at a huge discount to the Euro ?

    Vash 1 hour ago
    @argonaut Better yet why not citizens pay taxes with the a parallel virtual imaginary currency?

    RiskAdjustedReturn 1 hour ago
    @argonaut “Why would anyone, especially a Greek shopkeeper, accept a parallel currency as a medium of exchange except at a huge discount to the Euro ?”
    Rather than give people money to spend in shops, wouldn’t it be easier to just require shopkeepers to give stuff away for free?

    argonaut 59 minutes ago
    Greece isn’t Venezuela (yet) !

    Olaf von Rein 1 hour ago
    “’tax anticipation notes’ … are IOUs backed by future tax revenue.” LOL. I thought such things were called “government bonds”. You don’t even need to “create” them – they exist in Germany too. For example in the form of state pension promises.
    Of course, Greece is always free to default on its Troika loans – parallel currency or not. To write “what can the EZ do?” however shows a massive lack of imagination.

    Joe Heath 1 hour ago
    If printing money is the good alternative, why are there poor nations in the world?

    RiskAdjustedReturn 1 hour ago
    @Joe Heath And deficit spending is suddenly a wonderful new idea for economic stimulus, as if we hadn’t been doing it already for decades.

    maljoffre 1 hour ago
    Nobel economist Paul Krugman writing in the New York Times:
    “You can argue that Greece brought its problems on itself, although it had a lot of help from irresponsible lenders. At this point, however, the simple fact is that Greece cannot pay its debts in full. Austerity has devastated its economy as thoroughly as military defeat devastated Germany — real Greek G.D.P. per capita fell 26 percent from 2007 to 2013, compared with a German decline of 29 percent from 1913 to 1919.
    Despite this catastrophe, Greece is making payments to its creditors, running a primary surplus — an excess of revenue over spending other than interest — of around 1.5 percent of G.D.P. And the new Greek government is willing to keep running that surplus. What it is not willing to do is meet creditor demands that it triple the surplus, and keep running huge surpluses for many years to come.”

    Swamp Yankee 1 hour ago
    @maljoffre Perhaps Nobel economist Paul Krugman will be as successful in the Eurozone as Nobel Peace Prize winner Barak Obama has been in the middle east.

    RiskAdjustedReturn 1 hour ago
    @Swamp Yankee @maljoffre
    Yes, the Peace Prize winner is getting close to his 5 war limit.
    And if the Nobel committee knows how to run the global economy, they should tell us.

    maljoffre 47 minutes ago
    @RiskAdjustedReturn
    The Nobel Committee does not “run the economy,” they confer recognition on those who have made serious contributions towards its understanding. You can’t even figure that out. You’re the only one who thinks he has with the answers to all the world’s economic problems, and you’re absolutely clueless. All you do is troll.

    RiskAdjustedReturn 46 minutes ago
    @maljoffre @RiskAdjustedReturn
    “The Nobel Committee does not “run the economy,””
    I think I knew that.
    Did someone say that they did?

    maljoffre 41 minutes ago
    @RiskAdjustedReturn
    Yea, YOU did above when you said “And if the Nobel committee knows how to run the global economy, they should tell us.”
    I knew your posts were clueless, but now I find out that even you don’t read them, so there’s no point for me to do anything but toss them in the rubbish bin where they belong. Actually, no, they would only mess up the rubbish bin.

    RiskAdjustedReturn 36 minutes ago
    @maljoffre @RiskAdjustedReturn
    “Yea, YOU did above when you said “And if the Nobel committee knows how to run the global economy, they should tell us.

    No, I said IF they know how they should tell us. I didn’t say that they “run the economy”
    Learn to read.

    maljoffre 28 minutes ago
    @RiskAdjustedReturn
    Really? You’re That desperate to hide your ignorance that you hang it ungrammatically on a conjunction of a dependent clause that confirms the independent one? You are obviously an English As a Second Language (ESL) student and a poor one.

    RiskAdjustedReturn 27 minutes ago
    @maljoffre @RiskAdjustedReturn
    Is English your first language” You seem confused.

    flying dragon just now
    @maljoffre @RiskAdjustedReturn
    Regurgitating the monotonous Krugman hardly adds much.
    As for the trope that austerity has decimated the Greek economy, it has not. The lies told by the Greek government, Goldman et al to gain admission to the Euro and the the shameful acquiescence of the other Eurozone governments at the time did that.
    Austerity is just an attempt to correct the original lie. Of course it cannot work, but then nothing can make the original lie go away, and that’s what would be needed. European governments by accepting Greece (Italy too?) unashamedly conned their electorates; for the supposed greater good where they, the “elite”, were ultimately the real winners. Of course, what they cannot now stand is that Syriza, genuinely and for the first time, stands outside this elite and is the beneficiary of a popular vote against their great plan. something the elite thought impossible – it’s always managed to suppress/correct votes on the project before.
    As for your hair-splitting on Nobel awards, it is boring. You jst need to accept that there are many, myself included, who believe that many of their awards are motivated by factors other than objective excellence. Only those awarded for physical sience appear to a layman to have some legitimacy. For us, the association of Nobel and “expert” is thus oftennegative and far from an automatic endorsement of a view.

    maljoffre 59 minutes ago
    @Swamp Yankee
    really? You know more about the Greek situation than Paul Krugman and other economists including many Nobel winners and all you can do is troll?

    RiskAdjustedReturn 55 minutes ago
    @maljoffre @Swamp Yankee
    Henry Kissinger also got the Peace Prize. Not sure what infallibility is suggested by a Nobel.

    maljoffre 50 minutes ago
    @RiskAdjustedReturn
    Not “infallibility” at all, that’s the Pope, but in economics and other sciences, it confirms knowledge of which you obviously have none. You and the SwampMonster can’t even distinguish between the value of a social science and science Nobel, like the discovery of DNA and a political one like the Peace Prize. Pity there is no Prize for cluelessness because you and the swamp man would be serious contenders.

    RiskAdjustedReturn 48 minutes ago
    @maljoffre @RiskAdjustedReturn
    Oh, please. Krugman has one note, and we all know what it is.
    And Economics is not remotely similar to a science.

    maljoffre 44 minutes ago
    @RiskAdjustedReturn
    Mein Gott! You can’t even read a post! I clearly said the Social Sciences as regards economics and many individuals have made important contributions to the field, an important field. As for “fallibility,” even the hard sciences are “fallible” and are changed in their results. You really have no idea.

    RiskAdjustedReturn 40 minutes ago
    @maljoffre @RiskAdjustedReturn
    Sorry, but constantly referring to Krugman as a Nobel winner is just desperate.
    Bernanke was a candidate for a Nobel, and he nearly destroyed the global economy.

    maljoffre 36 minutes ago
    @RiskAdjustedReturn
    No, I refer to Krugman as a Nobel prize winner to establish his credentials and to inform people like you who have no credentials and no knowledge about anything and offer nothing interesting or valuable. All you offer is spittle and serial trolling and you’re not even good at that.

    RiskAdjustedReturn 33 minutes ago
    @maljoffre @RiskAdjustedReturn
    Actually, you haven’t the tiniest shred of knowledge as to my credentials, so your comment is just BS.
    And I doubt that one-note Krugman was given Nobel for his work on the Greek economy.

    maljoffre 25 minutes ago
    @RiskAdjustedReturn
    I recognise your non-credentials clearly from the clueless posts you write where you cannot even distinguishes between the nature of Nobel awards. By reading your posts, which I will now stop doing, I also have become aware that you lead a lonely and pointless life and that you try to find some meaning in writing mindless spittle on blogs.

    RiskAdjustedReturn 24 minutes ago
    @maljoffre @RiskAdjustedReturn
    I see all your insults but can’t spot any meaning.

    Night Watchman 39 minutes ago
    @RiskAdjustedReturn @maljoffre
    Extraneous to the subjet, RiskAdjustedrReturn.
    Childish attempt at debate deviation. We all see it. It cuts no ice here.
    Lousy return for your key-board operation.

    Night Watchman 43 minutes ago
    @RiskAdjustedReturn @maljoffre @Swamp Yankee
    The Kissinger reference is a flawed, smart-Alec analogy, RiskAdjustedReturn.
    It is extraneous to the debate.
    It is yet another of your immature attempts at debate deviation, worthy of adolescent play-ground talk, when the facts have stifled legitimately all flawed arguments.
    We are not talking about infallibility. The allusion to the Nobel Winners in the context of the debate here, in the Greek context, is in relation to recognition of concrete, relevant contribution ; NOT infallibility !
    In this context, your reference to Kissinger has no such connotation of relevance. And your remark is totally irrelevant !
    Best to keep that sort of level for your tabloid comments

    Night Watchman 38 minutes ago
    @Swamp Yankee @maljoffre
    Perhaps Mr. Obama’s influence here will outweigh that of Germany and the Dijsselbloem crew.

    maljoffre 34 minutes ago
    @Swamp Yankee
    You can’t even distinguish between a prize in the social sciences given to people who enhance our understanding of economics and a political one given for personal and diplomatic reasons. Figures.

    Abacab 37 minutes ago
    @maljoffre
    Krugman wants taxpayers in other countries (the evil creditors) to fork over money to pay for the after effects of a decade long spending binge in Greece. By the same logic he should have encouraged Texans to hand over dollars to California when it ran out of money. In both cases, that’s not how the system is designed.

    Cetero 27 minutes ago
    @maljoffre “Austerity has devastated its [Greece] economy” – does this mean, Greece had a competitive, functioning economy before it was forced into austerity politics by its creditors? Give me a break. Would we believe the earth is flat because a nobel laureate has said this? Greece’s problems did not start with the Troika but much earlier.
    I would have some sympathy if one says that austerity alone does not help if there is no economy which could be made more competitive by internal devaluation.

    maljoffre 1 hour ago
    A deeper and more knowledgable analysis on the Greek situation from Nobel economist Paul Krugman writing in his New York Times’s column:
    http://www.nytimes.com/2015/02/16/opinion/paul-krugman-weimar-on-the-aegean.html

    Itsmeagain 1 hour ago
    Syriza and Varoufakis have won the Greek election in order to save the Greek establishment from real reform. Real reform would mean real change and real change would mean the Greek elite having to give up on its total control of Greek society and the Greek economy.
    Remember: those with official power are the benficiaries from corruption.

    Need to Know 1 hour ago
    @Itsmeagain It sounds like the debt restructuring negotiations should include some of the islands as collateral. Nobody wants to touch that taboo. Why?

    MorganInMadrid 1 hour ago
    Good to read this in the FT. Time for Europe to change tack. Th commitment to austerity in the face of repeated failue is ideological bordering on quasi-religious mania. We can find a way hat is acceptable to the votingmajorities of Greece, Germany and Lithuania. If not, what future for the EU?

    Vintage 1 hour ago
    @MorganInMadrid Not much is the answer. You have hit the nail on the head. There are simply too many diverse interests in an EU that has had a policy of expansion to cover as many countries as possible at all costs without any proper consideration as to how the whole shebang can be run cohesively.

    Cultrun 2 hours ago
    About your first paragraph, Mr Münchau: Any advice for members of “seconds” governments with democratic mandate in the Eurozone to deal with Greece? Or their citizens do not matter?

    BVidet 2 hours ago
    @Cultrun Any particular evidence that these governments have been elected because of their commitment to austerity? Or just any polls indicating a broad popular support for austerity in Europe?

    Age Olav Mariussen 2 hours ago
    The argument that “this medicine is killing us” is 100% correct. The agreement maintains a dysfunctional economic structure, and it efficiently prevents institutional changes. We know this by now, there is no reason to continue this experiment, which forces Greece into eternal decline and misery. The solution is a return to Drachma, followed by a devaluation. After the devaluation, state salaries will be smaller, measured in EURO, and salaries paid by export sectors with access to EURO or other hard currencies will be relatively higher. This will create incentives which will encourage entrepreneurs with innovative export-oriented projects. The export base of the national economy will grow. The state will no longer be an attractive employer. Privatisations can go ahead. Greece will be attractive to FDI. The private sector will grow, and the tax base of the state will improve. What should be discussed today is a collaborative strategy, where an ECB – supported two currency system could be seen as the first step towards an independent currency.

    Need to Know 2 hours ago
    @Age Olav Mariussen What is the likelyhood of the proposed discussion of a collaborative strategy to firstly yield a two currency system and then an independent currency?

    Age Olav Mariussen 2 hours ago
    @Need to Know @Age Olav Mariussen A “hostile” Grexit do raise some very uncomfortable risks, like a fascist takeover. Where is the loyalty of the army?? Once the negotiators realise that a continuation of the agreement is not on the table, they need a plan B.

    RiskAdjustedReturn 1 hour ago
    @Age Olav Mariussen @Need to Know
    “A “hostile” Grexit do raise some very uncomfortable risks, like a fascist takeover.”
    But if Greek public employees get jammed into a huge drop in their standard of living due to the new drachma, aren’t there risks there, too?

    Swamp Yankee 1 hour ago
    @RiskAdjustedReturn @Age Olav Mariussen @Need to Know
    There are two kinds of fascists floating around Europe these days.
    There are the fascists who are Nationalist, Socialist, and who offend the moral vanity of the bien pensant elites: these are called “fascists”.
    Then there are the fascists who are Nationalist, Socialist, and who flatter the moral vanities of the bien pensant elites: these are called “heros”.

    Age Olav Mariussen 1 hour ago
    @RiskAdjustedReturn @Age Olav Mariussen @Need to Know In a small, open economy it is crucial to maintain incentives which increase exports and promote import substitution. This means that wages in sectors which compete globally must be higher than in sectors protected from global competition, such as the public sector, and its domestic suppliers. If this is not achieved through negotiations, it can be done through devaluations.

    RiskAdjustedReturn 1 hour ago
    @Age Olav Mariussen @RiskAdjustedReturn @Need to Know
    Yes, I understand (although, as we have discussed before, you’re assuming that the public sector unions don’t have enough clout to get cost of living raises).
    But the point here regarded political risk.

    Age Olav Mariussen 47 minutes ago
    @RiskAdjustedReturn @Age Olav Mariussen @Need to Know If public sector unions are strong enough, they could ask for and get compensation, and little is achieved. I am quite convinced that if we go deeper into a GREXIT scenario, any govenment will struggle to stabilise the new currency. In that situation, wage compensation is not likely to be a high priority. In the Nordic countries, there are agreements between unions which defines salaries in globally competing sectors as the upper limit to salaries in protected sectors.
    There is a huge political risk connected to GREXIT. It probably could blow up the present government. I guess that is why they try to negotiate. If they do GREXIT, they must be able to blame the Germans. They must also be able to control the streets.

    RiskAdjustedReturn 31 minutes ago
    @Age Olav Mariussen @RiskAdjustedReturn @Need to Know
    “In that situation, wage compensation is not likely to be a high priority.”

    Well, that’s a question of clout and contracts.
    In the US lots of wages are indexed to the cost of living. Same story for social security benefits.
    I’ll grant you that it’s probably politically easier to chop public sector wages in drachmas than in Euros, but you’re suggesting a lot of disruption to put through a pay cut.

    Age Olav Mariussen 23 minutes ago
    @RiskAdjustedReturn @Age Olav Mariussen @Need to Know what is your alternative?

    RiskAdjustedReturn 16 minutes ago
    @Age Olav Mariussen @RiskAdjustedReturn @Need to Know
    Well, the straightforward way would be to reduce the public sector headcount. If wages are too high, then maybe they need to be adjusted also. Whether the Greek politicians can manage it, I couldn’t say.
    I’ll grant you that a reduced headcount will have certain economists complaining that the plan “isn’t working”, because their GDP metric will go down.
    I don’t disagree that staying with the Drachma would have been preferred, but it seems to me that going back would be awfully disruptive.

    SRQ 2 hours ago
    Think of the moral hazard that this would allow. Munchau’s advice is tantamount to splitting the currency union in two: a hard currency northern zone and, led by France, a southern soft currency one. Two huge moral hazards: Portugal, etc would go the way of Greece and northern countries will never pay a dime anymore to the southern ones.

    Swamp Yankee 2 hours ago
    @SRQ
    and northern countries will never pay a dime anymore to the southern ones.
    You say that like it’s a bad thing.

    Austerian Republic 2 hours ago
    Today’s inevitably going to be a tough break for Greece.
    http://www.theguardian.com/business/live/2015/feb/16/greek-bailout-eurozone-ministers-hold-crunch-talks-live-updates

    Night Watchman 2 hours ago
    @Austerian Republic
    You trust The Guardian ?
    Be careful their guys usually know the difference between a “Bridge Loan” and a “Bridging Agreement / Arrangement / Faciliy” !

    Austerian Republic 2 hours ago
    @Night Watchman @Austerian Republic
    Just like Wolfgang in this very article! You seem to be the only person incapable of understanding that a ‘bridging agreement’ = other people’s money.

    Night Watchman 1 hour ago
    @Austerian Republic @Night Watchman
    Wrong ! We suppose that you’re coming in on another pseudo, to be able to “double your trash”.
    Why do you keep showing, in your smart-Alec short-cuts, that you do not know the difference between a “Bridging Agreement” and a “Bridge Loan” .
    What did they teach you (and where ?) in this connection ?

    Austerian Republic 1 hour ago
    @Night Watchman @Austerian Republic
    Whose money is the ‘bridging agreement’? Is it Greece’s or someone else’s? Greece has no money, hence it’s begging everyone it can for more and more money just to keep the lights on. Shameful.

    Openblue 2 hours ago
    Wouldn’t this lead to an almighty withdrawal of euros from ATMs as Greeks fear this new currency is used to re-denominate their savings?

    Need to Know 2 hours ago
    @FT thank you for taking this off the front page. In the end, repetition sqare and uncensored personal attacks against the author. Not worthy.

    empedocles 2 hours ago
    What an incredibly irresponsible article! As I Greek I cannot tolerate the drachma and dignity dogma and have even less time for its foreign proponents. Enough!

    Need to Know 2 hours ago
    @empedocles
    Agree, but for different reasons.

    Night Watchman 1 hour ago
    @empedocles
    Irresponsible ? Certainly not.
    Thought-provoking ; certainly.
    That, of course, is where it hurts the superficiality, and mono-think merchants, prone to immediate knee-jerk reactions ! That hits them in the chin !

    de facto 2 hours ago
    You cannot allow countries within a particular currency zone to print their own (semi-) currencies. It would completely undermine trust in the monetary system and eventually kill the euro.
    I believe the new government in Greece is directly planing to leave the EZ. The idea is simply to demand so much that other European nations possibly cannot accept it and hence Tsipras & Co. can tell their electorate that we were thrown out.

    Wolfgang Munchau FT guest writer2 hours ago
    @de facto In principle, I would agree. It undermines the monetary union. The parallel currency would not be called thus – it would have some of its functions though. I don’t think it would be illegal as such. And you could argue that it would constitute a form of Grexit.

    Need to Know 2 hours ago
    @Wolfgang Munchau @de facto Please read the commentary below regarding California IOU’s

    Abacab 2 hours ago
    @Wolfgang Munchau
    The Treaty of Maastricht is clear that any such paper would not be legal tender.

    Swamp Yankee 2 hours ago
    @Abacab @Wolfgang Munchau
    Yes.
    And even if there were no EU consequence if Greece started accepting the IOUs to extinguish tax debt, they couldn’t use the IOUs to pay off their own Euro debt – the loop wouldn’t close.

    nino 2 hours ago
    It is a good idea, but who would subscribe the IOUs?

    Wolfgang Munchau FT guest writer2 hours ago
    @nino It is not a matter of subscribing. The government would use it to pay salaries or settle bills. The IOUs would then be accepted by others, shops etc.

    Need to Know 2 hours ago
    @Wolfgang Munchau @nino It appears that nobody accepted the CA IOUs.

    Markdoc 2 hours ago
    @Wolfgang Munchau @nino This type of “government scrip” has been tried before, though and has pretty much always failed. “Shops, etc” would only accept such debt at face value if it was mandatory to do so – after all, would you rather sell your product for scrip, which you can only use within a limited system, or would you rather have cash, which is readily transferable?
    Any economist (or historian, for that matter) can tell you where that ends: the scrip ends up trading at a discount to its face value. This simply punishes the recipients by further eroding the value of government payments, and often entrenches corruption in government whereby privileged (ie: connected) actors are paid in currency, while the less fortunate are paid in scrip. It also introduces moral hazard. Since the scrip is inevitably not backed by real assets, the temptation to both issue it irresponsibly to cover funding gaps has historically proved irresistible.

    Abacab 2 hours ago
    @Wolfgang Munchau
    California IOUs were not accepted by anyone other than banks – i.e. people deposited their IOUs at ATM machines in the same way as they deposited checks. Dollars were credited to their accounts. The banks eventually put an end to this.

    Swamp Yankee 2 hours ago
    @Abacab @Wolfgang Munchau IIRC – and I lived in cali during one of these episodes – the state passed a budget and made good on the IOUs before the banks forced the issue. OTOH it was a long time ago.

    Nouser 2 hours ago
    greece is economically insignificant in the Eurozone: so kick france kick italy and leave the greeks some room

    luis63 2 hours ago
    The problems of greek economy will only be exacerbated with a far left government. Should Eurozone keep pumping money while Greece increase public sector size (like opening again public tv) in order to subsidize it population?

    Night Watchman 3 hours ago
    Greece needs to leave the EZ ?
    No, Germany, and the Dijsselbloem mono-thinkers need to become realistic, and have the nous to cease their attempts at continuing visibly failed policies, which, for example, even the EC Presidency and IMF recognise as failures.
    On the one hand, we continue to hear that EZ must be preserved and that the objective is to keep Greece in it. On the other, and at the same time, Schauble and the Dijsselbloem crew (or he & most of the Eurogroup) keep ranting about keeping firmly in place the current rules, and failed mechanisms and accords, which would guarantee the pushing of Greece to Grexit.
    Germany, and Dijsselbloem & Co. are either unseeing, obtuse, over-rigid, or hypocritical, or a combination among all these.
    Greece has the nous and the guts to resist Germany & Eurogroup where they do not.

    Austerian Republic 2 hours ago
    @Night Watchman
    I’m glad you can finally admit that Greece needs to leave the EZ!

    Night Watchman 2 hours ago
    @Austerian Republic @Night Watchman
    And one of his fellow-sheep actually comes forward to hit the “recommend button” !
    There will be more of this little “club” doing the same !
    They really would be so much more at home with their tabloids !

    Jim 3 hours ago
    Greece needs to leave the Euro Zone. It will be painful at first, but in the long run they will have control of their economy and can focus on tourism. The Germans should no longer have to throw money into this bottomless pit that is unsustainable.

    Horace 3 hours ago
    When I read many respected columnists and economists I always wondered how they came up with such measures as printing money to avoid dealing with the underlying causes of financial difficulties.
    A few days ago it struck me – for many of these people money is just numbers. Money has no value and it therefore can be used in whichever way needed to achieve what the particular economist or columnist wants to achieve.
    The trouble is that money is more than just numbers – it has a value and when you ignore this fact you will ignore the causes of any financial difficulties and create solutions that will paper over the problems for the problems to recur with a vengeance some time later.
    Angela Merkel understands the value of money and that it should not just be given away.
    I would be extremely surprised if the Greek prime and finance minister understand the value of money.

    Night Watchman 3 hours ago
    @Horace
    YV is an economist. In the eyes of ASI (Adam Smith Institute), he is a competent one.
    They have seen that he understands money and the value of money.
    You may well be extremely surprised.

    joe22 5 hours ago
    Greece/Ireland/Spain/Portugal should never have agreed the terms of their bailouts in the first place. After the crash the Germans threatened these countries with being booted out of the Eurozone(a bluff they should have called) unless they agreed that German senior bondholders were protected from any losses. Of course the governments of the periphery did not put up a fight because the politicians in the periphery were up to their neck in corruption and were happy to exit stage. This was a total travesty. Any normal rules of bankruptcy dictate that investors must accept some losses for their bad investments. German banks engaged in wild reckless speculation in property in the periphery in the boom years. When the bust came the German govt stepped in and bullied the governments of the periphery in to accepting that junior bondholders and taxpayers of those countries should take all the losses. This was a crime. From a moral standpoint those German financial institutions should have been made to take responsibility for their bad decision making. It also set a bad precedent and created serious moral hazards that we are still dealing with today.

    And it is also important to note that the rules are changing soon for future bailouts – senior bondholders will no longer be afforded the protection the Germans and French got – this is a tacit admission by the Germans that what they did was WRONG.

    Swamp Yankee 4 hours ago
    @joe22
    Your remarks betray an apparent innocence about capital structure.
    What part of “senior” do you not understand?

    joe22 4 hours ago
    @Swamp Yankee @joe22 You are the one who is naive. There is nothing in law that stated that senior bondholders would get off scot-free. Of course senior bondholders get preferential treatment, BUT they should not walk away unscathed as most did post-2008. And the terms of the bailouts and how bondholders were affected was all made up on the fly and negotiated behind closed doors You need to read up:

    http://www.imf.org/external/pubs/ft/fandd/2014/03/orourke.htm

    “There are serious legal, political, and ethical questions that must be asked about how the ECB has behaved during this crisis—for example, the 2010 threat that if Dublin did not repay private creditors of private banks, the ECB would effectively blow up the Irish banking system (or, if you prefer, force Ireland out of the euro area).”

    joe22 4 hours ago
    @Swamp Yankee @joe22

    http://www.independent.ie/business/irish/ireland-stupid-to-guarantee-banks-timothy-geithner-30738356.html

    “Ireland, most people view in retrospect, was stupid to guarantee all their banks. They couldn’t afford it,” the former US Treasury Secretary said.

    Public Expenditure and Reform Minister Brendan Howlin said that while the economic crisis here had been sparked by reckless domestic policies, the ECB had restricted Irish efforts to tackle the situation by not allowing senior bondholders at some banks to take losses.

    http://www.bloomberg.com/news/2012-05-09/spain-underplaying-bank-losses-faces-ireland-fate.html

    Spain, like Ireland, can’t simply let its financial firms fail. Ireland tried to stick banks’ creditors with losses and was overruled by the EU, which said defaulting on senior debt would raise the specter of contagion and spook investors away from all European banks. Ireland did force subordinated bondholders to take about 15 billion euros of losses.

    The EU was protecting German and French banks, among the biggest creditors to Irish lenders, said Marshall Auerback, global portfolio strategist for Madison Street Partners LLC, a Denver-based hedge fund.

    “Spain will be the new Ireland,” Auerback said. “Germany is forcing once again the socialization of its banks’ losses in a periphery country and creating sovereign risk, just like it did with Ireland.”

    Future rules for bailouts:

    http://www.economist.com/news/finance-and-economics/21611120-portugal-grapples-failed-bank-sharing-pain?fsrc=scn/tw/te/pe/ed/sharingthepain

    The bail-in-bail-out hybrid Portugal has plumped for complies with current EU rules, but would fall foul of incoming regulations. From 2016, senior creditors and even large depositors would have to chip in, further insulating taxpayers.

  • #194078

    Sancho the Fat
    Participant
    Neophyte

    cont…

    Swamp Yankee 4 hours ago
    @joe22 @Swamp Yankee
    Appeals to “fairness” obfuscate the reality that banks cannot operate with negative equity.
    If a bank becomes insolvent, you bail it out or you “resolve” it. Those are your choices. They are both unattractive, to be sure, which is how it should be: banks should be prudent, along with their regulators and sovereigns.
    Did Ireland make the wrong choice? Maybe but ECB hardly “tied its hands”; it simply did not allow Ireland to make up rules on the fly and expropriate creditors to preserve equity in its banking system. This is what any central bank or regulator worthy of the name would do. So sovereign guarantees it was.

    joe22 4 hours ago
    @Swamp Yankee @joe22 Maybe but ECB hardly “tied its hands”

    I took the effort to give you the information and you didnt bother to read it. The ECB (well known to be dominated by German policymakers) threatened the Irish government with ejection from the Eurozone. As Kevin O’Rourke correctly points out, this was legally and ethically questionable. Why was the ECB interfering with what was essentially a matter between private institutions? In the real world if an institution goes bust there is a very good chance that investors (including senior bonsholders) will lose a lot of money – this is the way capitalism should work. Also, the ECB is supposed to represent the interests of all member states – not just Germany!

    Swamp Yankee 3 hours ago
    @joe22 @Swamp Yankee
    Why was the ECB interfering with what was essentially a matter between private institutions?
    Because that is what central banks do when those private institutions are banks!
    The Euro itself is screwy – this seems to be O’Rourke’s main point – you have a central bank that tries to be a central bank and would do what any central bank would do, and oh my goodness, see how it interferes with sovereign political decisions! As to “legally questionable”, it seems O’Rourke just made that up – he cites nothing. He’s just emoting. Another emo econ prof – so what? He’s supposed to be some authority? His Euro observation is spot on, but any idiot can see that much.
    Portugal – good bank / bad bank. Senior bondholders transferred to good bank. As it should be.
    Repeat after me the central banker’s catechism: Lend freely, to solvent institutions, on good collateral, at a penalty rate – so help me Bagehot!
    Irish banks were not solvent! No emergency funding!
    Look – the Federal Reserve stood ready to force the United States of America out of the godd@mned dollar zone if it did not bail out its banking system! Don’t cry to me about Ireland.

    joe22 3 hours ago
    @Swamp Yankee @joe22 “Portugal – good bank / bad bank. Senior bondholders transferred to good bank. As it should be.”

    So you dont agree with the new rules coming into force next year that would make this arrangement impossible? As of next year senior bondholders will no longer get this kind of protection. I personally think it is ok to give senior bondholders preferential terms but the good banks/bad bank arrangement is a joke. Not only does it create moral hazard….. it also deters future investment from junior bondholders / small investors. Exactly the opposite of what the world needs right now. No, I think they are making the correct decision to change the rules!

    “Look – the Federal Reserve stood ready to force the United States of America out of the godd@mned dollar zone if it did not bail out its banking system! Don’t cry to me about Ireland.”

    One of their first acts was to allow Lehman to go bust! It was only because of the unforeseen systemic risk that stopped them from allowing others to go bust although they did allow many hundreds of smaller financial institutions to go bust. And the question of whether or not to allow Irish banks to go bust is a separate issue. The question I was addressing was how much pain should senior bondholders take. I think more than they did.

    Swamp Yankee 3 hours ago
    @joe22 @Swamp Yankee
    So you dont agree with the new rules coming into force next year that would make this arrangement impossible?
    Remind me not to become a senior bondholder anywhere in the Eurozone.
    One of their first acts was to allow Lehman to go bust!
    Correct – they didn’t feel they had the legal authority to save them. AIG’s shareholders were wiped out by Treasury action. The Federal Government stepped in and guaranteed solvency – on harsh terms for existing shareholders – which allowed the Fed to continue lending.
    If Hank Greenberg had called Bernanke and said hey Ben just keep lending to all our banks even if they’re insolvent, it’ll all blow over, that would not have worked. It was because Bernanke was ready to shut off liquidity to insolvent institutions that the government passed TARP (with substantial expenditure of political capital for both parties).
    Again – I don’t see what your complaint is.
    The question I was addressing was how much pain should senior bondholders take. I think more than they did.
    And again – I ask you – what part of senior do you not understand? If all you can do is refer me to articles citing more people whining and moaning about the unfairness of it all, spare me – you do not understand capital.

    Night Watchman 3 hours ago
    @joe22 @Swamp Yankee
    Swamp Yankee and his ilk do this all the time.
    The facts hurt them. Having to face them, … even more.
    They philosophise, parrot fashion, and with their smart-Alec aphorisms, on the usual conventional stuff. Once one they get into “uncharted territory”, notably of “perceived or factually presented bullying”, they have to run for cover, debate deviation etc.
    That is when real thinking has to come into into play. They do not appear to be adequately equipped.
    Keep it up, joe22.

    Night Watchman 3 hours ago
    @joe22 @Swamp Yankee
    The whole point is that one is in very delicate legal country once one gives perceived excesses of favour to “Preferential Creditors”, as is so often the case, and has, arguably, been the case in the “bail-out “operations.
    Please remind us who was the ECB President at the time.

    West Tipp 3 hours ago
    @joe22 Too right, “the periphery countries were up to their necks in corruption. Those running the show in Ireland, just wanted the money to keep flowing, as they knew all structural reform would be passed off to those less well off and not in the “system”.

    Night Watchman 3 hours ago
    @West Tipp @joe22
    Well, you had been warned about the unpleasant surprises likely to come out in any exploration of, or itinerary along “Blame Game Alley” !

    joe22 3 hours ago
    @West Tipp @joe22 Yes, but while the Irish politicians were spineless and corrupt. the Germans/French politicians were tyrants. Getting the ECB to blackmail the Irish government was reprehensible. What the whole episode highlights is that the EU is dysfunctional and undemocratic.

    Swamp Yankee 3 hours ago
    @joe22 @West Tipp
    Getting the ECB to blackmail the Irish government was reprehensible.
    Officer! Arrest that Central Banker! He’s Central Banking again!!!

    joe22 3 hours ago
    @Swamp Yankee @joe22 @West Tipp Hahahaha – you dont think the ECB has become politicised????! The ECB is unlike any central bank in the world. It has to find a policy to keep 19 countries happy. The idea that it could be politically independent like the B of E or Fed is utterly laughable:
    http://uk.reuters.com/article/2014/10/23/uk-ecb-germany-insight-idUKKCN0IC1U720141023
    “Until now the ECB was confident, despite all the criticism in the German media, that it could count on Schaeuble and Merkel,” said Marcel Fratzscher, the former head of international policy analysis at the ECB and now president of the DIW economic institute in Berlin.
    “But the recent criticism has been a real wake up call. There are questions about whether they have the full support of Berlin. The German criticism is a big concern for the ECB.”
    The ECB, citing its independence, declined specific comment on the state of relations with Berlin.
    “The relationship is totally rotten, it’s beyond repair,” said a second official who knows them both.
    “It has become personal,” a third official from the ECB said. “Whenever Draghi and Weidmann are somewhere at the same event, there are bets about whether their paths are going to cross. Weidmann avoids Draghi like the plague.”

    Swamp Yankee 3 hours ago
    @joe22 @Swamp Yankee @West Tipp If Draghi is roundly hated by everyone in the Eurozone, it’s likely he’s doing something right.

    joe22 2 hours ago
    @Swamp Yankee @joe22 @West Tipp Another soundbite. I doubt Draghi is “hated by everyone in the Eurozone”…… Draghi believes the periphery need much more support(as do the majority of macroeconomists around the world). This is why the Germans do not like him. I would also hazard a guess that if he had been in charge around the time of the Irish bailouts then negotiations over the terms of the bailout would have been very different.

    jbx 5 hours ago
    IOU’s will quickly have unexpected consequences. In Zimbabwe a few years ago, the Government “legitimised” then illegal dealings in foreign currency by allowing people to buy petrol coupons with real US$ which could be exchanged for US$ face value worth of fuel. (No fuel at the filling station was one of the most obvious features of the economic crisis). These quickly replaced the Zimbabwe $ as the real currency of the country for just about everything except tax payments. But by the end of the Zimbabwe $ a fuel coupon was only worth 70 cents in the supermarket, though still worth $1 of fuel in a filling station. I suppose this was because far more fuel coupons were circulating than there was real demand for fuel.
    Something similar will happen with any Greek parallel currency.

    RTpay 5 hours ago
    I would suggest that Greece may be the right test case for what should be an EU-wide policy of reducing cash in the economy – and using the electronically generated subsequent reports to manage an effective tax collection policy.
    Just to highlight one stand-out number; there is a $200 billion annual shortfall -in VAT collection alone- based on fraud and non-payment throughout the EU. By converting the basic system to real time collection, during the course of the payment – this would be lowered dramatically.
    To do that, cut back the available notes to a maximum of 5 euros – and in so doing bringing a lot of ‘doubtful’ money out of the shadows. Of course, this would be a lot better done if the EZ did this together – hopefully in conjunction with the UK and others – but even if just in Greece it can be very effective.
    The connected, rather obvious, tactic for Greece is to tie in property values with income tax returns – and not be shy about seizing large properties owned by people with no matching income.
    In other words, use the 60% public support to correct the rich/ poor division which is a vast amount of the Greek problem while the people want it.
    Too optimistic? Almost certainly, but if we are to get any sense into the EZ tax planning, it would require a country like Greece to show the way.
    So, back to the usual fudge – or maybe the Russian/ Chinese option after default – a lot easier and no more than the EU as a whole deserves.

    Swamp Yankee 4 hours ago
    @RTpay Ah yes. The iPanopticon solution. Fabulous.
    Here’s the thing: any data surveillance regime capable of precluding “corruption” is also capable of instituting a totalitarian statist system which will exist in perpetuity.
    Greed is an irrevocable component of the human condition. So is will to power. I’d rather tolerate some of the former than give the latter free reign.
    And I’m far from alone in that sentiment.

    RTpay 54 minutes ago
    @Swamp Yankee @RTpay Actually the concept of having the VAT extracted during the clearing of an electronic payment does make life simpler – and far less risky of running up debts for small merchants – by making payment automatic (as is the reclaim) – so less ‘big brother’ and more helpful aid.
    However, for the few of you who are scared of being ‘watched’ there is the option of using your five euro notes, if you are not too bothered about those having tracking devices, diseases etc. – or else using barter to keep totally out of scope.
    Oh, and the criminals who have to use cash as the payment method for drugs etc; sorry, I guess we should not watch them either?

    Spaniard 6 hours ago
    Academic fantasies. IOUs were implemented in Argentina before 2001 and the result have been a disaster.

    John Hansen 6 hours ago
    “Failed Policies”? WM are you entirely blinded by ideology or is there a smattering of reason left in your mentality?
    I will not lecture you with numbers about how Greece is (slowly) improving since about ten months, I will leave it to you and whatever intellect and skill you can muster to try and find out yourself, BUT I SURE AS HELL WON”T LET YOU TAKE ME ON A RIDE, not here, not elsewhere, NOW GO AND BORE SOMEBODY ELSE!

    CivilIsCompromise 6 hours ago
    Germany asked for and got the same debt forgiveness and repackaging of remaining debt in 1953 after their World War 2 debt was found to be to burdensome for progress, so why on Earth are the Germans denying the same policy to Greece? Either the Germans are too mighty a powerhouse of European banker elite or the memory of Germans equals or surpasses the American amnesia to history. i doubt that it is the latter. Give Greece what Germany demanded and received in 1953, a debt reduction coupled with a manageable payment structure. To do otherwise is hypocritical of the underlying basis for Germany’s current strength, a restructuring for the betterment of all concerned.

    Bayesian Risk 4 hours ago
    @CivilIsCompromise
    Germany was;
    – fully repentant
    – hunting down, jailing and executing those who bore the most guilt
    – not blaming anyone else
    – not threatening to take down everyone
    – not flirting with the enemy
    – not refusing to breach the promises they had made

    Greece are doing none of the above. Greece hasn’t learnt anything. It will go on behaving the same as before.

    de facto 2 hours ago
    @CivilIsCompromise Comparing Germany in 1953 with today’s Greece is unfair. Back then Germany was in shambles; As late as 1949 the average calorie intake was 1900 per head and the infrastructure was destroyed. In all big cities some 90% of buildings were destroyed during the war. Greece today is suffering from corrupt political elite who has used the state to enrich themselves and created a bloated and inefficient official sector. Add to that the rich who all but escaped taxes.
    After the war Germany introduced in 1948 a one time wealth tax that hit the rich particularly hard. Up to 50% of the value of your wealth had to be paid in up to 120 instalments. This is something Greece could use as well.

    EinarBB 6 hours ago
    ECB – can kick Greece out at any time, by ending Greek access to “E.L.A.”
    Sure “I.O.U.’s” are a fine idea – a stop gap, but I truly doubt Greece would be able to flaunt entirely the deficit rules, and remain within the EZ. As the ECB probably then cuts access to ela – forcing Greece out of the Euro.
    Greece can just as well, issue IOU’s in Drachmas, as a stop gap solution, before Drachma bills are yet available – – the Drachma could become electronic money from day one, the change happening during a weekend banks opening on Monday with domestic loans (all loans have to be moved into Drachmas to keep the banks viable) and deposit accounts having been changed into Drachma. This would have to be all account inside Greece, in Greek banks – which could create some interesting legal issues later on, but those will be inevitable anyhow – legal challenges probably taking many years, at least the Greek gov would in this instance be able to be thankful that Greek justice system is notorious for being slow. Sentences probably only falling years after the questions have become moot.

    NeilW@MMT 3 hours ago
    @EinarBB The ECB cannot. It requires a two third votes on the governing council.
    And if you end ELA all that happens is that Greek Euros start to float against German Euros (you have to got to exchange to pay bills outside Greece in Euros). The Greek Central Bank can always issue its own liabilities to clear the Greek banking system.
    So there is no need to change anything. The simple act of the ECB removing the peg from the Greek central bank to the ECB causes the change in currency automatically.

    Night Watchman 3 hours ago
    @NeilW@MMT @EinarBB
    Thanks;
    EinarBB keeps plugging this line. He seems to have issues with the rules.

    Old School Canuck 6 hours ago
    As always, thoughtful and thought-provoking. Would that the Eurocrats (and the German politicians) were listening.

    StephenKMackSD 6 hours ago
    After the Financial Times’ fiasco’s of last week: the suspension of comments to both the Tony Blair and Martin Wolff’s essays, and no comments section for Niall Ferguson’s article. The F.T. editors have opened the comments section for Mr. Münchau’s essay. He doesn’t quite favor the Neo-Liberal Party Line, except his support for Mr.John Cochrane’s idea of an IOU. The Chicago School has nothing like credibility! See John Cassidy’s interview with Eugene Fama here:

    http://www.newyorker.com/news/john-cassidy/interview-with-eugene-fama

    And After the Blowup here:

    http://www.newyorker.com/magazine/2010/01/11/after-the-blowup

    These two essays/interviews provide evidence of the Chicago School’s perverse resistance to the reality of the abject failure of the Free Market.

    I haven’t read all the comments, but throwing Mr. M. to the Neo-Liberal lions accomplished what? A bit of face saving for the editors? Ms. Tett’s report on Benjamin Friedman’s address on the Germans and debt forgiveness is non-existent in the world of the apologists for Market Discipline.

    http://www.ft.com/intl/cms/s/0/927efd1e-9c32-11e4-b9f8-00144feabdc0.html?siteedition=intl

    StephenKMackSD

    Swamp Yankee 4 hours ago
    @StephenKMackSD You want to abolish markets? μολὼν λαβέ

    RobVancouver 6 hours ago
    The problem is that Munchau forgets that the problems in Greece are very much home grown. That although there is something wrong with the extreme focus on budget cuts, that issue is only a side issue in Greece. Greece’s problems run far and far deeper and require far more rigorous reforms than the Greek governments have even implemented. The fact that the current government has a democratic mandate to stick its head in the sand is fine for Greece, but other governments have the democratic mandate to expect Greece to take its responsibility.
    Changes to the current arrangements are good, especially for Spain, Ireland and Portugal. These countries have implemented reforms, have shown that their political class is able to take responsibility. To ensure growth in the Eurozone, they should get debt relief. However, I do not see Greece ready to be given debt relief yet. It has been given the most out of all the countries and has done the least.

    joe22 5 hours ago
    @RobVancouver “Greece’s problems run far and far deeper and require far more rigorous reforms than the Greek governments have even implemented”

    Yes, but unlike previous governments Syriza actually want to do some serious reforms – specifically in the area of tax collection. They want to clamp down on tax evasion which has blighted Greeces finances for far too long…… Manchau is right – Syriza need to stand their ground……

    Wolfgang Munchau FT guest writer2 hours ago
    @RobVancouver I would not buy the official line that things are going great in Spain. If that were the case, why is Podemos doing so well. Spain has similar unemployment rates than Greece.

    Ludovic, France 7 hours ago
    Very diabolic article. But Greece and its new government need us in order to increase the number of civil servants they’ve lost since the beginning of the crisis. They could not get them paid if they quit eurozone.

    Distant Observer 6 hours ago
    @Ludovic, France
    Well, that’s the key point: it is the very existence of bail-outs (which are specifically illegal under EU law, but that doesn’t bother the EU, of course) that has caused the governments of countries like Greece to be able to afford to have all this obscene fat and waste in their economies – enormous bureaucratic staff levels, vast salaries and pensions, and a failure to introduce proper tax collection, etc.
    Why would the Greeks want to become an efficient, self-supporting country when they’ve been able to just attach themselves to the EU tit? No wonder they don’t want to leave the euro, or the EU.
    And the EU is absolutely answerable for why they did not force the Greek government, when they first started bailing them out, and over all the years since, to get rid of all this fat and waste – and to properly collect taxes? They had every means of forcing them to do whatever they demanded – but they did almost nothing. They are just as culpable as the Greek governments.

    joe22 5 hours ago
    @Ludovic, France It is imperative they increase the number of civil servants so that they can restore confidence and rebuild their decimated public services. If you are worried about Greeces financial housekeeping then Syriza offer hope there too….. they plan to clamp down on tax evasion/avoidance…… and recent HSBC revelations prove that this would be a very worthwhile and lucrative exercise….. of course the mainstream media wouldnt like you to know that….. they want the people of Europe to keep buying the “lazy feckless periphery” fable…….

    enaon 7 hours ago
    “He is a member of the first government in the eurozone with a democratic mandate to stand up to an utterly dysfunctional policy regime that has proved economically illiterate and politically unsustainable. “
    this is not accurate. The previous government was elected on the exact same principle, but changed course not a day after the poll was closed.

    Gordons alive! 7 hours ago
    @enaon
    What? Elected specifically reject the bailout? Erm I think not.

    enaon 5 hours ago
    @Gordons alive! @enaon
    I think know better. Samaras’s campain included slogans like “the medicine is killing us”, “I will not accept a solution that will kill Greece” ect. He refused to sign the memorandum agreement up untill after his election, which he won based on a alternative plan of 18points, which was based on boosting the economy, not austerity. He simply lied, big time. Syriza is our second go

    Need to Know 8 hours ago
    Some sovereign default historical details: credibility is everything isn’t it?
    http://www.ceps.eu/system/files/CN_May10_web.pdf
    http://www.independent.co.uk/life-style/history/winter-1893-greece-is-bankrupt-summer-1896-it-hosts-the-first-modern-olympics-6257912.html
    http://blogs.telegraph.co.uk/news/peteroborne/100081316/some-european-countries-are-in-the-habit-of-going-bankrupt/

    Gordons alive! 7 hours ago
    @Need to Know
    Exactly. A prime target for loan sharks and fraudsters. They target weak and susceptible people, who usually are too proud or too easily corrupted to know what they are doing.
    Yes this is partly Greeces fault, but like any abuse, the abuser not the user must take the blame for what they do.

    Pulcini 8 hours ago
    Congratulations a brilliant article.

    rubicon 9 hours ago
    Thank you Wolfgang for a supreme and courageous assessment recognizing a historic travesty. Ever since continental European values were overpowered by these Anglo-Saxon debt-fueled practices of global neo-liberal rape, plunder and strategic/natural resources extraction of weaker sovereigns, hundreds of millions of people have been suffering without any rational justification but the uncontrolled greed and power of the few. I like your recommendations but I’m not sure whether the Greeks, who brought us democracy, will be able this time to bring us another breakthrough.

    Gordons alive! 9 hours ago
    @rubicon “Anglo-Saxon” ? OI! Dont you blame us. We told you the Euro was a basket case. We told you not to do it too big and too quick.
    But did you listen? Ohhhh no. Of course you didn’t.

    RiskAdjustedReturn 10 hours ago
    “Athens must stand firm against the eurozone’s failed policies”

    Failed policies?
    Greece borrowed money to hire boatloads of surplus government employees, whose wages then got counted as GDP.
    Naturally when you drop the excess employees, the reported GDP will go down.
    That doesn’t mean that borrowing money to hire them was a successful policy, nor that it’s a failure to let them go.

    Gordons alive! 9 hours ago
    @RiskAdjustedReturn
    Dude read up more. Greece was stitched up like a kipper. Yes it had its issues but the EU is one sorry, sorry mess.

    Gordons alive! 9 hours ago
    @RiskAdjustedReturn @Gordons alive!
    It was thinking
    “Hell yeah, let Greece in. Let anyone in! Oh and by the way, tell the Greeks to chat to this woman we know Goldman Sachs who can cook the books like they have for all of us with a tasty little deception. Then, when we’ve extracted as much of ordinary Greeks money out of them, the Euro will be too big to fail and we can force Europes taxpayers to bail out all our little friends. Oh – and all those shipping billionaires in Greece, they can get their money out easily with our new single currency zone”
    THATS what they were thinking.
    http://www.wsj.com/articles/SB10001424052748703791504575079743591308292

    RiskAdjustedReturn 9 hours ago
    @Gordons alive! @RiskAdjustedReturn
    Well, personally I don’t think letting them in or keeping them in was/is the problem.
    I’d say loaning them too much money was the problem.

    Need to Know 9 hours ago
    @RiskAdjustedReturn @Gordons alive!
    Now it is everybody elses fault that Greece was forced to borrow and borrow more.?

    Gordons alive! 9 hours ago
    @Need to Know @RiskAdjustedReturn @Gordons alive!
    Did I say that?
    In a sense though, yes. We all know whats wrong with Greece. We all know it was an indebted basket case before the Euro and after.
    The thing with an indebted, uncompetitive economy is that is needs to keep borrowing more. Give that country low interest rates (because it suited the German economy), and a strong currency which makes it doubly uncompetitve, then guessy whatty – that country is going to have to borrow more, and more and more and more…..
    Also the big Daddy of the Eurozone, Germany, NEEDED BADLY all the weaker southern European economies in the Euro to prevent the new currency from endangering German exports. It worked a treat.
    Not only did Germany then go from big Daddy of Europe, it became the 3rd largest exporter in the world (by value).
    And not only that, but they had all the PIIGS sucking at the German teat – requiring more and more debt serviced by big European banks who KNEW FULL WELL what was going on.
    As I said, Greece was and is a basket case. They are proud people and that was exploited to the full by a massive, corrupt economic empire building project.
    Open your eyes for goodness sake!

    Gordons alive! 9 hours ago
    @Need to Know @RiskAdjustedReturn @Gordons alive!
    Did I say that?
    In a sense though, yes. We all know whats wrong with Greece. We all know it was an indebted basket case before the Euro and after.
    The thing with an indebted, uncompetitive economy is that is needs to keep borrowing more. Give that country low interest rates (because it suited the German economy), and a strong currency which makes it doubly uncompetitve, then guessy whatty – that country is going to have to borrow more, and more and more and more…..
    Also the big Daddy of the Eurozone, Germany, NEEDED BADLY all the weaker southern European economies in the Euro to prevent the new currency from endangering German exports. It worked a treat.
    Not only did Germany then go from big Daddy of Europe, it became the 3rd largest exporter in the world (by value).
    And not only that, but they had all the PIIGS sucking at the German teat – requiring more and more debt serviced by big European banks who KNEW FULL WELL what was going on.
    As I said, Greece was and is a basket case. They are proud people and that was exploited to the full by a massive, corrupt economic empire building project.
    Open your eyes for goodness sake! Look around you, see and read what the hell has and is going on. This is not a country that went off reservation. IT ALREADY WAS OFF RESERVATION, so what the hell were lenders lending to it for??? What the hell was it in the Euro for?? Who benefited??? Who paid???

    Gordons alive! 9 hours ago
    Just read!!!
    http://www.spiegel.de/international/europe/greek-debt-crisis-how-goldman-sachs-helped-greece-to-mask-its-true-debt-a-676634.html

    RiskAdjustedReturn 9 hours ago
    @Gordons alive!
    AKA — How Greece hired consultants to help them lie to the Eurozone.

    Gordons alive! 8 hours ago
    @RiskAdjustedReturn @Gordons alive!
    Dude – every single country in the Euro has lied is ass off using exactly the same “consultants” LOL.
    Those “consultants” were also the lenders LOL.
    Now, you tell me if that doesnt stink?
    What it says to me is the Greek government (NOT people) were in league with an EU elite closely linked to the Bankers and financiers who knew damn well what they were up to. They knew full well Greece could never pay them back, but they also knew the EU taxpayer would bail them all out. And thats precisely whats happened.

    Need to Know 9 hours ago
    @Gordons alive! @Need to Know @RiskAdjustedReturn
    The best the new government can do is to show some real ball. and implement those reforms which the old government swept under the rug (e.g. tax disk getting lost / erasing some finance minister family member names?).

    RiskAdjustedReturn 8 hours ago
    @Need to Know @RiskAdjustedReturn @Gordons alive!
    Well, you can call it too much lending or too much borrowing, whichever you prefer.
    But either way it’s not EZ membership.

    Gordons alive! 8 hours ago
    @RiskAdjustedReturn @Gordons alive!
    Are you a loan shark? Do you think feeding a debt addict more debt is the addicts fault?
    Personally I think leading a country more debt than you know it can handle knowing full well taxpayers will bail you out is sick.

    RiskAdjustedReturn 8 hours ago
    @Gordons alive! @RiskAdjustedReturn
    Responsible nations aren’t “addicts”.

    Gordons alive! 8 hours ago
    @RiskAdjustedReturn @Gordons alive!
    Errrm. Riiiiight.
    So would you call Greece a responsible nation? NO
    Did lenders know full well Greece could never pay them back? YES
    Did they continue lending Greece far more than it could handle? YES
    Did they know full well that Greece couldn’t handle so much debt? YES
    If you were in the UK you’d have your license withdrawn, probably fined and maybe even locked up if you colluded with 3rd parties and the borrower themselves knowing full well the borrower had defrauded their credit situation.

    Gordons alive! 8 hours ago
    @RiskAdjustedReturn
    Oh – should I also add the little kicker – that taxpayers then bailed you out!! Only about 11% of the bailout money has gone to the Greek treasury.
    Your sorry little tirades against the Greek people, whilst certainly reflect issues that need addressing, are the product of a weak mind only able to grasp whatever is put in front of it.
    They need people like you to continue their work.
    Wake up man.

    RiskAdjustedReturn 8 hours ago
    @Gordons alive! @RiskAdjustedReturn
    “Only about 11% of the bailout money has gone to the Greek treasury.”
    Hardly the point. The original loans, which won’t be repaid, went to the Greek treasury.

    Gordons alive! 8 hours ago
    @RiskAdjustedReturn @Gordons alive!
    You think? You think $100’s billions went to the Greek people? Think again.
    OK I’m clearly talking to an illiterate. Go pick up Economics 101. And put the Daily Mail down.

    RiskAdjustedReturn 8 hours ago
    @Gordons alive! @RiskAdjustedReturn
    I said to the treasury.

    Gordons alive! 8 hours ago
    @RiskAdjustedReturn @Gordons alive!
    Yup. And straight back out again to pay existing debt back to the same frikken people.
    Get it now?

    RiskAdjustedReturn 8 hours ago
    @Gordons alive! @RiskAdjustedReturn
    No, spent and gone.
    The bailout was just an transfer of the debt.

    joe22 5 hours ago
    @RiskAdjustedReturn @Gordons alive! What’s amazing is nobody seems to be aware of the biggest travesty – the policy that protects senior bondholders in the event of collapse of financial institutions. In other words, when the peripherys banks collapsed senior bondholders(which were generally German/French banks/insurance cos) were protected from any losses. This is a complete ABSURDITY and injustice. All bondholders should be treated equally and share the pain that results from a bad investment – if this had happened the periphery wouldnt be anywhere nearly in as much trouble now. Instead the Germans insisted senior bondholders were protected meaning they didnt have to cough up money – and inevitably the end result was bailouts funded by taxpayers in periphery countries……..

    apparently the rules change this year and senior bondholders will no longer be given this protection. Comments anybody????

    michaelgm. 4 hours ago
    @Gordons alive! @RiskAdjustedReturn
    Yes, they went to the Greek people – through the Greek treasury. That’s where the loans were going. To the Greek treasure.The average salary in Greece before the Euro was 500 dollars a month. After Euro and after the Olympics – was 2,500 dollars a month. With no economy basically…

    Need to Know 8 hours ago
    @Gordons alive! @RiskAdjustedReturn
    Dude, its kinda late and becomes pointless.

    RiskAdjustedReturn 2 hours ago
    @Gordons alive! @RiskAdjustedReturn
    “So would you call Greece a responsible nation? NO”
    That’s the point.

    Morlock Sphinx 10 hours ago
    Anyone who says that “”Political extremists may be the eurozone’s saviours”” is an idiot and extremist him/herself!
    Really Mr Wolfgang?
    Mary Lepen a savior?
    Golden Dawn the NeoNazi party a savior for us all?
    Other extremists even racists in Europe?
    Shame on you.
    And you are being considered as a technocrat.
    !

    Gordons alive! 9 hours ago
    @Morlock Sphinx
    Hold on!! Jeezus stop having a cow.
    I know what he means. Its fear of extremist reactionary forces that might drive the EU to the right kind of reforms. He doesn’t mean right-wing politics will take over. Obviously.

    Gnostic63 11 hours ago
    OECD says the biggest reformer is …guess who…http://coppolacomment.blogspot.com/
    But the reformer has been given he wrong medicine dose? Greece’s predicament looks like that of Germany aftr WWI reparations http://krugman.blogs.nytimes.com/2015/02/15/weimar-and-greece-continued/?module=BlogPost-Title&version=Blog Main&contentCollection=Opinion&action=Click&pgtype=Blogs®ion=Body
    Should we increase the medicine? are you sure? http://krugman.blogs.nytimes.com/2015/02/14/greeces-excess-burden/?module=BlogPost-Title&version=Blog Main&contentCollection=Opinion&action=Click&pgtype=Blogs®ion=Body

    Need to Know 11 hours ago
    Thank you for the obviously very emotional and vivid intellectual exchange tonight.
    Unfortunately the master of the universe is loughing his head off, self-believing his seed of discord has been germing well, while his non-involved party troops are marching on. History-repeat.

    RedOctober 11 hours ago
    another solution is that Greece introduces bitcoin as a parallel currency

    11AD 11 hours ago
    @RedOctober oh such a great idea – on par with WM’s really

    sofok10 11 hours ago
    I live in Greece and i really want to beg you to quit … drinking alcohol…

    Need to Know 11 hours ago
    @sofok10
    Sorry it is not your fault.

  • #194079

    Sancho the Fat
    Participant
    Neophyte

    cont…

    Euroanythinggoes 11 hours ago
    Syriza is a radical but middle-strata movement that is primarily interested in taking power rather than promoting some kind of socialist change. In the process they will probably be declared heroes for supposedly antagonising the EU. The truth is that the acceptance of a lower primary surplus coupled with debt/interes payment extensions was goig to happen in any case (creditors agreed to the latter back in 2012 after the haircut was effected). Primary surpluses averaging at 4.5%gdp over 2016-20 was one of the very many stupidities of the Troica idiots that brought Syriza to power. The conservative party would have asked and gotten these concessions in late 2015 had they managed to stay in power. If Syriza acts cleverly and manages not to lose control of public finances in the next months they will succeed,

    Euroanythinggoes 11 hours ago
    By the way i do make comments on Muncha’s article because itis out of touch with reality as usual

    Night Watchman 11 hours ago
    @Don Quijote
    What was that about personal attacks ?

    Don Quijote 11 hours ago
    An attack? I can’t see one. I only see a biologic reality. Greetings
    FlagShare
    RecommendReply
    Need to Know 11 hours ago
    @Don Quijote
    Not Ok.

    Night Watchman 11 hours ago
    @Don Quijote
    That is because you can’t see.
    What do you actually know about the Greek Debt Issue ? Can you share it with us ?

    Need to Know 10 hours ago
    @Night Watchman @Don Quijote
    @Don No, please don’t.

    Night Watchman 10 hours ago
    @Need to Know @Don Quijote
    Yes, on second thoughts, Need to Know, you’re right !

    Distant Observer 8 hours ago
    @Don Quijote
    If this article had been written by any of the rest of the FT’s writers, any negative comment whatsoever about the author – let alone one so rude as the above very offensive and personal one – would have been deleted almost instantly (as it certainly should have been in this case).
    Perhaps no coincidence there, since Mr. Munchau is not a craven propagandist for the EU, and is not at all ‘on message’ in this article.

    Need to Know 8 hours ago
    @Distant Observer @Don Quijote
    I guess nobody flagged it until now.
    FlagShare
    1RecommendReply
    Night Watchman 2 hours ago
    @Need to Know @Distant Observer @Don Quijote
    What ? Read above ! 9 hours ago !

    Night Watchman 2 hours ago
    @Distant Observer @Don Quijote
    I agree! And NO sour grapes.
    The FT’s ideas of what is “personal attack” seems to depend upon the person who is on watch. My lawyer friends know what is a personal attack. They joke about the visible ignorance of the “censors” (NOT targeting the FT, in particular ; certainly not ; but indicating that, on this front, FT can be seen, now and again as exposing themselves to allegations of practising “double-standards”).
    One lawyer told me that one is entitled to wonder if these tabloid-level cliques that are perceived as “ganging-up to gee-up” — and this is not targeting specifically or limited to FT , certainly not — are not just a bunch of overgrown (?) adolescents with a smart-Alec friend, who favours his buddies just to spice things up a little. It is a risk when one opens the flood-gates to comments.
    Perhaps, in their pursuit of “best practice” etc, FT should commission a discreet “audit”.
    Certainly, it is more than arguable that Don Quijote’s insulting drivel should be removed. But that is NOT our decision !
    No journalist (in-house or guest writer) should be targeted by such disgraceful vileness, and certainly NOT Wolfgang Munchau.
    It is for FT to assume their responsibilities in the way that FT see fit. But, there is already an impression “abroad” (“out there”).

    David Best 11 hours ago
    If Greek ATMs runs out of cash, Grexit will become a fact, and that is precisely how things will unfold.
    FlagShare
    5RecommendReply
    David Best 11 hours ago
    Nope, Grexit is the only option left for Greece. The party on the Acropolis is definitely over.

    Night Watchman 2 hours ago
    @David Best
    Oh, really !
    And so the oracle spake ?

    el supremo 12 hours ago
    of course greece has been an economic failure for all the last 100 years. and the reason to join the euro was an irresponsible move justified by disaster and accepted by the euro buro that don t have any experience and wisdom whatsoever .

    Gnostic63 11 hours ago
    @el supremo things are so much clearer after your sophistiated posting

    Night Watchman 11 hours ago
    @Gnostic63 @el supremo
    He forgets to re-read what he has written !

    Musso 12 hours ago
    Semi-exit is Grexit … as the Treaty prohibits printing money other than the €: if Greece issues IOUs, it breaches the Treaty. And, of course, nobody can unilaterally breach part of a Treaty, without having the remaining counterparts declaring the whole of it to have become void. Thus with IOUs, Greece loses its vote within ECB etc etc, while it can of course keep using the € as a parallel currency. In other words, Greece becomes eurorized, but with al public purchases and wages paid in tovarish’s very inflated, but also very revolutionary indeed, assignat.

    Distant Observer 12 hours ago
    Argentina enjoyed many years of very high annual growth rates after defaulting. That happened because by defaulting, they were released from a currency arrangement which made absolutely no sense for their economy – which is also true of Greece.
    Their situation is different from that of Greece, certainly, in terms of Greece not possessing anything like Argentina’s high export potential. But to suggest as all the EU-fanatics in the FT commentariat of course do, in conformity with their dogma, that defaulting and leaving the euro – which is one of the major causes of their present plight – is ipso facto not a possible approach is simply not true.

    Austerian Republic 12 hours ago
    @Distant Observer
    Argentina: http://www.reuters.com/article/2014/12/30/us-argentina-debt-analysis-idUSKBN0K81DL20141230

    Austerian Republic 11 hours ago
    @Distant Observer
    If Argentina can’t even shake private investors coming after them for debt from over a decade ago, how is little Greece going to shake EU governments and the IMF coming after them? I mean, let’s get real. Greece is screwed fifty ways from Sunday no matter what it chooses. Generations of Greeks will have to live in abject poverty before this is sorted.

    To paraphrase Oscar Wilde – sooner or later, we shall all have to pay for what we do. Greece will have to pay now (and for the next 50 years).

    Arthur Wellesley 11 hours ago
    A bit drastic. All the Greeks have to do is restructure out all the parasites in their public services and things will come right a and collect a bit more tax. The EU will then find a way to forgive the debt in a few years time.

    RiskAdjustedReturn 9 hours ago
    @Arthur Wellesley
    “All the Greeks have to do is restructure out all the parasites in their public services”
    Hey, those parasite salaries are critical to GDP.

    Gordons alive! 9 hours ago
    @Austerian Republic @Distant Observer
    If Greece defaults it can tell everyone to get stuffed.
    Argentina is hounded only by a small clique of holdouts who get far more press than they warrant. Argentina has a government who’s corruption make Greece look saintly by comparison and they need the distraction of external forces hounding poor little Argentina.

    Dimitri 12 hours ago
    Mr Munchau’s report of John Cochrane’s post (available in http://johnhcochrane.blogspot.co.uk/2015/02/beware-of-greeks-bearing-bonds.html) is partial and misleading. While Cochrane brings up IOUs as a possibility, he writes the following:
    “To be clear, I don’t recommend this path! This is a theoretical-possibility blog post, not an advice-to-Greece blog post. (Advice remains, stop fooling around, massive structural reform tomorrow morning, grow like crazy, pay off debt.) And yes, it would be a horrible fate for government workers and pensioners. However, maybe better than the alternative: “leaving the euro” means having bank accounts (what’s left after the run) transformed to inconvertible drachmas, and being paid in drachmas, with the whole point is to inflate away the value of the same government claims. So promises for euros might be better. Who knows, maybe eventually the Germans and the IMF might pay these off too.”
    As Cochrane points out, Greece’s foremost priority should be to massively reform its economy away from the current statist and corrupt model. Syriza has a highly statist agenda, which if implemented will bring Greece even further away from the standards of developed Western European countries.
    Greece should be encouraged to reform its economy rather than to be used as a guinea pig to prove a point to the EU policy elites.

    David S 12 hours ago
    Irresponsible pathetic shameful piece of journalism. I never thought I ever read such rubbish in my favourite newspaper.

    ser5037724 12 hours ago
    @David S
    Agree. A staggering piece of irresponsibility from the FT.

    Distant Observer 12 hours ago
    @David S
    Yes, people do like to have their chosen newspaper say things to reinforce their own opinions, don’t they.

    All you want is the normal FT EU propaganda diet: the Greeks must surrender, the EU is wonderful, the euro is secure, etc., etc.

    Well I for one like a newspaper with a wide variety of intelligent opinions, instead of reading a propaganda organ for the EU and the neocons: one which champions a currency which – though the FT commentariat desperately refuse to see it – is driving many European countries into the dust does not fall within the category of ‘intelligent opinion’.

    ser5037724 12 hours ago
    @Distant Observer @David S
    “All you want is the normal FT EU propaganda diet”
    Er…so WHY do you read the FT?

    Night Watchman 11 hours ago
    @ser5037724 @Distant Observer @David S
    And you ?

    David S 11 hours ago
    @Distant Observer @David S
    A wide range of views is welcome of course. I think this is about how the article was phrased. It was dogmatic rather than suggestive and it did not take into account realities.
    It made it sound too easy to implement what WM’s view is based on some chats with some professors.
    I think alternative suggestions how to solve this stand off are needed. But they need to take into account both camps views and obligations.
    Suggesting that the Greeks should not budge is advocating them to commit suicide. Greece will stop being a developed economy once it leaves the Euro. it will not even be an emerging economy. It will be Flintstone country.

    Night Watchman 2 hours ago
    @Distant Observer
    We agree on this, Distant Observer.
    Plurality of opinions is important.
    But how we see, now, what the herd are really about. They really become verbally violent, more intolerant than one might even have imagined.
    They are so limited. That is the problem with sheep following sheep.
    And, you see, WM has yet again shown us how swiftly and pertinently he really can “think out of the box”.
    One cannot expect the herd to do that. They are imprisoned in their mono-think sheep box. It actually seems to hurt them to have to exercise the atrophied “muscles of their minds”, or even attempt to do so, “out of the box” !

    michaelgm. 3 hours ago
    @David S
    He’s playing the game he’s been told…
    A truly diabolical article…With hidden agenda..
    .Subtle hints to the Greek government (? to Varoufakis maybe…) to make their position even more untenable…
    But the readers here exposed Munchau for what he is…

    Night Watchman 1 hour ago
    @michaelgm. @David S
    Great attempt at fiction, michaelgm, but poor result.
    Cuts no ice.

    SUPERFRITZ 12 hours ago
    Parallel currency? Well, there will be a parallel market, too. One where you can buy stuff with Euros, and one where you’re lucky to get some homegrown Greek cucumbers against IOUs.
    As for the capacity of Greece of blackmailing the EU… the last to try this was Cameron, and look how that ended.
    This is not about 1.5% or 3% surpluses or [not] getting the money back in 30, 40 or 100 years. This is about taking a decision on whether the joint rules of the Euro are (finally) enforced or not.
    And there is no understanding of the political dynamics and consequences whatsoever. Caving in to the Greek nationalistic populists will mean caving in to all populists in the future. It also has the capacity to put AfD above 10% in the next German elections.
    This piece is worthy of a Greek tabloid, or worse, the Spiegel, but not of the FT.

    Gnostic63 11 hours ago
    @SUPERFRITZ AfD goes up because it is the logical extension of the CDU policies and messages; if the message is lop-sided (Germany has to pay the bills of the lazies with little in return) then why not vote for AfD? very tempting for the all those Swabian housewives

    ser5037724 12 hours ago
    All the armchair experts and Europhobes telling the Greeks to be heroes need to get a reality check. The Eurozone policy makers have the Greeks in a box and there are only two ways out. Essentially adhere to the existing arrangements maybe with minor changes in the payment terms or Grexit the consequences of which would be horrific. Borrowing costs stay in the 20’s for a long time; the new Drachma will be 30-50% devalued against the Euro; Greece will be on COD for everything from energy to paper towels or export insurance is going to rocket adding to import costs; most private sector debt is denominated in hard currencies which will have to settled in devalued Drachma; the value of all Greek fixed assets or savings (those that are still in the country) is going to be cut by 30-50%. Need I go on? The zone has spent the last three years constructing a firewall to prevent contagion so the exit of an economy which is about 1.5% of EU GDP and 2.3 % of zone GDP will scarcely make ripple. This is a no brainer. Unfortunately, Tsipras, Varoufakis, and co don’t have any brains or thy would already have instituted emergency measures to start dealing with the crisis (eg. limitations on bank withdrawals, currency controls, close the Athens stock exchange, etc.) but instead they embarked on some silly posturing European tour from which it was obvious they were going to return empty handed.

    LoveofMonnet 12 hours ago
    @ser5037724
    I agree that Greece will have to cave in, but I wonder whether its not a bit premature to say their approach as failed. Whether Syriza is successful will be determined ultimately by the result they manage to achieve in the end with their bluff, blame and bluster strategy. The question is whether other European leaders are prepared to pay a premium for avoiding the unlikely outcome that would be clearly more costly to them than Greece not defaulting/leaving the Eurozone. It might have actually succeeded in making the Germans and others feel sufficiently scared and guilty (as well as very very angry!).

    Night Watchman 11 hours ago
    @ser5037724
    Your remark : “Unfortunately, Tsipras, Varoufakis, and co don’t have any brains or thy would already have instituted emergency measures to start dealing with the crisis (eg. limitations on bank withdrawals, currency controls, close the Athens stock exchange, etc.) but instead they embarked on some silly posturing European tour from which it was obvious they were going to return empty handed. “
    Being wise after the event, and as constructive as usual , ser5037724 ?

    LoveofMonnet 12 hours ago
    If Greece was to become a rogue state within the EU, it will be a major headache, but ultimately other countries can kick another member out if they really wanted – they just need to sign a new Treaty with the same provisions as before (thus avoiding a referendum) but without Greece as a member.
    Secondly, much of Greek debt is secured under English law since 2012 – regardless of whether they go bankrupt they can still be pursued for it.
    Thirdly, the advice of stand-firm is nothing more than a bluff because a Greek exit from the Euro becomes near inevitable – frankly I do no understand how the introduction of a virtual country can avoid this outcome.

    Austerian Republic 12 hours ago
    @LoveofMonnet
    “Secondly, much of Greek debt is secured under English law since 2012 – regardless of whether they go bankrupt they can still be pursued for it.”
    That’s the sticking point that Syriza doesn’t want to tell the Greek people. It’s not the first time a Greek government has purposely misled its people, though.

    Distant Observer 12 hours ago
    @Austerian Republic @LoveofMonnet
    They can be pursued for it, certainly – but that doesn’t mean they have to pay it. Argentina didn’t.

    Austerian Republic 12 hours ago
    @Distant Observer @Austerian Republic @LoveofMonnet
    Didn’t Argentina just lose a suit in NY federal court? And have a state-ownded ship seized off the coast of West Africa by a hedge fund? Yes, yes it did. Isn’t Argentina’s economy a total basketcase 15 years after default? Yes, yes it is.

    Distant Observer 12 hours ago
    @Austerian Republic @Distant Observer @LoveofMonnet
    No, you really should talk about something that you actually understand. Argentina’s economy is not a basket case. I go there about every three months, and do business there – and after many years of consistently high growth that any European country would die to have enjoyed, they are now having a period of low growth. Their big problem is high inflation, but they are still doing well in many respects.

    Austerian Republic 12 hours ago
    @Distant Observer @Austerian Republic @LoveofMonnet
    Argentina is third world. $15,000 GDP per capita? HA!

    Distant Observer 12 hours ago
    @Austerian Republic @Distant Observer @LoveofMonnet
    Incredible. Well that says everything that any objective person needs to know about your comments.

    Austerian Republic 11 hours ago
    @Distant Observer @Austerian Republic @LoveofMonnet
    Perhaps, but is Argentina really what EU countries should be aspiring to? Runaway inflation, capital controls and $15,000 GDP per capita? No thanks.

    Need to Know 11 hours ago
    @Distant Observer @Austerian Republic @LoveofMonnet
    What is wrong with some asset based debt restructuring. They get a break and loose a few islands in the process.

    ser5037724 12 hours ago
    @LoveofMonnet
    Leaving the Zone doesn’t necessarily mean leaving the EU. In fact they almost certainly wouldn’t. Either way it’s a minor headache since Greek GDP is about 1.5 of EU GDP.

    Need to Know 12 hours ago
    I can’t believe WM is actually documenting his irresponsible recommendations to Mr. Varoufakis. This is no high noon western picture. It ain’t about blinking. Why don’t you write how often Greek sovereign debt has defaulted since 1900?
    Give ONE good reason why you would negotiate with crooks? This narcissistic enfant terrible image cultivation of your’s is kind of tiring. Grow up, please.
    Make them sell some of their islands. I bet you that would work fast.
    Greeks have an attitude problem. Does anybody owe Greece anything? Their attitude of entitlement is wrong. It is not about being mean or unfair to them. Visiting the Pelepones last year I met people in the countryside who were seriously fed up with having their state pensions halved to € 2000! – I don’t think too many people in the rest of Europe are fortunate enough to boast this kind of pension. Get some perspective please.
    It is obvious that Greek debt needs to be restructured. Get over with the posturing fast please.

    rubicon 13 hours ago
    It’s never only the debtor ….
    “ Even though the mainstream narrative of the euro crisis has encouraged the myth (one of many) that the financial crisis and the euro crisis are two fundamentally unconnected events (in the simplest possible terms: the first was caused by banks, while the second was caused by governments), they are in fact part of the same systemic (ideological, political and economic) crisis. The latter is in many ways a direct consequence of the former. In a deeper sense, though, they both share the same ideological-historical roots.” …………………
    “ According to Nicholas Dunbar, one of the first journalists to break the story of the ‘Maastricht derivative structures’ in 2003, this was a direct consequence of the unrealistic limits imposed by the Maastricht Treaty: ‘For some time, economists have argued that the combination of strict external targets with considerable local autonomy in sovereign debt management almost inevitably leads high-deficit countries towards derivatives ’, he wrote. (33) The most notable example is Greece. As we saw, the spark that ignited the euro crisis was the announcement by the newly elected Greek government, in autumn 2009, that the country’s budget deficit was almost double the previous government’s estimate (12 per cent instead of 7 per cent). How had the Greek government managed to conceal such a black hole in its accounts? The answer came in early 2010, when it was revealed that Greece had paid Goldman Sachs and other banks hundreds of millions of dollars in fees since 2001 for arranging transactions that hid the government’s actual level of borrowing, allowing the country to artificially comply with the monetary union guidelines. Most notable was a € 2.8 billion ‘cross currency swap’, signed in 2000 and 2001 – the largest sovereign derivative deal ever reported – where billions worth of Greek debts and loans were converted into yen and dollars at a fictitious exchange rate by Goldman Sachs, thus hiding the true extent of the Greek loans. The swap reduced the country’s euro-denominated debt by € 2.37 billion and lowered its debt as a proportion of GDP to 103.7 per cent from 105.3 per cent, according to a statement by Goldman Sachs. (34) As Nicholas Dunbar explains: The effect of this was to create an upfront payment by Goldman to Greece at inception, and an increased stream of interest payments to Greece during the lifetime of the swap. Goldman would recoup these non-standard cashflows at maturity, receiving a large ‘balloon’ cash payment from Greece. (35)
    Dunbar estimates that Greece ended up paying Goldman Sachs ‘a crazy borrowing rate’ of about 16 per cent a year, earning the US investment bank hundreds of millions of dollars. (36) Interestingly , just as it was standard practice for Goldman Sachs, in the lead-up to the US subprime crisis, to bet on the insolvency (through the use of credit default swaps) of those same loans that it was selling on to investors – a move that earned Goldman billions of dollars when the subprime bubble eventually burst – the American investment bank also chose to hedge its exposure to Greece by buying a credit default swap on the Greek deal from the Frankfurt-based Deutsche Pfandbriefbank. While such contracts are a win-win deals for banks like Goldman Sachs, over time they can prove disastrous for the countries involved – and even more so for their citizens. Surprisingly, such deals were perfectly legal under European regulation (until the rules on swaps were eventually tightened in March 2008). (37)”
    Fazi, Thomas (2014-02-05). The Battle for Europe: How an Elite Hijacked a Continent – and How we Can Take it Back (Kindle Locations 1784-1791). Pluto Press. Kindle Edition.

    TechAnalyst 13 hours ago
    @rubicon
    Please stop spamming this comment thread.

    Stephen Swanson 13 hours ago
    In response to expected criticism in a much, much earlier reply I posted a link to this article which should be read whatever your political or economic leanings might be.
    http://www.nytimes.com/roomfordebate/2015/01/27/can-greeces-anti-austerity-government-succeed/greece-needs-broader-structural-reforms-than-syriza-has-proposed

    ser5037724 13 hours ago
    @Stephen Swanson

    Exactly so. This is not about “austerity” it is about forcing structural reforms on the dysfunctional Greek political economy in whose dysfunction all classes are complicit. Tsipras and co are just not equal to the task of what needs to be done.

    Night Watchman 12 hours ago
    @ser5037724
    Churn out something useful, other than your usual diatribe !

    ser5037724 12 hours ago
    @Night Watchman @ser5037724
    By diatribe you mean reality check. Instead of trolling why not answer my arguments?

    Night Watchman 11 hours ago
    @ser5037724 @Night Watchman
    Arguments ?

    Night Watchman 10 hours ago
    @ser5037724 @Night Watchman
    You and your ilk are the trolls, and it shows.
    Some have just decided to treat you to a little of the sort of trash which you dish out.

    TechAnalyst 13 hours ago
    @Stephen Swanson
    I just read this opinion piece and the message is that Greece is a basket case with deep-rooted systemic issues.
    If that is indeed so then Greece should never have been allowed to join the single currency in the first place and so this always going to be a slow-mo car crash.
    But what does that say about the rest of the European Project? A slo-mo train wreck? Or a super long term project (as in several generations) before these issues can be worked out and the economies brought into a similar level of focus?

    Night Watchman 12 hours ago
    @TechAnalyst @Stephen Swanson
    TechAnalyst, how come it has taken you this long to reach this conclusion or concern.
    Former French President, Valéry Giscard d’Estaing, said months ago that to allow Greece to join the then EEC, and then the Euro / EZ, had been a mistake.
    So, what else is new under the sun, ad where does that get you ?

    F Primo 13 hours ago
    Thank you so much, WM, you are at your best when you put on your European hat.

    TechAnalyst 13 hours ago
    An excellent article which expands the thinking while delivering a clear message.
    Good work.

    Sovjohn 13 hours ago
    A common argument I’ve heard and / or read states:
    “But Portugal / Ireland / (…) did successfully implement austerity. Why should Greece be treated differently?”
    As always, the devil is in the details:
    The amount of “corrective measures” applied in Portugal / Ireland / elsewhere was far, far lower than the amount of austerity imposed on Greece.
    Yes, the initial prescribed amount “ought to” be higher since the country faced the biggest problems of all.
    No, this has not proven to work thus far.
    I vividly remember the IMF, hardly a campaigner for socialist measures, dubbing the initially agreed “program” as “very ambitious”, which is a polite way of saying “impossible to achieve under normal circumstances”.
    At this point of time, sustainability is all that matters. Debt sustainability is not a Greek issue, either (you have noticed that virtually no country is making progress towards the Maastricht criteria for debt, right? Spain, which was not under a formal “program” at any point of time, had had its debt massively inflated in the past 5 years. Ditto Italy, which is edging on the 140% mark last time I checked.
    All these numbers would be fine really, even Greece’s 180% in a parallel universe, but the caveat is that in the Eurozone, no country has the capability to issue its own currency and thus apply monetary policy, inflation, et al according to its own needs.
    So, to recap:
    The measures applied to Greece’s case amount to 25-30% drop in GDP; in all the other cases (Portugal and Ireland included) these measures applied to less than 11% of GDP in the worst of cases.
    Greece has been facing deflation for a while now, which merely worsens the numbers month in – month out.
    Although I am the first to admit that the governments present in Greece since 2010 did not pursue reforms as aggressively as they should (that does not mean they performed none at all – the deficit shrunk anyway, even though excessive taxation was the preferred avenue to achieve that)…
    …The EU/ECB/IMF program did fail. The program never projected unemployment of 26%, or a depression of 25%. If it did, the numbers would be wildly different.
    Since the EU/ECB/IMF did “rubberstamp” loan tranches based on “progress” and cooperated with governments for 5 years on a very frequent basis (3-monthly assessments and so on and so forth), the onus of finding a sustainable solution is also on them.
    After all, do keep in mind, the base proposition of the Greek government refers to a primary surplus of 1.0-1.5%. Considering the depression the economy has gone through, they would be excused asking for modest deficits below 3%, but they do not, and it should be pointed out that a vast majority of countries in the Eurozone are actually running deficits and not surpluses (even greater than 3.0%).
    Demanding surpluses of 3.0 or 4.0 or 5.0 for…a decade and more is utter lunacy. Surpluses of this magnitude have only ever been achieved by oil producing countries, at periods of great prosperity, and not:
    * In a depressive environment
    * Under deflation
    * With a 180% debt-to-GDP nominal ratio
    As such, I find Mr. Munchau’s article entirely rational and a good basis for discussion.

    TechAnalyst 13 hours ago
    @Sovjohn
    Sorry, far too long.

    Sovjohn 13 hours ago
    @TechAnalyst You can begin with the last paragraph before the bullet points and only go further up if you feel like it =)

    Kaleem Mirza 13 hours ago
    Easier said than done: scrap the euro and let German deal with the consequences of an overvalued Deutsche mark!!

    ser5037724 13 hours ago
    @Kaleem Mirza
    Do grow up. The Euro is not going to be scrapped because at bottom it’s a great deal for all parties if you more or less play by the rules.

    Night Watchman 13 hours ago
    Wolfgang, just to show you “where I am coming from”, and to save you time. I produce this “vulgarised” comment “verbatim”, from the section under FT Article “Final showdown approaches for EU & Greece”.


    Night Watchman 20 hours ago
    My thanks to Stephen Swanson.
    This extract from Stephen Swanson’s recent comment is relevant, for more reasons than one : “It’s becoming increasingly clear why Greece is seeking a six month briidging agreement to create fiscal space through the end of August and then negotiate a longer lasting agreement following the expiry of the bridging agreement.”.


    Without going into the finer detail, it is important to see that we are talking about a “Bridging Agreement” and NOT a “Bridge Loan” !
    A Bridging Agreement (or Arrangement) is, in general, and in the specifics of Greece’s wishes, NOT a Bridge Loan, or any sort of loan.
    A loan has, notably, a date of set-up, reception — as a fact, the debtor receives the money of the loan in total — and of repayment of the principal, and of interest payable specifications for the duration of the loan, with definition of interest payment conditions (dates, rates & and rests).
    A Bridging Agreement is flexible / can be flexible. It is a facility, which is “activated” and / or “exploited” as and when necessary. E.g., and to keep it simple, no money is “drawn by” or “transferred to” the debtor until the need is determined, and the “drawing requested & enacted”. Usually, no interest begins to run as payable, until the debt has been “born” (i.e. monies have been drawn under the Bridging Agreement) .
    To be able to have the arrangement “set up”, the debtor may have to offer guarantees, or pay a fee for reserving (and having it granted) the Bridging Agreement. Such guarantees or fees may be waived by the “lender” or supplier of the facility. There are many possibilities. With good debt management, the “Bridging Agreement” is usually a more flexible and cheaper way to be obtain funding than by Direct Loan (as outlined above).


    Best regards.

    Austerian Republic 13 hours ago
    @Night Watchman
    No one reads these essays.

    Night Watchman 12 hours ago
    @Austerian Republic @Night Watchman
    Yes they do. And you do, too.
    Your crumby little smart-Alec remarks are worse than useless.

    TechAnalyst 13 hours ago
    @Night Watchman
    It’s harder to write something short.

    Night Watchman 12 hours ago
    @TechAnalyst @Night Watchman
    Try to write something useful. You, know, such as, “It’s the EU, dummy” !

    11AD 11 hours ago
    @Night Watchman Here is the thing: as a EU taxpayer I will not accept to give Greece a new loan and even less a new bridging agreement. You can stop waisting your time.

    Night Watchman 11 hours ago
    @11AD @Night Watchman
    If you are an EU citizen, you may find out to-morrow, or in the coming week, that, directly, or indirectly, you have no choice.

    Austerian Republic 11 hours ago
    @Night Watchman @11AD
    Finally you admit this ‘bridging agreement’ is a loan, i.e. other people’s money. So EU taxpayers have to keep financing Greece or she’ll go completely bust. I knew you’d see the light!

    Night Watchman 10 hours ago
    @Austerian Republic @Night Watchman @11AD
    No ! That is trash argument, already thrown out !
    So FT has not yet noticed that Austerian Republic may be the same “author” as one of the herd that kept spouting this sort of nonsense ?
    Oh, FT ?
    The facts saw to it that you lost the debate, dummy. Or you’re imitating the guy who has already had his nose rubbed in his ignorance ! Masochistic ?
    Best to drop it !

    Need to Know 9 hours ago
    @Night Watchman @11AD
    Since the European Steeel and Coal Union bonds have been issued using sovereign default guarantees.
    Since then the system: poor country benefits from the rating of stronger countries is in place and works nicely.
    The interconnections and dependencies between the union members has since then constantly grown.
    Ok, time to review the effectiveness and efficiency of the existing arrangements.-
    – But who would want to undo today the initially loose fiscal union of defaulting states of the _ _ _ ?
    Who is financing the centrifugal forces: AfD, FN, UKIP, etc.? Who is the master of the universe?

    genauer 13 hours ago
    a little reminder from the past:
    http://www.nytimes.com/1985/03/30/world/common-market-discussing-greek-veto-threat.html

    Austerian Republic 13 hours ago
    @genauer
    Blackmail is the Greek national language.

    Night Watchman 12 hours ago
    @Austerian Republic @genauer
    You might get sued !

    UnionLeague 13 hours ago
    OK, so Greece doesn’t take the deal, they then go bankrupt and start over. That’s fine, however, at that point nobody will lend them money and the government will only be able to spend what they collect in taxes and fees. If they decide on money printing with drachmas they will end up bankrupt a second time and with hyper-inflation. Maybe then the Greek people will adopt a different way of managing their national affairs.

    Night Watchman 13 hours ago
    @UnionLeague
    It is not that cut & dried !

    Night Watchman 13 hours ago
    Wolfgang. You wade in further : ” So what should the Greek government do? They should stick with their position not to accept a continuation of the existing financial support programme. By doing this they would no longer be bound by self-defeating policy targets such as the contractual requirement to run a primary budget surplus of 3 per cent of gross domestic product. For a country with mass unemployment, such a target is insane. It would, of course, be better for this nonsense to stop while Greece remains in the eurozone. But the most important thing is that it has to stop. “
    Yes ! Good question ! Great answer !
    Keep the herd at bay !

    Adam Bartlett 13 hours ago
    Great article. The plain speaking and ringing force of your prose is most cathartic after all the nonsense one hears elsewhere on this topic.
    And thanks for adding your voice to the growing swell of calls for a parallel currency.

    Night Watchman 3 hours ago
    @Adam Bartlett
    You write: “Great article. The plain speaking and ringing force of your prose is most cathartic after all the nonsense one hears elsewhere on this topic.”
    Yes, agreed. Highly refreshing after all the “stuff” churned out by the visibly unthinking, undiscerning, biased knee-jerk artists. Sheep following sheep never gets one to a “good place”.
    However, as for the idea of a “parallel currency”, I have no competence to begin to assess that aspect.
    I shall sit that one out, and watch; There is bound to some good input and feedback. A lot of crap, too.
    Might be entertaining, especially if the crap merchants are up (or down) to their usual standard.

    Distant Observer 13 hours ago
    So refreshing that Mr. Munchau – alone among the FT writers – does not act as the EU bosses’ voice piece, but instead makes suggestions which will not please them at all.
    As someone who has spent the last 20 years licensing my intellectual property to multinationals, I know that you only get what you want out of negotiations by knowing where your leverage is – and by taking a position based on that leverage, and refusing to back down. If you don’t do that, they walk all over you.
    Regardless of whatever the FT commentariat thinks, and regardless of the posturing of Germany and the EU, in my opinion, it is almost inconceivable that they would force Greece out of the euro – which would represent a risk of wholly unknowable dimensions.
    Syriza’s enormous leverage is the horrific prospect for the grey-suited EU ideologues that their dogma that euro membership is ‘irreversible’ would thereby be shattered beyond repair. They will do anything in their power, despite all their BS, to prevent that.
    Because they know that once one country had left the euro, it would just be a matter of time before other countries followed them out – and for that reason, they would do virtually anything to prevent Greece leaving the euro.

    And for that reason, Syriza should force them into that choice: either to agree arrangements to give Greece the possibility of a sustainable future which would incorporate an irreversible end date to any further financial aid to Greece, thereby forcing the Greeks to quickly get their act together, so that they could actually have a good future if they do so – or a forced default out of the euro.

    The problem for Syriza is that most Greeks are so addicted to sucking on the tit of the EU, which has given them a standard of living which is totally artificial, that they want to stay in the euro and the EU, no matter what.
    For as long as the Greeks can get bail-outs and subsidies from the EU, there is no motivation for Greece to become efficient – and there is every motivation to stuff your government offices with everyone’s uncle and auntie, and to pay pensions and salaries would would be totally unthinkable were they not attached to the EU’s tit – and to allow massive corruption and tax evasion to continue.
    And this, of course, will be even more true for Syriza than its predecessors.
    Were it not for Syriza’s Achilles’ heel – that the Greeks desperately want to stay attached to the EU tit, and to stay in the euro – Syriza should stake out its immovable objectives with no surrender, and call Germany’s bluff, giving them no choice but to agree Greek terms – or to kick them out of the euro.

    That’s what I would do, if I were Syriza – and take the risk of possibly being unseated if they were kicked out of the euro. But I’m not sure Syriza’s got the cohones for that. A taste of power and the privileges that accompany it tends to make ruling parties want to hang onto that, and not to risk losing all those goodies.

    Night Watchman 13 hours ago
    @Distant Observer
    Great, Distant Observer ! Keep it up !

    11AD 11 hours ago
    @Distant Observer Who cares if the euro is irreversible.
    I just fail to see any risk for the rest of the EZ in the case of grexit.
    Great post otherwise.

  • #194135

    Sancho the Fat
    Participant
    Neophyte

    cont…

    Night Watchman 11 hours ago
    @11AD @Distant Observer
    11AD, change your reading glasses, or your reading sources, or both.

    Distant Observer 11 hours ago
    @11AD
    Well, the risk is due to the fact – as Syriza correctly stated – that the euro is a house of cards. It exists largely on confidence. And confidence is a very fragile thing indeed, as the history of financial markets bears witness on all too many occasions.

    Night Watchman 11 hours ago
    @Distant Observer @11AD
    That is exactly what has been said.
    But 11AD must not have read that article.

    Night Watchman 13 hours ago
    Hey, Wolfgang ! I’m on your side ? You write : “The dispute is about the packaging. The Greeks want a simple bridging loan combined with an implicit acknowledgment that the previous support programmes have failed. Others disagree. The Germans support austerity on ideological grounds. The Portuguese oppose any deal for Greece as they have taken their austerity medicine and did not stage an insurrection. And the Lithuanians are saying: we are even poorer than you are. Why should we bail you out? And so on. “
    No, no ! Just for semantic & real financial accuracy, please correct one detail ! The Greeks want NO new loans ! They do NOT want a “bridging loan” or a “bridge loan” (those terms are Dijsselbloem’s nonsense ! ).
    The Greeks want a “Bridging Agreement / Arrangement / Facility” , but NO “Bridging loan ” ! NO loan !
    I’m NOT caning you ! Please, just correct !They’re not the same thing ; not at all !
    My thanks in advance !

    Austerian Republic 13 hours ago
    @Night Watchman
    Like clockwork!

    Night Watchman 13 hours ago
    @Austerian Republic @Night Watchman
    First, just like a meticulous guy ! “Clockwork ” is for later.
    But thanks for the thought !

    Night Watchman 2 hours ago
    PS : But I know that you know that ! I’m NOT lecturing you ! No need,, … and I wouldn’t dare !

    Night Watchman 13 hours ago
    Thanks, Wolfgang ! Great opening paragraph !
    — “The Greek finance minister can expect a frosty reception on Monday where he will confront his eurozone colleagues in another ‘high noon’ European showdown . My advice to Yanis Varoufakis would be to ignore the exasperated looks and veiled threats and stand firm. He is a member of the first government in the eurozone with a democratic mandate to stand up to an utterly dysfunctional policy regime that has proved economically illiterate and politically unsustainable. For the eurozone to survive with the current geographic remit, this regime needs to go.”.
    Oh, yes ! YV is not going to be impressed by the motley crowd !
    He knows that there is a big following, which sees and say that : “One of the riskiest options would be a formal exit from the currency union ” !
    He know that “Athens must stand firm against the eurozone’s failed policies” !

    Austerian Republic 13 hours ago
    @Night Watchman
    Oh, yes! Don’t ever let someone treat you like a yellow starburst. You are a pink starburst, dammit!

    Night Watchman 13 hours ago
    @Austerian Republic @Night Watchman
    No ! His shirt is blue !

    11AD 11 hours ago
    @Night Watchman @Austerian Republic but there is no blue starburst

    Night Watchman 1 hour ago
    @11AD @Night Watchman @Austerian Republic
    No-one else to press the “recommend button” for you 11AD ?
    Patience ! Just wait till they crawl out of their Monday morning and come on line !

    tini 13 hours ago
    just stop making fools of yourselves by taking greek governments seriously on whatever they promise. hopefully greece will get the chance to rebuild a viable state after a grexit. within the euro – dont stretch for another greek confidence trick. only grexit is the required game changer for a new start. you cannot reanimate a dead duck laden with dead debt wheight. let all those who stand to book grexit losses howl as they want. their money was lost long ago. all the drama is just about when to book the loss.

    Night Watchman 13 hours ago
    @tini
    Greek Governments ?
    Nonsense ! Only this Greek Government ! Had you not noticed ?

    Abacab 13 hours ago
    A parallel currency is probably illegal under Maastrict. ELA would be withdrawn by the ECB for any Greek-backed bonds and other assets, as Greece would be operating outside the confines of the EZ rules, and all its obligations would be treated as pure junk.
    The Californa IOUs lasted a couple of weeks until banks decided to stop handling them, so that’s not an example of a prior success.
    This half-in-half out “Plan B” is a non-starter. It’d back to a choice of fully-in or fully-out.

    Adrian Tan 13 hours ago
    @Abacab I’m surprised this respected FT columnist even raises it.

    Abacab 9 hours ago
    @Adrian Tan
    Lots of “solutions” float around US academic circles, among academics that don’t understand how the Euro is constructed. Most of these solutions are relevant to an indebted Latin American country that is not part of a currency union with debt owed to private creditors. It’s really the job of the European journalist to push back and question why these solutions would work in the completely different European case. However most couldn’t be bothered, as it seems most of them don’t really understand the Euro architecture either.

    a greek 14 hours ago
    From the beginnng, the Greek problem was unique.
    Other countries had a debt bubble either in the state sector or the banking sector.
    Greece had a debt bubble in the state sector, AND a deeply problematic economy.
    The international crisis of 2008 simply laid this open. The EZ countries shored up the crumbling edifice of Greece because they wanted post haste to patch up their financital systems and avoid a Europe wide crash.
    In the process they tried to strong arm Greece to come to some reckoning with its real underlying problems.
    The bail out was a success. It gave the Euro-System 5 years breathing space to in some degree sort their own mess out and ride the worst part of the storm.
    It failed , however, to turn around Greek economy. To their amazement, Greece went into a tail-dive . The common wisdom is that the notorious ‘memorandum’ ( mnimonio) was to blame. In fact Greece was anyway bound for a crash for far more fundamental reasons.The country simply cannot produce anything. The only things keeping Greece out of the perfect third world status is a booming tourism sector and a world class shipping industry. The rest of the economy was shrinking when the crisis hit and continued to shrink and will continue to shrink. The recent clan which took over there recently , with their Leninisti fixations , will make this dive faster and deeper.
    Greece made a fatal mistake to go into the Euro. A traditionally feeble economy could hope for some level of protection by a weak and constantly ‘slipping’ currency. The Euro took this last line of defense brutally away.
    If the EZ really wants to help Greece, they should let Greece get out of the Euro.
    This so called ‘Grexit’ will not even make a ripple in the markets because by now any sane manager must have already factored that possibility into their plans.
    For Greece, ‘Grexit’ is the last hope that the country will not resort to some failed state status. Greece will suffer horrendously for a time, but then it will pick up the pieces and start moving ahead as it always did in the past. The situation is so bad that no painless solution exists.
    Even if the EZ insists on keeping Greece inside the Euro, the only result will be that Greece will be a constant headache for decades to Europe and Greece will be reduced in a wasteland in this process.
    Unless of course the EE is ready to transform itself into a single state overnight and accept, as every state does, that within the borders of the state there are some hopelessly desolate places where ‘social transfers’ will be constantly made . It would be the equivalent of Paris deciding to transfer resources to their slums in the banlieu in order to avoid constant riots.
    It would be quite a tall order if the EE took this huge leap in its existential concept, because Greece has a big problem.

    KissMeHardy 13 hours ago
    @a greek You can’t have your cake and eat it. You say on the one hand Greece is a failed state because it can’t make anything, and then on the other hand suggest it leave the EU. To do what? Carry on making nothing and selling beer and souvlaki to drunken lower class British working class tourists? You partially right in the first instance, Greece has failed to make use of its people and natural resources. I know from personal experience that hundreds of thousands of very bright and well educated Greeks are sat around doing nothing. And Greece could be Europe’s California. What stops them is Greek government and public services which operate like former soviet union apparatchiks – I’ve witnessed it first hand.
    What Greece needs is not the advice of dilettantes, it needs forceful government committed to changes that make Greeks, Greeks businesses, and Greek Government act and think like developed nations. Oddly, if Syriza stop behaving like a student union they might bring have a public mandate to bring about the dramatic changes that are needed.

    Distant Observer 13 hours ago
    @KissMeHardy @a greek
    Yes, ‘student union’ about hits it on the head. It is a testament to how hopeless Greeks have been feeling towards their useless mainstream parties that a party like Syriza (even though I greatly like Varoufakis!), was elected.
    Nevertheless, silly as some of their policies are, they are a most certainly a breath of fresh air in the echo chamber of ideas-free zeroes that staff the EU’s national governments – and the EU gang themselves.

    This is what you get when you have every country in the EU / German empire headed up by obedient nothings in each country – and with the heads of all the other mainstream parties being similarly only distinguished by the one characteristic the EU wants: obedience to Germany and the EU, and no challenges to the EU dogma.

    And the result of this is is what you have in Europe today – a total lack of talent or original thinking anywhere in the upper policy-making levels.

    Need to Know 11 hours ago
    @Distant Observer @KissMeHardy @a greek
    Not sure if Europe (including Greece) lacks talent. I have great hopes for the student union to get the debt restructuring AND the necessary structural reforms implemented.
    What is the (non)sense of using wedge-driving Empire references ?

    ser5037724 14 hours ago
    These mickey mouse remedies (parallel currency?…please) coming from an FT columnist are unbelievable.

    Distant Observer 12 hours ago
    @ser5037724
    Then give reasons for your opinion. There is nothing inherently unfeasible about the idea of a parallel currency.

    Abacab 8 hours ago
    @Distant Observer
    Other than the fact that it is prohibited by Treaty? Any such notes would not be legal tender, could not be repo’d at the ECB or BoG, and could not be offered in payment for debt servicing.

    Chris_in_Oxford 14 hours ago
    I think you have to see everything that has happened with the Euro as the triumph of a certain kind of political idealism (or maybe just over-confidence) that economics can be made subservient to political will.
    The creators of the Euro (politicians not economists or bankers) wanted to believe that, once inside, even a country like Greece could learn to act like Germany or Finland. For a few years it seemed to be working. But the Euro-boat, created on the assumption that it would always sail on calm seas, could not survive its first big storm.

    Night Watchman 11 hours ago
    @Chris_in_Oxford
    A fair “summary analysis”, … at least from your “base-line”.

    Jaga the Wise… 14 hours ago
    Sympathy for Greece? No way! If it were Ireland, Portugal, Spain or even Italy, then I’d probably agree with your reasoning. Austerity during an economic depression is madness, but if we bail out Greece without them agreeing to serious structural and ecomic reforms we’ll just be having this discussion in 10 maybe 15 years down the road again. Greece has defaulted on its debts six times since independence, it was folly to let them into the EZ in the first place. Besides, Greece pays no interest on its debts to its eurozone creditors for the next 10 years and only starts paying off principal in 30 years. Which creditors would ever offer it a deal like that if it left the EZ?

    ser5037724 14 hours ago
    Easy enough for you to say Wolfgang. You’re not going to be hurt with your fat FT salary and expenses so you have no skin in the game. The Troika/Eurozone are not going to give the Greeks a get out of jail free card. Period. Hence the option is Grexit which is going to be a total catastrophe for the Greeks. Indeed I actually believe some in the zone want this to happen to pour le encourager autres!

    Night Watchman 11 hours ago
    @ser5037724
    This is what you call argument ? Can you not raise the level a little ? Just a little ?

    Chris_in_Oxford 14 hours ago
    Democracy is an interesting thing, but then the Greeks invented it, so perhaps they understand. Syriza “won” the election with 36.3% of a turnout of 63.9%. i.e. 23.2% of registered voters voted for them. This doesn’t strike me as a terribly strong position to claim to speak for “the Greek people”.

    Austerian Republic 14 hours ago
    @Chris_in_Oxford
    Or to try to blackmail the rest of the Eurozone.

    Jaga the Wise… 14 hours ago
    @Chris_in_Oxford and at best those voters make up about 1.5 million people maximum. How does that square with the 350 million eurozone citizens who don’t want Greek debt forgiveness. Greek voters have the right to choose: stay in the euro and play by the rules or leave and carry the consequences. No one is stopping them.

    Chris_in_Oxford 14 hours ago
    @Jaga the Wise… @Chris_in_Oxford
    2,246,064 votes for Syriza.

    RR0710 14 hours ago
    This article is terrific. Helps me understand how dumb Germany is. A surplus? Are they serious. Fiscal leaders are clueless.

    faux-reign 14 hours ago
    The Greek parties who are free to voice this today, are the only ones who did not have their fingers in the pie, shall we say. The others cannot say it for obvious reasons.

    NaughtyLuvJungle 14 hours ago
    I very much agree that it is madness to continue the deflationary austerity policies in Greece, as they are counterproductive. At the same time I am very much worried that Greece has not & is not restructuring its economy in such a way that it will ever be able to be competitive with other modern economies. This is the same problem that many other poorly governed countries are struggling with, across the globe. Ending austerity is only half the task at hand, and is necessary but not sufficient for making Greece into a thriving economy in the long run. I fear that ending austerity without more fully tackling the oligarchs and the corrupt power structures in Greece is a step forward, but a step forward onto a path that has no good end. It looks attractive only compared to the present course of continued austerity without enough structural reform (the worst of all possible worlds).

    dsimonc 14 hours ago
    The fact that the only parties in Greece endorsing your argumentation are the communists and the nazis should make you suspicious about it

    faux-reign 15 hours ago
    Greece was the same Greece before it was agreed to join the Euro. They all have their signature under that commitment.
    Germany needs the uncertainty caused by Greece to press on the euro, to boost exports. Greece’s economic structure was always different from Portugal or Ireland, and this was known when accepting them into the ZONE.
    Who actually was receiving those inflated checks from Greece for infrastructure or arms deals. Sure the Greeks took large commissions, but who actually got these checks everybody is talking about?
    Greece has almost no industry to fulfil these commissions, under than labour costs, which is cheaper.
    Somebody should look into arms orders given by Greece, before the bailout loans were agreed. Did Germany and France pick up 9 billions worth of cheques for arms and military contracts for helicopters and submarines from a bankrupt Greece, before agreeing the bailout?
    Grexit will cause the Euro to appreciate considerably, and the cost to Germany will be huge.
    Solely because of its export based, huge economy Germany stands to loose more than Greece from GREXIT. If Germany has decided it can afford GREXIT, it must have found a replacement. The local currencies devalue against the Euro, countries in euro with strong economies can go and buy the whole thing.
    Respects to Mr. Munchau for having the courage to think deeper than the usual copy paste analysts today. Gratitude to FT for having the vision to protect real thought process, however accurate it may turn out to be.
    Shallow jingoism worthy of medieval witch hunting.
    This is about history, not just economy and solvency.

    Night Watchman 36 minutes ago
    @faux-reign
    You write : “Respects to Mr. Munchau for having the courage to think deeper than the usual copy paste analysts today. Gratitude to FT for having the vision to protect real thought process, however accurate it may turn out to be.”
    Many thanks for this.
    You are right. And you can see that many do agree with you !
    Oh, of course, not the superficiality merchants and unthinking, undiscerning knee-jerk artists ! But, who cares ?

    Rodriguez1234 15 hours ago
    Greece should finance this year’s financing needs by issuing T-bills to its banks who then present them as collateral to the bank of Greece under the ELA. The more and the earlier the Greek government does it (e.g. as long as ELA is in place, it can be cancelled every two weeks), the better. Then Greece can default on its european and German bonds with a 66 or 75% haircut, and issue instead new long term bonds to private investors,

    Austerian Republic 15 hours ago
    @Rodriguez1234
    Why would anyone buy those bonds? Greece has already defaulted on private investors during a couple rounds of ‘haircuts’. So you recommend a large scale default on its Eurozone partners, and someone is still supposed to believe Greece is reliable and will pay its debts? Riiiight…

    gkmuc 15 hours ago
    @von Hammersmark @Rodriguez1234 Bond markets are not resentful. Greece successfully issued a EUR3bn bond in 2014 mostly to international investors; spreads had been coming down nicely until the threat of new elections in late 2014. Syriza inflicted an incredible amount of damage on Greece by senselessly pushing for a haircut on official debt whose repayment is not due until 2023. Now they face the real risk of euro exit, something the Greek electorate does not want. The only thing they will get is a further extension of the repayment schedule and a softening of bail-out conditions

    Austerian Republic 15 hours ago
    @gkmuc @von Hammersmark @Rodriguez1234
    They’re not resentful, no, but Greece would be borrowing at sky high interest rates if it were outside the Euro and the ECB and Eurozone weren’t there to pick up the slack as lender of last resort.

    gkmuc 14 hours ago
    @von Hammersmark @gkmuc @Rodriguez1234 agree, euro exit is definitely the worst option for Greece

    Adrian Tan 13 hours ago
    @gkmuc @Austerian Republic @Rodriguez1234 The Greeks voted this lot in.

    Rodriguez1234 14 hours ago
    @von Hammersmark @Rodriguez1234 Yes! If we assume Greece needs a debt to GDP of 50% to sound credible with private investors, then Greece should default on its european bonds (well, excluding the IMF and the ECB, previously refinanced) and calculate the haircut in such a way that it doesnt cost it more than 50% of debt to GDP. It can then refinance that debt easily on private capital markets.

    @daviddenton20 15 hours ago
    Strange that Wolfgang should be standing up of a communist dissident like Varoufakis – but weirdly I agree. Europe has suffered enough from German trade imperialism and it needs to end right here.
    http://getwd50.blogspot.co.uk/2015/02/a-free-lunch-for-europe.html

    11AD 15 hours ago
    @@daviddenton20 Unbelievable : the goal of the euro is simple : to provide low inflation. And it succeeded splendidly at that. It even allowed most EU states to borrow at unrealistically low rates.
    If you don’t like that goal, take a hike.

    Night Watchman 1 hour ago
    @11AD @@daviddenton20
    No. Not THE goal ! There were others.
    Go off and listen to (or read) D. COHN-BENDIT.

    11AD 15 hours ago
    Wolfgang – what utter nonsense.
    I will kick out my president / chancellor if he/she gives Greece a further cent.

    Night Watchman 11 hours ago
    @11AD
    Will you ?

    Frugal 15 hours ago
    And what do you offer to those that took on austerity for real, have well functioning tax collecting systems, lowered salaries and increased tax revenues massively? What is te real reason why Greece is where they are? It is very simple: they have lived for ages above their means and now they need to live within their means, what some call “austerity”.
    You may argue that those who lent money to Greece should also be penalised; ok let Greece default and penalise those lenders but we cannot throw more good money on top of so much money badly use

    11AD 15 hours ago
    @Frugal Precisely

    Austerian Republic 15 hours ago
    @Frugal
    Exactly. The world is supposed to bend over backward for Greece. Why, exactly? Will we be demanding the same concessions for Ireland, Portugal, Spain and Italy, retroactively? Why is Greece different? Oh, that’s right, because successive Greek governments have refused to actually implement the reforms necessary to create a modern, efficient economy. What a joke.

    Austerian Republic 15 hours ago
    “The dispute is about the packaging. The Greeks want a simple bridging loan combined with an implicit acknowledgment that the previous support programmes have failed.”

    The Night Watchman will be here any time now to inform us how misinformed the author of this piece is, because Greece wants a ‘bridging agreement’ not a ‘bridging loan’. Begin the countdown…

    Night Watchman 12 hours ago
    @Austerian Republic
    How observant of you.
    But , are you another of those that does not know the difference ? There are quite a few kicking around !
    However, I am prepared to think that, in the case of WM, it was “slip of the keyboard” !

    Andre 15 hours ago
    The Greeks have proven that they cannot manage money well and that they not trustworthy borrowers. Why does Europe need them? Kick them out. Can anyone please explain?

    Night Watchman 12 hours ago
    @Andre
    Wake up and get constructive.
    This sort of not even semi-literate stuff is hopelessly counterproductive.

  • #194136

    Sancho the Fat
    Participant
    Neophyte

    cont…

    CoffeeMug 15 hours ago
    These Eurozone policies worked just fine in Ireland, Portugal and Spain as was seen on Friday in 4Q2014 growth figures. Similar policies worked just fine earlier in Sweden and Finland. Structural reforms worked very well in Germany.
    The policies didn’t work in Greece since the Greeks chose to not implement them fully. They did, however, choose to accept two huge bailouts and a re-organization of their debts. Now they say they’re “insolvent” and need yet further assistance. Eurozone electorates have severe Greece fatigue and want to get on with their lives. Thank goodness there is, I hear, a hard deadline on Monday to decide this one way or another. Since Syriza doesn’t have a mandate to leave the Euro, they’ll probably sign on the dotted line on Monday.

    Austerian Republic 15 hours ago
    @CoffeeMug
    Exactly. Only in Greece have the failed and failed repeatedly. Greece is a cancer in the Eurozone. Cut it out.

    Night Watchman 12 hours ago
    @Austerian Republic @CoffeeMug
    When are you going to produce something interesting and constructive ?

    stonebird 15 hours ago
    @CoffeeMug
    When you look at the unemployment figures in Spain and Portugal – if you believe that those are a “success” then you will believe anything. Or maybe I am wrong and that is the real object of the EU zone policies that you mention?

    CoffeeMug 15 hours ago
    @stonebird @CoffeeMug Unemployment is a lagging indicator and the last to recover from a recession. The Spanish job market has perked up significantly and people are finding jobs at an accelerating rate.

    Night Watchman 12 hours ago
    @stonebird @CoffeeMug
    The problem is that they seem not even to begin to reflect. They just bang the keyboard.

    Lusitan 14 hours ago
    Unfortunately tovaritch Tsipras and associates aren’t very concerned about mandates. After all they got only 36% of the votes. What they might very well want is to create a strong enough impression in Greece that Europe is pushing them out of the Euro. If they succeed that will give them the necessary incentive and excuse to go alone, and create their dream of Marxist Cuba by the Aegean.
    If they are not trying to follow such a plan they certainly look like it,

    Dick 15 hours ago
    I can’t believe my eyes that this sort of Kindergarten talk appears in the FT. This author is inspired by rancour . Failed academic, politician or eurocrat? Certainly a failed journalist. I am a subscriber. Stop wasting my money.

    genauer 14 hours ago
    @Dick
    The author has a long distance Math degree, and is somewhat …. how shall we say it …. not satisfied, that neither
    his suggestions to revolutionize German economic thinking nor
    the attempt to establish a foaming before the mouth German “Financial Times Deutschland”
    ended well, to put it politely. He has many axes with Germany to grind : – )
    But his anti-German tirades sell very well to many people, even in Germany, it is a very successful business model

    Night Watchman 12 hours ago
    @Dick
    Exactly ! It’s not even kindergarten level !

    Euroanythinggoes 15 hours ago
    As i understand it, Greece was the main guineapig of austerity policy manourving and now it has become the guineapig of political manouvring

    Swap 15 hours ago
    By the end of 2013, Greece had the HIGHEST government spending/gdp ratio in the EZ (see, for instance, paper by Syriza´s chief economist). Much HIGHER than before the bailouts.
    And its not interest driving this, as Greeces´s effective interest rate is just 2% (Greece spends 7 bn in interest a year now, it was 12 bn a year before tha bailouts).
    Its the fact that Greece cannot stop and hasnot stopped its irresponsable crazy fiscal policy ways.
    And we should lend another cent to these people?

    Martin Wolf, FT FT15 hours ago
    @Swap According to the OECD, in 2014, the Greek ratio of government spending over GDP was ninth in the eurozone and also below the eurozone average. Moreover, GDP (the denominator) had fallen by 25 per cent in real terms since the crisis, much the deepest recession in the eurozone. The Greek general government deficit also fell from 15.2 per cent of GDP in 2009 to a forecast of just 1 per cent in 2014. This is massive austerity, by any standards.

    Swap 15 hours ago
    @Martin Wolf, FT @Swap
    – Greek gross government spending HIGHER in 2010-14 (bailout, “austere” years) than in 2004-08
    – Greek government spending/gdp HIGHER in 2010-14 (bailout, “austere” years) than in 2004-08
    – Greek gross government employee compensation HIGHER in 2010-14 (bailout “austere” years) than in 2004-08
    – Greek government employee compensation/gdp HIGHER in 2010-14 (bailout “austere” years) than in 2004-08

    Swap 14 hours ago
    @Martin Wolf, FT @Swap If your GDP collapses you should adjust accordingly, otherwise you are living even more above your means.
    The 2014 ratio shows that Greece was making progress, as we all know (access to capital markets, better economy, lower spending). But the average for 2010-14 was higher than the average for 2004-08. If austerity means “the government disappeared, left us on our own, spending banished” well that obviously did not happen whatsoever overall. Overall, the average presence of the state was higher in 2010-14 than in 2004-08.
    2009 is a big outlier because what happened is that Greece just went out of control in 2009. Spending went to 128 bn (absolute historical peak, 100% more than in 2000), while revenues were collapsing to 91 bn. We shouldn´t use 2009 as the yardstick because 2009 was the height of all fiscal madness. If not deviating much from 2009 is the goal then obviously the goal is fiscal insanity.

    Swap 14 hours ago
    @Martin Wolf, FT @Swap Also, if your economy tanks 25% simply because of a TINY (if at all) change in government spending habits, then obviously the economy was a basket case to begin and requires drastic and instant reform.
    If there is nothing else besides massive government spending funded by massive debt, then that´s the problem at core.
    There is something called private sector, the Greeks ought to try it. Oh wait, that may require hard work, talent, risk-taking, creativity, competition, ambition, drive.

    genauer 14 hours ago
    @Martin Wolf, FT @Swap
    The Greek Government spending may have been lower than in e.g. Denmark, but that is the wrong comparison, if you don’t have the same tax collection.
    That the Greek GDP was prior to the crisis totally inflated by a current account deficit of 15% (IMF data for 2007 and 2008), leading to positive output gap (overpay) of 10% !! does not make those excessive levels a relevant yardstick either.
    The only thing relevant for something totally out of control and normal data relation is the GDP now

    Skipper 13 hours ago
    @Martin Wolf, FT @Swap Swap is right. It’s the actual absolute figures that matter.

    stonebird 16 hours ago
    That financial commentators are at last noticing that the present situation is untenable, is already a sort of “victory” for Greece.
    Mr. Munchau’s article is a welcome change in attitude – but I still distrust one of the solutions – electronic money. Which puts power straight back in the hands of Banks – that are themselves most of the problem. (Even if it is “the Greek Government” which prints the money – my distrust is that the Banks would then find someway to take “control” of the printing themselves)

    rubicon 16 hours ago
    On Tienanmen Square the tanks maneuvered around the man. Greece may not be that lucky.

    Swap 16 hours ago
    @rubicon Hand to hand street combat is likely coming to Greece. The communists versus the useful idiots. Guess who´ll win? Ask Lenin and Che you don´t believe me.

    Swap 16 hours ago
    Anyone commenting on this topic should disclose their financial portfolio,
    For instance, I can see how many super longs would be very interested in a deal that guarantees “stability” within the EZ. It´s not their money so sure let´s try to convince the EZ fools to throw yet more free loans at Greece so that an EZ “crisis” is averted and stockmarkets can go up and yields down.
    So, long or short. Mr Commentator?

    Youre O Crat 16 hours ago
    Me, I only have my car loan, no holdings, no shorts, no longs.

    NM1 16 hours ago
    Leaving the EZ would be a major disaster for Greece, orders of magnitude greater than what can happen if the country stays in the EZ.
    Mr. Munchau and other commentators, easy for you to pontificate about options for a whole country that is ready to go back to the stone age if it leaves the EZ, when you live comfortably in London or somewhere else in rich northern Europe, with your money secure in banking systems that your governments have protected at all costs. You are now advocating a poker game with the livelihoods of millions of people – perhaps because you’d love to see the EZ broken up and you cherish this moment? The new Greek government has NOT been given a mandate to leave the Euro, it has actually repeatedly said this will not happen and this was the key for people to vote for it.

    Ca 16 hours ago
    @NM1 And your solution is? It has to make Greece grow to get its debt down from 175% of GDP. How does this happen when it has a fixed exchange rate with Germany which is strangling it?

    NM1 16 hours ago
    @Ca @NM1 Bite the bullet and work harder. Get the retirees back into jobs (see the numbers given by Athenian below). Instead of asking Germany for loans so as to pay retirees, Greece should ask for Germany to put factories there. Privatise everything that moves – and stop demonising the greek capital and “oligarchs”, they are as good or bad and as many as anywhere else. Do what Portugal or Ireland did. Even being the poor cousin of Europe, is better than being outside. Before SYRIZA, Greece was getting into shape.
    And, most of all, for Greeks the EU and the EZ provides protection from Turkey.

    maljoffre 16 hours ago
    The leopard may never change its spots but Wolfgang Munchau has begun to realise that the austerity forced on Greece by a punishing agreement which only enriched the lenders and crippled the Greek economy is a very close second alteration. Of course, major economists across the world, including many Nobel Prize laureates, have been saying this for quite a few months now, so it’s hardly news. Mr Munchau still tries to drag the rancid dead horse of Grexit into the argument down through the basement stairs, however.

    Swap 16 hours ago
    @maljoffre The unbearable austerity of increasing government spending and government employee compensation and no privatizations and 200 bn in free loans and the lowest effective interest rate in the EZ.

    Paul Munton’s Potimarron 15 hours ago
    @maljoffre
    “the rancid dead horse of Grexit” Is that a subtle allusion to the Elgin Marbles perhaps?

    Austerian Republic 15 hours ago
    @maljoffre
    No one forced austerity on Greece. Greece ran out of money. Then it ran out of other people’s money. It is begging, yet again, for more of other people’s money. Austerity is a natural consequence of running out of money (both your own and other people’s). Greece chose this route with its failed fiscal and economic policies.

    Swap 15 hours ago
    @Fritsen @maljoffre Revenue went down from 98 bn in 2008 to 91 bn in 2009. How did Greece respond? Naturally, by increasing spending: from 122 top 128!
    Plus, capital markets closed because the country was bankrupt (and had been lying about it!).
    Greece could not afford that 128 bn in spendign without someone else lending them a lot of money to finance the gap (128-91). Greece could not on its own afford so much spending.
    What they call “austerity” is simply living not even within you means but at least within some not totally insane artificial means. If Greece had been allowed to truly live within its means (say, 80-90 bn annual spending, not the 100+ bn average in 2010-14) now that would be some real austerity, eh?
    Greece can only repay old debt by borrowing new debt. Unless it decides to produce steady reliable growth. By electing Syriza it has decided not to.

    Night Watchman 11 hours ago
    @Austerian Republic @maljoffre
    So, what do you have by way of constructive proposals for remedial action ?
    The record is stuck.

    Archimedes 16 hours ago
    “The most sensible one is the introduction of a parallel currency — not necessarily paper money, more like a government-issued debt instrument that can be used for certain purposes”
    Would these not trade at a premium? Once the market has recalibrated itself to take account of a different instrument, I don’t see why these wouldn’t be just as expensive for the Greek government as bond issuance.

    AndrewV 16 hours ago
    As well as creating electronic money Greece also has the ability to print Euros. How could Germany stop them switching on the presses at the Bank of Greece if it really came to it.

    Chris_in_Oxford 14 hours ago
    @AndrewV It’s not the government of Germany’s job to stop this. But it is the job of the ECB.

    Vgeor 16 hours ago
    A nice example of politically irresponsible advice. Someone should explain SYRIZA voters that what it is proposed here will lead in the best case to a growth model where they will have to compete with Bulgarians and Chinese workers for low paid semi-skilled jobs. This means that their standards of living, having declined by 25% percent during the last 5 years, will have to fall in a day for at least another 50%. Most Greeks who voted for SYRIZA did so because they were promised a return to 2008 living standards. And 2/3 of all Greeks still respond in opinion polls that Greece “should remain in the Eurozone at any cost”. All the above mean that a eurozone exit will not be politically manageable by any political force within Greece. Also the article is a nice example of free-riding mentality. It is nice if Greeks take the risks of pressing for a change of EU policies. If they succeed, all of us will share the benefits. If they fail, which they most likely will, they will suffer all the pain. Of course in that case we will express our respect for their nicely-fought battle, and the high ideals that motivated it. We will also vote for a petition against the predatory countries and financial institutions that condemn countries to poverty and deprivation. And then we will go on living our lives, forgetting everything about this sad story.

    Speculator 16 hours ago
    Internal to Greece who are the Elite that benefit from this system as do not buy story that such a deal with bottom of pyramid would have held for so long unless the top of pyramid are getting even more out of the system. Seem to recall that this was the case in first articles after election around how these fellows control the media, banks and so forth and that Syriza while promising to deal with them will not have the back bone and clout to do so….

    Daniel 21 16 hours ago
    “The argument is not really (sic) about the money.” And “Once this system is in place, you can default on official European creditors. What can they do?” I’m not often left with jaw-drop by an FT piece, but Munchau got me with this one, which could have been written by one of he head-banging borrowers waiting to have their mortgages written off along with their credt card debt.
    Regarding Grexit, I agree with Harry Haller in the comments below. It’s time for Greece to go. Whatever deal is cut, Greece will be in the same situation again in another year. Syriza has NO development plans; indeed, it blends its statist outlook with a generous helping of anti-modernist romaticism. Both Varoufakis and Tsipras have recently noted in public that they get all teary-eyed by the “frugal life”, a favorite lifestyle-cum-moral stance by Greeks who have lots of property and money. The Greek elite is parasitical and completely ignorant of that fact, which explains all the swag. Banners in Syntagma Square in support of the government’s “negotiations” express the swag outlook best: “No property confiscations. I don’t owe. I won’t pay.” Cool. Or as Varoufakis migh say, wow.

    athenian 16 hours ago
    We agrre, EU financial and fiscal policies are not perfect. BUT they worked good in Portugal. Ireland and they totally failed in Greece. But thiis fail is not omly for EU polixies but for internal serious strucrural problems in Greek economy. Some examples. Greece has a population of 11M, public serbants 0.8M and keep calm 2.7M retirees and seat down 4,6M pension bills. That means that 1.5 retirees get rwo or more pensions. And thiw is not the end in this insanity, !M of the retirees are in age lower than 65 year old.
    Trully, I do not know any EU fiscal policies which can keep alive this sickness
    The total amount of tax collected ny Greek government is 55B euros, and the total amount of money for pensions is 27B (15B euros is the sunsidy for pensions). The payments for piblic servants are about 20B euros and only 7B euros for government investments.
    Five yeas trioika try to rationalize this insane budget, but the Greek populism is invincible and your article is a clear proof. It is so simple, we put the blames on Europeans and it works and in the end of the day we take more money and this is the story for tha last 35 years.

    jamie encore 15 hours ago
    @athenian Thank you very much for actually providing Mr. Munchau with some data. The article itself has next to none.

    Vox 16 hours ago
    The core issue is not what Syriza brass does or does not do on Monday.
    The core issue is that the Euro is poisoning the Continent.
    Getting off this fixed exchange rate dope today would have a price, and quite a price it would be. But stubbornly clinging on to this drug all the time hoping for better times will command a much higher price in the near future. Amend-extend-pretend won’t cut it much longer, no matter how much the U.S. backs the Euro Bunch . A chain of “exits” will be disastrous and the final consolidated bill will plunge the Continent into decades of depression and into the arms of neo-fascism. THAT , and not a Euro break up, is the real “end of the world” scenario to be avoided at all costs. In any case it should be now clear to everybody that after 20 years of Euro mismanagement nobody is going to get off the hook scot-free, neither Germany nor anyone else.
    Hopefully illuminated Germans like Münchau will soon come to accept this simple fact of life. Then maybe Europe will let go of the Euro straight jacket by which it will overcome its seemingly endless WWII hangover, i.e. the “German question”, a deeply racist and self defeating mindset based on the assumption that Germans are intrinsically dangerous and need to be “tied up” to more civilized countries like France and its allies. And the Continent will finally be able to carve out a sustainable place for its self in the world economy and in world politics. Europe can only thrive on the diversity of its Nations: it will have to learn to manage that diversity peacefully and productively instead of trying to eradicate it according to diktats of the Euro Bunch.
    Wishful thinking? It may be. But the Euro is so for sure.

    Distant Observer 15 hours ago
    @Vox
    “Europe can only thrive on the diversity of its Nations”: that is so true. And the EU and the euro have both worked to forward the ideologically driven aim of the exact opposite in Europe – the attempt by the EU to homogenize a continent a fast as they can, destroying the very characteristic of Europe which has been its greatest strength for centuries.
    Europe has not had hundreds of years of leadership in the arts and technology by accident: it was the diversity, and competition between the different countries and regions and cities of Europe that led to to those hundreds of years of outstanding success.
    And the dead hand of the EU ideological bureaucrats, want to homogenise and flatten, together with the totally idiotic euro currency which ignores the massive economic and cultural diversity of European countries, and prevents the Price Mechanism from doing its wonderful work whereby countries’ currencies adjust to their relative strengths and weaknesses, and give them a means of recovering against more successful competitors, is what is driving Southern Europe into the dust.

    A.Lex 15 hours ago
    @Distant Observer @Vox
    Hear, Hear.
    We should be talking of Euroexit not Grexit !
    This appalling mess is entirely due to the creation of the Euro and the old mechanisms which have worked for ages would have taken care of excesses and deficits; the EU will suffocate in its selfmposed straitjacket.

    Distant Observer 15 hours ago
    @A.Lex
    You won’t get anywhere writing such things as that with the FT commentariat!
    Those people who actually understand economics, instead of being brainwashed economic illiterates who blindly adore the euro and the EU for purely ideological reasons, have mostly long since stopped paying their subscriptions to the FT – or they use the FT only for business purposes, and ignore its idiotic political dogma.

    Harry Haller 17 hours ago
    Personally I prefer Grexit, firstly because I am fed up with the issue of Greece as the world as much more important and pressing problems to solve, secondly because it would make or break the Euro by putting it through the test of fire. If it makes it then it becomes a true currency, otherwise let’s get over with it.

    Swap 17 hours ago
    This is a heist plain and simple. The biggest con ever.
    A deadbeat rogue nation that lies about its own fiscal situation is given 200 billion euros, interest is reduced to zero right after, maturities are extended from four to thirty years right after, private creditors are massacred and their bonds reduced to nothing. In return, the deadbeat rogue nation implements very little reforms, privatizes nothing, and actually increases government spending and government employee compensation.
    In spite of the all that free money, in spite of having been allowed to re-access capital markets at cheap rates, in spite of all that government interventionism, the deadbeat rogue nation still can´t meet its obligations (even though its effective interest rate is lower than Germany´s and the US´s) and is once more begging for some spare cash (but with no conditions this time!).
    The real scandal is why the 200 billion were lent in the first place. Forget Greece, They want to leave the EZ anyway. Why isn´t there more focus on those who actually wired out taxpayers money to the deadbeat rogue cheating nation???

    The Invisible Hand 17 hours ago
    @Swap You are flogging the wrong horse again. Some EU bankers made some exceptionally stupid loans that could never be repaid. Some euro-commissars decided to help their banker friends maintain their bonuses and lifestyles by underwriting the stupid loans by EU taxpayers, who are understandably annoyed. The euro-commissars are lying to the taxpayers that the debts are sound, and shifting the blame to Greece.
    Some euro-commissars will get plum seats on bank Boards when they retire.
    Taxpayers will forget their 500 euro loss (each) after some whining.
    Mr Varoufakis will write another fascinating learned book.
    There are always winners and losers in game theory…

    Swap 17 hours ago
    @The Invisible Hand @Swap Again, many creditors who were “rescued” in 2010 (not in 2012, in 2012 they were all massacred) were local Greek citizens and firms. In fact, the Greek banking system was saved (imagine how many regular Greek jobs were saved because of this???).
    In any case, if EZ wanted to protect their banks from a Greek default (which, without the bailout, was a certainty) they should have helped their respective banks directly. Either loans or equity investments. It would have worked out much better: the banks would have paid back the money at a profit (TARP in US), and EZ would not have a 200 billion hole with rogue Greece.
    EZ could have acted that way and still help their banks. But they wanted to give Greece a chance, thus the 200 billion. Greece has used that chance to elect an anti-system communistic regime.

    The Invisible Hand 16 hours ago
    @Swap @The Invisible Hand
    At last we may agree on something, I think. The EU countries should have allowed Greece and the careless banks sort out what was a commercial problem of default.
    If the banks required assistance to take the loss, the home country should inject liquidity in exchange for bargain price equity, as happens in the good old USA. The equity can be eventually sold at a profit for the taxpayer.
    In a true capitalist economy shareholders take the hit. What happened in Greece is reverse Marxism: From the poor as much as you can squeeze, To the bankers as much as they want.

    Daniel 21 16 hours ago
    @The Invisible Hand What happened in Greece, as in many other countries was that the state had to keep the banks from collapsing and depositors from being wiped out by borrowers. Your morality tale about all the hundreds of billions going to bankers is sweet, though, as I assume the conclusion you want everyone to draw is that borrowers should be given a free pass. No doubt, you would agree with Varoufakis that borrowers are helpless “alcoholics”, God bless them.

    The Invisible Hand 16 hours ago
    @Daniel 21 @The Invisible Hand
    Borrowers should not be given a free pass.
    But when a borrower cannot pay his banker, the banker (after exhausting all possible recourse) should face up to the loss and not expect the taxpayers to repay a bad debt. This is basic capitalism. To force EU taxpayers to guarantee 200 billion of Greek debt has been the biggest swindle in finance. Bernie Madoff is in jail for less.

    reijer 42 minutes ago
    @Swap Really, “private creditors are massacred”? The bailout and subsequent PSI actually let private moneylenders get out relatively unscratched. As always, it is European taxpayers who will take the real hit.

    Popperino 17 hours ago
    Greece, it’s over. Everybody is fed up. From now on you have to earn your own money.

    Youre O Crat 17 hours ago
    I want debt forgiveness of my car loan. Still have 4 years more to repay it. I mean, if the central bank takes care of it it is just electronic money, not real money, so why should they. I have many more years, as a consumer, to spend money and contribute to the goal of ever increasing GDP.
    Come on, give me a break and cancel that car loan.
    But I’m keeping the car!

    atlante 17 hours ago
    One way or another Greece is screwed. The Euro needs to be inhabited by the Germans only.
    Politics & finance are a mess without a real monetary & fiscal union. So much energy and resources wasted on a failed project.

    christopher c 16 hours ago
    @atlante Monetary union means debt solidarity all over the Eurozone
    Do you want to bail out the french,working 32h a week,not reforming ?? you can have them
    I REFUSE DEBT SOLIDARITY WITH FRANCE,ITALY (and Greece of course)

    Daniel 21 16 hours ago
    @christopher c @atlante The euro is doomed because in the eurozone the issue of debt and insolvency have inevitably found expression in the context national interests. The euro was for the good times. The Greeks had no problems with Germany, WWII, national pride or any of the other twattle that villa huggers like to bleat on about now when the money was flowing freely to build villas and buy cars and hot label clothes, and to fund the sky-rocketing pensions of some in the public sector.

    Swap 15 hours ago
    @Daniel 21 @christopher c @atlante The MOST IMPORTANT POINT here. Socialistic movements are about one thing and one thing only: put money in people´s hands without actually having to work for it or having to generate it. Yes, the complete opposite of the private sector (try collecting a paycheque from IBM or Apple not doing anything productive for them and they not generating cashflow). How can you give people money when they don´t do much if at all and when those activities don´t directly generate a dime? Easy. You can tax the private sector fools to no end. Ok, but maybe politically tricky. What else? You can print tons of new money. Yes, nice, but how about inflation? Anything else? Well, you can borrow massively. I like that, but will I find willing lenders and will the loans be cheap so that I can do it over and over and over again? Well, how about you join a club populated by really solvent countries and we say that you should be treated as any other member of the club.Great!
    As long as Greece could pay the unproductive massive public sector via borrowing, being in the EZ was very useful because being in the EZ was the only way Greece could fund those excesses via debt.
    But if capital markets close or slow down, even in the EZ, then the only solution becomes the printing press. If unlimited cheap borrowing is no longer possible then the EZ loses all attractiveness to a socialistic people because EZ membership precludes unlimited use of the printing press (or so we thought before QE).
    The more people want to communistic, the less attractive the EZ is because the more attractive the printing press is. Who needs monetary rigour when the whole point now becomes monetary insanity?
    The EZ is great for serious countries willing to create true wealth through a strong private sector. It is not great for countries that give up and surrender into the arms of the socialistic handout.

    Xenon 18 hours ago
    It is not even obvious that a formal exit from the eurozone is possible. The Treaty of Lisbon talks of irrevocably fixed rates and has no mechanism for expulsion from the eurozone or the EU. It makes provision only for a negotiated exit from the EU. I cannot see Syriza taking this option. De facto exit occurs when ELA is cut off but that is not a formal exit.

    Youre O Crat 16 hours ago
    Actually, the Maastricht Treaty established the Euro (EMU), fixed exchange rates.
    The Lisbon Treaty introduced, for the first time, the possibility of a Member State to exit the EU.
    Leaving the Eurozone has never been dealt with by an EEC/EU Treaty.

    Daniel 21 16 hours ago
    @Xenon Any sovereign state can do whatever it wants, whenever it wants. Sovereingty trumps ANY treaty. That’s why Tsipras constantly mentions that he is bound by the mandate he has received from Greek voters and democracy. He’s threatening the EU not to mess with sovereignty.

    maljoffre 16 hours ago
    @Daniel 21
    Not at all. The signed Treaties of the Union, passed by national parliaments, trump sovereignty. Tsipras is talking rubbish for the masses if he says otherwise. Anyway, there are only two or at the most three truly sovereign nations in the world and neither Britain nor Greece are among them.

    motinow6700 18 hours ago
    if you give in once to an aggressive beggar then:
    a) you’ll soon be surrounded by others; and
    b) none of them will ever forget it.

    to them, alms is a right to be demanded rather than a charitable act to be requested.

    but that’s the real world.

    here you’re dealing with EU socialist fairyland.
    the socialists on the periphery are calling out the socialists at the centre, saying that the broken economy of one must become the broken economy of all.
    pass the popcorn – this is going to be fun to watch.

    IR2012 17 hours ago
    @motinow6700 Where to start with this wrongheaded claptrap? Economics is not about imposing punishment on the weak. The US economy has strong and weak states economically however it does not force e.g. Louisiana to bear the whole brunt of a problem caused by failings across the globe at regulatory, government levels but most importantly in finance – the Federal Government acts in the interest of all. Europe is now dominated by a cabal of selfish and dangerous creditor nations who need to be stopped now. When lenders lend, sometimes borrowers default. We do not as a civilised society force people into penury in these circumstances. That is 19th century thinking.

    motinow6700 17 hours ago
    @IR2012 @motinow6700
    the song of the lazy bum wondering why the diligent worker is better off:- “why are you punishing me?”

    The Invisible Hand 17 hours ago
    @motinow6700
    You are absolutely right. And the beggars in this case are the bankers who made careless loans to Greece and are still enjoying a fat cigar, a fatter bonus and a Davos extravaganza at the expense of the taxpayers. Blame Merkel, Dijsselbloem and the euro-commissars for this huge transfer of wealth from the people to the banks.
    I am sure the grateful banks may offer some seats on their Boards when some deserving eurocrats retire.

    Swap 17 hours ago
    @The Invisible Hand @motinow6700 You don´t know what you are talking about. Private creditors (yes, banks) took a 75 pv loss in 2012, they were forced to swallow that bitter pill so that Greece could get the new 172 billion rescue. Bankers, yes bankers, were sacrificed so that poor Greece could have a chance at mending herself.
    Many of those who got repaid thanks to the bailout were Greek citizens and institutions, who had invested their savings in Greek government bonds. Many average global citizens were also helped in 2010, regular people with Greek bonds in their pension plans.
    You are probably one of those bitter at the fact that they never had a remote chance to even work as a bank teller. What, no fat cigar for the likes of you…?

    The Invisible Hand 16 hours ago
    @Swap @The Invisible Hand @motinow6700
    On your ad hominem I enjoy my Remy Martin without a cohiba, thank you. And I hope you are not one of those sun-tanned bankers sipping pflumli in Davos that I offended with my frankness.
    But your statistics are only half right. Yes, the bankers took a haircut on GGB. But then the EU is giving Greece a couple of hundred billion euro of which near 90% is going to the bankers. Greece is mathematically unlikely to repay these amounts.
    So, yes, the bankers did get a modest haircut.
    The EU taxpayer is, unfortunately, getting the full brazilian.

    Swap 16 hours ago
    @The Invisible Hand @Swap @motinow6700 What bankers? There are no bankers anymore. 30 bn of old government bonds left that´s all. And these amortize in 2022-42 so they haven´t been paid. The big money (2012 rescue) was used to recapitalize the local banks (ie, to shelter the Greek citizen from chaos), to finance the deficit (ie, pay state salaries and pensions), and to keep repaying the IMF and the ECB/NCBs so that Greece doesn´t definitely become a pariah nation. In other words, the bailout was used to allow the government to make crucial expenditures that it otherwise would not have been able to make ever.

    The Invisible Hand 16 hours ago
    @Swap @The Invisible Hand @motinow6700
    Come on, now, don’t be thick. The money due to EFSF, ECB, IMF was used to repay careless banks (including some Greek ones). Only 25 billion or so (out of 200 billion) ended up on new government spending. The rest was used to save the bankers striped pants.
    Greece is a pariah nation anyway. It would have been far wiser if the losses were borne by the banks responsible and not shifted to innocent taxpayers in the EU.

    Swap 16 hours ago
    @The Invisible Hand @Swap @motinow6700 “Only” 25 or so (27 apparently)? Greece could not have raised 1 bn on its own. So that´s 27 bn in government spending that Greece was allowed to indulge in thanks excusively to the bailout.
    So guess what? Thanks to the bailout, Greek government spending was much higher than otherwise. Some austerity!

    The Invisible Hand 16 hours ago
    @Swap @The Invisible Hand @motinow6700
    You are right for a change. Greece was enabled to spend 25 (or 27) billion that it could not otherwise raise.
    But why give even 25 billion tax-payer money to Greece if it is obviously impossible to recover? And why give the other creditors to Greece another 180 odd billion guarantee fro EU taxpayers on mismanaged debt? EU leaders owe a responsibility to their voters, not to Credit Agricole or DEPFA.
    And if you reply that the 200 billion will be repaid I have a Greek bond I want to sell you.

    Swap 16 hours ago
    @The Invisible Hand @Swap @motinow6700 Of course they won´t be repaid. That´s the scandal.
    Btw, if banks are so evil, what´s Greece doing hiring Lazard (French!) and what is Lazard doing saying that there should be a 100 bn debt writeoff???

    The Invisible Hand 16 hours ago
    @Swap @The Invisible Hand @motinow6700
    Banks are not evil. I love banks. My bankers offer me coffee when I visit. But I don’t expect any taxpayer to compensate me for the drop of my UBS shares from $120 to $16 over 8 years through their BoD’s idiocy.
    You raise an interesting point about Lazard. Dr Varoufakis could have told the troika where to go just as eloquently as Lazard. Maybe he needs the cachet of an esteemed trans-atlantic capitalist establishment institution.

    Daniel 21 16 hours ago
    @The Invisible Hand @motinow6700 Hey, you didn’t use the word “Nazi” in your post. You forgot the most important point in your logical argument.

    The Invisible Hand 16 hours ago
    @Daniel 21 @The Invisible Hand @motinow6700 The FT doesn’t allow the “N” word. Besides, some of my best girlfriends were German.

    IR2012 18 hours ago
    This is a really important moment in this slow motion disaster. The democratic legitimacy of the current ‘leadership’ of the EU is eroding at pace. They need to wake up, understand what’s coming and start acting in the interest of the EU as a whole, not a small number of creditor countries or things will start to get very messy. Stand firm Greece – the saner (and less selfish) among us are with you.

    Stephen Swanson 18 hours ago
    I don’t think there is any amount of money that Greece can borrow without it eventually collapsing; it’s a broken economy.
    As to economic literacy, most assign blame to Greece’s problems on its massive debt load which is actually a symptom of structural flaws that precipitated two bailouts, private sector haircuts and immediate needs for debt relief.
    In recent history, the country sustained itself on debt. What has brought the country to its knees is the need to curtail borrowing, cut back spending, adhere to provisions of SGP (too strict) and failed structural reforms. And now the economy is imploding.
    While its intellectually simplistic to urge to Greece to fight on, it’s not constructive advice because whatever battle is one or loss will be replaced by another and and yet another battle until Greece’ economy is fundamentally reformed through getting rid of the guilds, reaxing product market regulations, downsizing government, eliminating systemic corruption and improving collection of taxes.
    Bloomberg recently ran a piece discussing debt burdens and noted that both Portugal and Italy had higher debt servicing budens than did Greece in 2012. What about their dignity? The same article reports that:
    Greece’s position in the World Bank’s ease of doing business rankings is lower than that of any of the nations mentioned above, which reflects a low level of institutional development and a lack of effort on Greek governments’ part to support private enterprise. In Transparency International’s Corruption Perceptions Index for 2014, Greece also lags behind Portugal, Hungary, Estonia, Latvia and Slovakia, sharing the 69th spot in the world with Romania. Businesses see it as one of the most corrupt places in Europe.
    Unless the Greek economy is overhauled and made competitive, Greece will remain a black hole in which debt will simply vaporize.

    IR2012 18 hours ago
    @Stephen Swanson
    “I don’t think there is any amount of money that Greece can borrow without it eventually collapsing; it’s a broken economy” – Fact free and economically illiterate

    maljoffre 17 hours ago
    @IR2012
    ….Not to mention profoundly ignorant, a state of mental deficit which Swanson seems to excel in. Greece has started budget surpluses against the greatest political, social financial odds imaginable: “loans” that see well over 90% (over 100% according to Paul Krugman) of principle and interest returned to the “lenders” while the country’s debt explodes, and keeps rising, beyond the figure at the beginning of the agreement when the “lenders” agreed to “help” Greece.

    genauer 14 hours ago
    @maljoffre
    when you started commenting here, your sarcasm was refreshing.
    Now you seem to be incapable to write just one comment without personal derision and insulting.
    If you go on like this, in half a year you will sound like Elfie

    Stephen Swanson 13 hours ago
    @IR2012
    I will happily respond to your comment while overloooking the comment offered by maljoffre as he continually resorts to ad hominem attacks because he lacks the depth and intellectual reources to argue with logic, fact or cogent thinking.
    He tries to present himself as informed and knowlegeable when, in fact, he is an intellectually starved little troll who has never had an original idea and views complex matters through a lens reducing outcomes to black or white. Nuances escape him.
    To understand Greece’s future is to understand its past.
    Greece’s impressive growth between 2001 and 2007 had little to do with a dynamic capitalist economy. “Growth relied on the twin pillars of state borrowing and European Union (EU) transfers. Between 2002-2006, EU transfers amounted to approximately 20 billion euros, which, according to some estimates, equals about 3.3 percent of annual GDP.”
    And because of interest rate convergence and its rapid growth rate, Greece was able to service its debt and with access to cheap credit; high growth rates were easier to attain for an economy with other severe structural economic weaknesses. Indeed, during the period under consideration, the yield on Greek 10-year bonds was just marginally higher (0.3 percent) than on their German counterpart.
    And during this ame period Greece paid billions of euros to its creditors, and yet its debt did not decrease but rather increased. This is the same ugly and vicious cycle of debt that many Latin American and other third world countries found themselves in at the height of western financial exploitation back in the 1960s and 1970s.
    If we fast forward to today, the debt party is over and the economy is perhaps bottoming after contracting 25%, we are negotiating bailout III and the economy is likely ran a primary surplus of 1.5% to 3.0% in 2013 and 2014 only as a result of austerity. maljoffreas, who is easily confused, conflates primary surpluses (before debt servicing) with budget surpluses (after all expenses).
    But bottoming is not the same as recovering and its my position that whater the primary surplus, which is much debated for this year* I dont’ know how an economy led by a socialist government and saddled with a public sector which accounts for about 60% GDP, little manufacturing, some agriculture, few natural resources, rampant corruption, dire international standings and some tourism can realize sufficeint growth and promary surpluses to ever get out of debt.
    I believe current trends and developments in the country make for a bleak economic future and the unfolding off a social dystopia, leading to lower economic growth rates. Here is a link to an article appearing the NYT written by a professor of law and economics at the University of Athens with similar views to mine.
    http://www.nytimes.com/roomfordebate/2015/01/27/can-greeces-anti-austerity-government-succeed/greece-needs-broader-structural-reforms-than-syriza-has-proposed
    You are encouraged to respond in proportionate detail and economic literacy,

    * According to the budget, Greece will achieve a primary budget surplus—before taking into account debt payments—of €3.3 billion ($4.1 billion), equal to 3% of gross domestic product, next year, which is in line with the country’s bailout program.
    Overall, the government will record only a minor budget deficit of €338 million—equivalent to just 0.2% of gross domestic product—next year, in effect marking the first balanced budget Greece has produced in four decades.
    Despite surpassing its budget targets for three years running, Greece is at loggerheads with the troika—made up of representatives from the European Commission, the International Monetary Fund and the European Central Bank—over further fiscal measures the country must take, as well as a number of promised overhauls.
    The troika sees the government’s budget deficit next year at closer to 3% of GDP and has asked Greece to make somewhere between €1.8 billion and €3.5 billion in additional cutbacks for 2015.

  • #194138

    Sancho the Fat
    Participant
    Neophyte

    cont…

    Stephen Swanson 13 hours ago
    @IR2012
    I will happily respond to your comment while overloooking the comment offered by maljoffre as he continually resorts to ad hominem attacks because he lacks the depth and intellectual reources to argue with logic, fact or cogent thinking.
    He tries to present himself as informed and knowledgeable when, in fact, he is an intellectually starved little troll who has never had an original idea and views complex matters through a lens reducing outcomes to black or white. Nuances escape him.
    To understand Greece’s future is to understand its past.
    Greece’s impressive growth between 2001 and 2007 had little to do with a dynamic capitalist economy. “Growth relied on the twin pillars of state borrowing and European Union (EU) transfers. Between 2002-2006, EU transfers amounted to approximately 20 billion euros, which, according to some estimates, equals about 3.3 percent of annual GDP.”
    And because of interest rate convergence and its rapid growth rate, Greece was able to service its debt and with access to cheap credit; high growth rates were easier to attain for an economy with other severe structural economic weaknesses. Indeed, during the period under consideration, the yield on Greek 10-year bonds was just marginally higher (0.3 percent) than on their German counterpart.
    And during this ame period Greece paid billions of euros to its creditors, and yet its debt did not decrease but rather increased. This is the same ugly and vicious cycle of debt that many Latin American and other third world countries found themselves in at the height of western financial exploitation back in the 1960s and 1970s.
    If we fast forward to today, the debt party is over and the economy is perhaps bottoming after contracting 25%, we are negotiating bailout III and the economy is likely ran a primary surplus of 1.5% to 3.0% in 2013 and 2014 only as a result of austerity. maljoffreas, who is easily confused, conflates primary surpluses (before debt servicing) with budget surpluses (after all expenses).
    But bottoming is not the same as recovering and its my position that whater the primary surplus, which is much debated for this year* , I dont’ know how an economy led by a socialist government and saddled with a public sector which accounts for about 60% GDP, little manufacturing, some agriculture, few natural resources, rampant corruption, dire international standings and some tourism can realize sufficeint growth and promary surpluses to ever get out of debt.
    I believe current trends and developments in the country make for a bleak economic future and the unfolding off a social dystopia, leading to lower economic growth rates and long tem disillusionment. Here is a link to an article appearing the NYT written by a professor of law and economics at the University of Athens with similar views to mine.
    http://www.nytimes.com/roomfordebate/2015/01/27/can-greeces-anti-austerity-government-succeed/greece-needs-broader-structural-reforms-than-syriza-has-proposed
    You are encouraged to respond in proportionate detail withas much economic literacy as you can muster.

    * According to the budget, Greece will achieve a primary budget surplus—before taking into account debt payments—of €3.3 billion ($4.1 billion), equal to 3% of gross domestic product, next year, which is in line with the country’s bailout program.
    Overall, the government will record only a minor budget deficit of €338 million—equivalent to just 0.2% of gross domestic product—next year, in effect marking the first balanced budget Greece has produced in four decades.
    Despite surpassing its budget targets for three years running, Greece is at loggerheads with the troika—made up of representatives from the European Commission, the International Monetary Fund and the European Central Bank—over further fiscal measures the country must take, as well as a number of promised overhauls.
    The troika sees the government’s budget deficit next year at closer to 3% of GDP and has asked Greece to make somewhere between €1.8 billion and €3.5 billion in additional cutbacks for 2015.

    Swamp Yankee 17 hours ago
    @Stephen Swanson Stephen I have to thank you for making the informative posts which I lack the patience to gather the data for, and lack also the serenity to compose with a civil tone.
    Somebody’s gotta do it; thanks for stepping up.
    Any new program or deal just creates new debt to be crammed down the same pile as the existing debt – a kind of midden heap of toxic bonds. Burn them on the way out of the Euro.
    That, or embrace a transfer union, from each according to his surplus, to each according to his deficit. Or that.

    genauer 15 hours ago
    @Stephen Swanson
    I also want to thank you here.
    You repeatedly provide the relevant data (Federal Reserve swap volume) and the relevant reports, the important information I did ask other people for, who made unsubstantiated claims.
    This let the discussion back to civility.
    Good to have you here !

    Stephen Swanson 14 hours ago
    @genauer Thank you. I don’t why people can enjoy discussion and debate without recriminations.

    maljoffre 18 hours ago
    Münchau feins support for Greece, and slyly sneaks in the same tiresome and losing ditty he’s been humming for the past 5 years, Grexit. He has clearly been dismayed by the broad support Greece has received across the world to resist and change the failed policy that has led to five years of depression and 28% unemployment – 60% among the young – especially the fulsome support from the EU’s political and military master, the United States, so he tries to breathe life into the dead horse of a “parallel currency” or “Grexit by another name.”
    After predicting, insisting really, political, social and financial catastrophe for Greece over the last five years, Münchau has now realized that he is going to have to eat his words. Mahlzeit, Herr Münchau. There will be no “parallel currency.” And there will be no Grexit, not now, not soon, not ever.

    Paul A. Myers 18 hours ago
    “…a semi-exit with a parallel currency and a default on official creditors only…”
    Testing this line of advance makes so much sense on so many levels. (Reading this wonderful commentary one wonders if we’re mining the deepest fantasies of the darkest corners of Martin Wolf’s mind!)
    At the worse case, default and exit. But would not a lot of other money from the world economy be willing to enter the Greek space. If nothing else, some pretty nice assets would be pretty cheap. If Denmark and Sweden maintain their own currencies while being in the European Union and tightly integrated into many euro countries, would not a Greece using drachmas have some competitive and comparative advantages? The tourism industry would still be mostly euros. It would also be easy to add sterling and dollars to the mix. Could Athens become some sort of financial entrepot, one of those successful places where the caravan routes cross.
    The Original Sin was not writing the bad debts off on the books of the banks who made the bad loans. The true policy failures were in Paris, Brussels, Frankfurt, and Berlin.
    Superb commentary from Mr Munchau.

    The Invisible Hand 17 hours ago
    @Paul A. Myers You have hit the nail on the head. This has been the biggest transfer of wealth from taxpayers to bankers, ever. The euro commissars knew all along that the Greek debts to the banks could never be repaid, and chose to help their friends out. And feigning innocence they insist that the debts will be repaid and encourage their taxpayers to blame the Greeks by cherry-picking some extreme examples of real Greek economic mismanagement.
    The invective in these columns against Greeks is near racist in some cases.
    This is not to deny that serious reforms are necessary in Greece and that is where extreme pressure should be applied.

    Don10984408 18 hours ago
    Allies don’t “stand up” to each other in major confrontations – they persuade, preferably with facts and logic.
    Where is the superior alternative Greek policy for living within their means, and not requiring decades of large subsidies of an unsutainable government spending regime?

    RiskManager 18 hours ago
    @Don10984408 Haven’t read their proposals then? Or listened to their irrefutable argument that current policy cannot succeed even in the narrow sense of creditors getting their money back with interest.
    You are flogging dying horses, and I dont care how bad the horse has been to you personally!

    Don10984408 17 hours ago
    @RiskManager
    Syriza is like the GOP in the USA – 58 votes to repeal “Obamacare” – not one unified proposal to replace it.
    So Greece is with the EU – it’s the worst bargain in the world until the 100% lack of alternatives comes into play.
    Free money in a bridge loan – also never to be paid back?
    Hire back all laid off government workers – with free money again?
    Beg Putin or China for handouts?
    I have yet to see Greece propose “reforms” to stabilize business, attract investment, or even make it to March for that matter.

    RiskManager 16 hours ago
    @Don10984408 Yep, obviously haven’t read them. Rah rah, blah blah. Why not have a read? They want to hire back some workers, not all, they want to repay all loans but on Bisque Bind terms and they want to smash the corrupt elites and professions and collect taxes due, a task all the previous govts have failed to do being, as they were, part of that elite. So there is substance, why not address it directly?
    p.s Yah, booh, blah blah. Hope that helped 😉

    ciciritto 18 hours ago
    Why is there no discussion of bailing in creditors? The previous bail-outs clearly aren’t working. Those who lent irresponsibly to Greek banks in the first place should take the first cut.

    Tall ship 18 hours ago
    A very sensible and honest account of the present situation. Thank you for this article Mr Munchau.

    A Lisboner 18 hours ago
    As I understand it (hardly, I must say) from my indebted country, which has never been richier than now (February 2015), even after a bit of «austerity» (5 to 6pc decline of GDP; in my personal case about 40-50pc less of my net income after retirement…), Herr Münchau and most of FT commentators have been wishing the € to break down for the past 25 years and still they didn’t get it! I rather keep a few €€ than a lot of my previous $$ (escudos as they were called). And if I were Greek I wouldn’t have tried to blackmail the EU by threatening to destroy the eurozone. Most likely, Portugal will survive a loss of a few billion €€ if Syriza blows it all up for alleged patriotic reasons because it hates (understanbly) the memories of Nazi occupation and (less understanbly) it looks forward to an alliance with former Soviet Union…

    ramirez51 18 hours ago
    @A Lisboner Do you think that austerity for Portugal has been a success? How many unemployed today and how many before the crisis struck ? and how many in 2016/2017 ? In other words when Portugal will reach pre crisis level of employement ? Impossible to do better ?

    RiskManager 18 hours ago
    @A Lisboner Not fussed about your grandchildren then? Hows it working out for their generation in the Euro recovery, and the generation after as well if you stay in the fixed exchange rate system with Germany, because they will always outrun you, its what they are like, they beat everyone which is why they have the worlds largest trade surplus.

    christopher c 18 hours ago
    I love the new proposals :IOUs..seems a great idea to implement those…Decide tomorrow and implement in real life before the end of march !!
    How many square kilometers of IOU will Syriza manage to print in one year ?? let’s say 100.000 sq km2 because of amazing future growth coming anytime after !!
    Who will accept IOU from greek Syriza ? there’s just one guy with XXL cojones to buy them all….He’s a former Goldman Sachs guy..He’s now running a hedge fund backed by taxpayer money.His name is Mario Draghi
    (Greece will never be able to pay back 300B euros..How can they all try to deny reality ? Zirp,FESF,QE,IOU..Do we pay eurocrats 24.000 euros a month to keep creating an ever bigger Ponzi scheme ?)

    filmaxlanc 18 hours ago
    suppose we eurozone europeans bail out greece, then what? the previous government barely implemented any reforms, and Syriza doesn’t sound like a great reformer either. Meanwhile greeks are not paying their taxes any much more than in the past as anyone traveling there can experience first hand. So in five years there may be another crisis. Perhaps portuguese and lithuanians are right: why bail out a fiscally irresponsible and unrepentant country? italy, spain, portugal, ireland are all experiencing deep social suffering and displacement due to austerity programs and reforms. many greeks are now suffering deeply following the austerity program, but the country as a whole seems unable to reform. then perhaps it should leave the euro. the economy would revive quickly and Syriza could claim victory. After all, Syriza campaigned against the euro, and perhaps it remains their “hidden agenda”. It is up to the greeks then to choose between austerity and the euro, or profligacy and the drachma. An orderly grexit may benefit us all.

    Swap 18 hours ago
    Let´s take a closer look at those “failed, terrible” policies that “austerity” brought with it.
    Overall picture, not the minutiae of this or that specific example.
    – Greek gross government spending HIGHER in 2010-14 (bailout, “austere” years) than in 2004-08
    – Greek government spending/gdp HIGHER in 2010-14 (bailout, “austere” years) than in 2004-08
    – Greek gross government employee compensation HIGHER in 2010-14 (bailout “austere” years) than in 2004-08
    – Greek government employee compensation/gdp HIGHER in 2010-14 (bailout “austere” years) than in 2004-08
    Revolutionary political, social. and economic developments are being justified on grounds of the allegedly insufferable consequences of something tagged as “austerity”. Well, judge for yourselves: would you label an increase in overall government spending and government employee compensation as “austerity”???
    And as for “failed” policies, I guess we are not talking about the Irish success here: booming economy, repaying the IMF early, borrowing at 2% for 30 years in the capital markets. And Ireland, mind you, also went through a conditions-filled bailout program.
    Maybe it´s something specific to Greece that makes it a basket case? Like, say, the very dominant, and not by far undiminished, role of the state in economic affairs?

    RiskManager 18 hours ago
    I wonder if Europeans might look back after this dark chapter is finally closed and say “Never…. in the field of mercantile conflict…… have so many….. owed so much…. to so few”

    No, not that Dr. Doom, the other Dr. Doom 19 hours ago
    Great article, I especially enjoyed the use of the word “insane” to describe EU policy. I hope Mr. Varoufakis reads this sometime today.
    If I were to speak to Mr. V., I would tell him to break the Euro into a million pieces before giving in. Now is the time to fight, to not back down, no matter what.
    Would that Martin Wolf were publishing articles like this one.

    Felix Drost 18 hours ago
    @No, not that Dr. Doom, the other Dr. Doom
    It’s probably not your Euro is it.

    No, not that Dr. Doom, the other Dr. Doom 18 hours ago
    @Felix Drost
    If you have an argument, you should make it, that would be better than trolling remarks like this one.

    Felix Drost 18 hours ago
    @No, not that Dr. Doom, the other Dr. Doom @Felix Drost
    Just curious if it is. It is mine, my government and banks in my country hold vast debt and risk in Greece. I find the suggestion to break up the Euro into a million pieces exceedingly reckless. So one wonders if he or she doing the suggesting has any ownership in the Euro. I think not.

    No, not that Dr. Doom, the other Dr. Doom 18 hours ago
    @Felix Drost
    I’m mostly saying the same thing that Mr. Munchau says in this article, just more strongly. You should comment on his article directly.

    Felix Drost 18 hours ago
    @No, not that Dr. Doom, the other Dr. Doom @Felix Drost
    So the answer is no, you don’t.

    No, not that Dr. Doom, the other Dr. Doom 18 hours ago
    @Felix Drost
    As I said, you should comment on Mr. Munchau’s article, not troll people making comments.

    Felix Drost 15 hours ago
    @No, not that Dr. Doom, the other Dr. Doom @Felix Drost
    I am a troll frequently but wasn’t trolling in this instance. I’m very serious.

    ramirez51 18 hours ago
    @Felix Drost @No, not that Dr. Doom, the other Dr. Doom Your gov. and your countries hold vast portion of Greece’s debt ? Their mistake. Who obliged them to buy Greece’s treasuries or to lend money to a Greece party ? Next time ask for collateral. No collateral no money. It’s easy.

    Felix Drost 15 hours ago
    @ramirez51 @Felix Drost @No, not that Dr. Doom, the other Dr. Doom
    We bailed out banks and bought their debt in order to save the banks, the pension funds, the foundation of our economy, of our society. It is madness to suggest banks should crash, it reveals a failure to understand just how central they are to our well-being.
    Do we need reforms? Urgently. Do we need to work on the crushing debt that most of Europe suffers from? Certainly so. Would I like some bankers to suffer for their blindness and arrogance? Yes. But the last thing we need is ill thought out “solutions”.

    GlobalEconomist 10 hours ago
    @Felix Drost @ramirez51 @No, not that Dr. Doom, the other Dr. Doom Exactly. The whole bailout effort was to save German (and French) banks, not Greece. Maybe this was systemically the right thing to do. What was not the right thing to do, was to push the Greek people into unspeakable hardship so that shareholders of Deutsche Bank don’t suffer. The policies are an unmitigated failure and must be ended. Once again, I remind Germans that the rise of Hitler was not caused by hyper-inflation, but by the deflationary policies of Bruning, which resulted in mass unemployment. And these are exactly the policies, Germany is now imposing on the so-called periphery. A disaster.

    ramirez51 18 hours ago
    @Felix Drost @No, not that Dr. Doom, the other Dr. Doom Who lent money to a failed Greece must pay for his mistake. easy

    Greek 16 hours ago
    @ramirez51 @Felix Drost @No, not that Dr. Doom, the other Dr. Doom
    Truth is, in the middle of the post 08′ financial crisis, Governments knew that non-Greek Corporations (financial and not) couldn’t afford a Greek default.Before the first loan (09′) the majority of the Greek debt was held by foreign, non-government, creditors. So they bailed out their corporations and transmitted the debt to national governments.
    They knew what they were doing, they were experimenting, and now that all the evidence suggest it was a failed policy, they want to keep the pressure up for political reasons.
    I don’t praise Greek Government policies of the last decades, which consisted in borrowing vast amounts of money to create a delussion of presperity and growth, but crashing a nation and bringing it to the knees, for punishment and justice isn’t quite the spirit for the European ideals.
    I don’t know why so many people assume that the Greek government asks for a bailout with no conditions. Even Mr Varoufakis openly admitted that 60-70 % of the current reforms plans is on the good direction.What we need to change is some of the measures (like the 4% primary surplus ) in order to let the economy “breathe”.

    Paul Munton’s Potimarron 15 hours ago
    @No, not that Dr. Doom, the other Dr. Doom @Felix Drost
    I have read many intellegent posts by Felix Drost; I may not agree with them but he cannot, with justice, be called a troll.

    Felix Drost 15 hours ago
    @Paul Munton’s Potimarron @No, not that Dr. Doom, the other Dr. Doom @Felix Drost
    Why thank you I don’t mind the epithet much. There’s a bit of a troll lurking in most of us. :)
    In this case hoever not. I am in favor of debt relief and see the necessity, especially for Greece. I just don’t think that I should pay for it. Or that other EU countries are any less entitled to relief.

    No, not that Dr. Doom, the other Dr. Doom 12 hours ago
    @Paul Munton’s Potimarron
    Trolling, in the context of the FT, is to make very general negative remarks about an article and not reply specifically to the points raised by the writer.
    For example, has austerity worked or not? A troll will not answer that question directly. Mr. Drost did not answer that question directly when I put it to him and thereby fails to address what Mr. Munchau was discussing.
    Therefore, Mr. Drost is a troll.
    QED

    Saltpeanuts 19 hours ago
    Some 25% of taxes due in December were not paid in Greece. Why should anybody worry about an old habit? Therefore nice idea the introduction of a parallel currency for Greece like the “tax anticipation notes” backed by future tax revenue.

    Mark Saravari 19 hours ago
    Greece can’t be forced out of the euro, and will not choose to abandon it. It certainly won’t accidentally fall out of it. The impending crash will involve all the carriages of the euro train….or will be avoided.

    Felix Drost 19 hours ago
    Whats to prevent any Eurozone economy from printing pretty food stamps+ until the Euro is no longer relevant? As if this stratagem is going to help the other heavily indebted countries or fix the underlying issues.

    Richeightyeight 19 hours ago
    The main issue with Greek exit is that in a few years the rest of the periphery will envy their progress. The cost to Greece for its political profligacy has been as large as It was to Germany after the Treaty of Versailles. The grand experiment designed to make conflict impossible on the continent has instead led to its economic devastation.

    Felix Drost 19 hours ago
    @Richeightyeight You’re assuming that Greek debt will be written off if there’s a grexit. I highly doubt it. Greece won’t see progress if people continue to want their money back to the tune of hundreds of billions of dollars. Debt is the problem, not the EU trying to manage it while keeping everyones interests in focus.

    No, not that Dr. Doom, the other Dr. Doom 18 hours ago
    @Felix Drost
    Has the policy of austerity worked or not? Or perhaps you should put forth your reasons why the policy of austerity has succeeded.
    I don’t see how you can, since all of Southern Europe has been going through a 2nd Great Depression since 2010. How is that success?

    Felix Drost 18 hours ago
    @No, not that Dr. Doom, the other Dr. Doom @Felix Drost
    Oh I’m all for spending much more money, but whose money is it going to be? If it’s governments in the north then that needs to be agreed upon. If it’s printing money then that needs to be agreed upon. No amount of Greek blackmail or Munchau wisdom ought to change the basic nature of the Eurozone which is that agreements are reached through debate and compromise.

    GlobalEconomist 19 hours ago
    Completely agree. Syriza must avoid capitulation. Golden Dawn will be the almost unquestionable consequence of such capitulation. My fear is that Germany just does not get it and the others stick to their guns too for the reasons mentioned. A coalition of the “villains”.

    The Whip 19 hours ago
    1) If Greece cannot be kicked out of the EZ(and even less from the EU where Greece would get leverage via there veto on any EU tax and foreign policy decision), why could’nt the Greek central bank print [false] EU money? Any EU printed money should legally rank pari passu.
    2) Austerity without devaluation of currency cannot work since the only way to improve growth is via currency adjustment (devaluation) which is impossible in a fixed exchange rate system
    3) The only other way (which has been used by Greece, Spain, etc.) is internal deflation on salaries to improve productivity and the terms of exchange
    4) Well, one has not to forget that any productivity increase works to improve the trade balance if there are client to buy such goods; it is futile to try to compete on costs only for a “developed” economy

    jako 19 hours ago
    @The Whip Greece is not a developed country and is unable to run anything but a giant trade deficit, regardless of currency. There has never been any economic growth, only borrowing tot the infinite. That translates in false economic growth figures, ‘Austerity’ in Greece only took borrowing out of the equation showing the underlying problem: Greece is a third world country with hardly any economy at all.

    The Whip 18 hours ago
    @jako @The Whip

    I tend to agree; selling feta cheese is not going to much improve the trade balance whatever any currency devaluation or salary deflation. Therefore what is Greece doing within the EZ and the EU too?

    The answer is nothing and they shold never have been admitted; but politics, always politics…

    The Invisible Hand 18 hours ago
    @The Whip @jako Just to point out that feta cheese and olive oil are less than 3% of Greek exports by value. And total exports of around 30 billion annually do not include substantial foreign earnings from shipping and tourism. But please do double your feta cheese consumption, every little bit helps.

    michaelgm. 3 hours ago
    @The Invisible Hand @The Whip @jako
    Yes tourism- it’s about one of few things that brings in revenue in Greece…
    But then these same people – sit around for 6 months in the winter – and get unemployment payments for 6 months – until the next tourist season…
    In essence, the Greek state breaks even – if you consider the VAT that most hotels don’t even pay back to the government…

    Ca 18 hours ago
    @The Whip @jako You have of course seen the UK current account deficit which is even worse than Greeces’? Thought not

    Tom Warner 19 hours ago
    I don’t think Munchau or Cochrane or Parenteau have thought through their parallel currency idea. Above all, there is no option where the Bank of Greece keeps Greek banks liquid in euros while the Greek government defaults on debts to the EU. That can’t happen, period, so better not to give Greeks any illusions about that.
    The economists are talking about two very different things: a mere IOU that no one would be obliged to accept as payment, or a true parallel currency that would be legal tender or at least accepted by the state as payment for taxes.
    An IOU would simply be another domestic debt issue. If it were used to pay government bills while euro revenues were used to satisfy creditors, the effect would be deep austerity, as everyone with publicly derived income would be getting IOUs, which they couldn’t spend and could only sell at a deep discount. If IOUs were used to fund deficit spending while defaulting on debts to the EU, the Greek banks would run out of euros quickly.
    A parallel currency would chase the euro out of Greece. If the Greek government accepted it as payment for taxes, payment of taxes in euros would cease and euro supply within Greece would dwindle. If the currency was legal tender that everyone was obliged to accept, euros would be used only to settle bills for imports and would rapidly disappear from Greece. If banks received loans in pseudo-euros from the BoG and banks were allowed to satisfy euro depositors with pseudo-euros, that would be a de facto mandatory conversion into a new Greek currency. In all such cases there would be an FX rate between the pseudo-euro and the euro.
    Munchau might believe that sort of de facto Grexit would be better for Greece. But Munchau is a German leftist, not a Greek. Greeks want to both stay in the euro and reverse austerity. Which won’t happen, not because Germans are ideologically in favor of austerity, but because human beings are self-interested and don’t like to give their money away. So Greeks must ultimately choose between austerity in the euro or Grexit. They haven’t yet decided, and it looks very much like Europe will let their banks run out of cash in the meantime.
    http://globalizedblog.com/2015/02/europe-girds-for-greek-default.html

    Opinionated 19 hours ago
    All debts everywhere will be forgiven eventually, why do you think they are instituting such an aggressive QE program? Once they buy those bonds they will never see the light of day again.

    Paul Munton’s Potimarron 19 hours ago
    Good fierce writing Mr Wolfgang Münchau! Tomorrow is indeed an opportunity for both Greece and the Eurozone.

    GC Hart 19 hours ago
    Exactly (2) – an exit from € is the best solution for Greece. Do it, take the hit and recover. It’s the only solution. Even Arg recovered after 1Q. Why can’t Greece?

    William Thayer Sr 19 hours ago
    1. Greece should exit the EZ for the sake of the Euro and the remaining EZ nations.
    2. Greece should exit the EZ for the sake of Greece.
    3. IOUs aren’t going to save Greece. This is just another desperate “extend and pretend” measure. Jobs are what is going to help Greece. If the EZ could think intelligently they would realize that they have exported millions of jobs to China…..because it was cheaper to make stuff there. Well, Greek labor costs are now competitive with China. Set up SEZ in Greece and bring back 1 million of those exported jobs from China. Duh.

    Night Watchman 14 hours ago
    @William Thayer Sr
    Irony apart, William Thayer Sr, is that how you really see it ?
    What has provoked you, or in cited you into this latest post ?
    Please no “trap question” slant in that !
    I am not one of the herd. What you have to say, and why, interests me.

    Serf8973521 19 hours ago
    Brilliant. Keep throwing more good money after the bad. That ought to cure it.

    Night Watchman 14 hours ago
    @Serf8973521
    So, your line is still : “Parlons peu ; parlons mal ” ?

    Burtonshaw 19 hours ago
    Very good article, and almost spot on. The only question would be whether Greece ought in its own interest to stay in the eurozone. First, why should anyone (except the German sole benficiaries) stay in a conceptually wrong and demonstrably dysfunctional arrangement ruled by economic “thinking” proven wrong already 85 years ago? Second, once the current prolonged crisis is over, the zone is likely to develop new imbalances and thus new crises – why subject oneself to that? Third, for Greece to prosper inside the zone it would one way or another at some time have to complete its internal devaluation – a painful process as has been wel demonstrated in several countries – is that worth it? Fourth, departure from the zone might well be high risk (including risk of vengenance from the woud be euro-rulers) – but if done right (an important precondition), high risk can give the high rewards.

    el supremo 19 hours ago
    yes, but the keneysian policy ,while is the best at present ,is not a solution for ever as implied in the article. only a step towards fiscal responsabilities.

    Ca 20 hours ago
    Fantastic article. Completely agree.

  • #194137

    kolofarthos
    Participant
    Homeric

    Thanks for posting that Sancho……but I am sorry it’s a bit more than my brain cell can take in at one go :roll:
    Some of that discussion reminds me of some on another Greek forum in years gone by that I used to look at, just the odd personal insult traded.. :(

    No doubt somewhere in there are some pearls of wisdom !

    Plenty for Kiwi to catch up with though ic_wink

  • #194139

    Shazzie
    Participant
    Oracle

    Ow my brain hurts !!!!

  • #194140

    KP
    Participant
    Aristotelic

    Sancho….. your stamina in simply copying and pasting is quite impressive….. Now for those of us without your viagra, so lacking your level of stamina and staying power, please can you give us a single sentence summary of that lot? :roll:

  • #194141

    brenda
    Participant
    Hoplite

    @Shazzie wrote:

    Ow my brain hurts !!!!

    Mine shut down completely.

  • #194142

    kiwi
    Participant
    Aristotelic

    Good job sancho reb_bravo I also find a lot of interesting ideas and reality checks in reading the comments after all articles. I need to catcH up with what’s been happenng the last week.

  • #194143

    kiwi
    Participant
    Aristotelic

    Last minute bailout as predicted but for four months. Schauble has a smirk on his face because the man with the money makes the rules…but, dare I hope that this will give the Greeks more time to make changes needed and get ready for the next round.

    I think the Greeks might now have time to build a Trojan Horse…

  • #194144

    kolofarthos
    Participant
    Homeric

    I like your comment about the horse reb_bravo

    Not yet fully agreed, four months extension subject to a letter defining Greek policies that will be introduced to meet the bailout conditions to be delivered to EU by Monday, acceptability of those policies and then ratification by individual countries.

    One might have thought the latter would be a rubber stamp job but who knows?

    However, it might seem that Alexis has lost face a bit – I’ m sure he’ll present it in a positive light – but it will give Syriza time to find alternatives that the Troika would not agree to at this time, maybe.

    Possibly time to buy some Euros or should I hold out for now and expect to buy Drachmas later? 😕

  • #194145

    kolofarthos
    Participant
    Homeric

    ..and today the more leftish of the Syriza party are reportedly non too happy! (source BBC News).

    Do you still think reverting to the Drachma is still a good idea KP?

  • #194146

    kiwi
    Participant
    Aristotelic

    Ya can’t please all of the people all of the tme kolly. My bet is that Greece will never go back to Drachma. It would not be acceptable to the policemen of the world. A deal will be done, or…some dirt will be planted to get rid of the status quo. IMHO.

  • #194147

    KP
    Participant
    Aristotelic

    @kolofarthos wrote:

    ………. Do you still think reverting to the Drachma is still a good idea KP?

    With Syriza in control now, who knows what would be a good idea now?
    Whether they stay with the Euro or go back to the Drachma, I don’t think that either will make any difference as Syriza don’t intend to make any important changes to the economy as they’re more focussed on going back to a country of an over bloated civil service, government owning and running businesses at a loss, etc etc…..
    Doom, gloom, despair, despondancy……… we’re dooooomed, doooooooooomed, dooooooooooooooomed, I tell ye! reb_popo

  • #194148

    kiwi
    Participant
    Aristotelic

    Cmon kp. They have already bagged a few big tax dodgers. Give them a chance. I have faith in their youth and fresh ideas. I Also see that Cypriots are very much supportive of Tsipras.

    It ain’t over yet… http://www.zerohedge.com/news/2015-02-22/50-shades-greece

  • #194149

    kiwi
    Participant
    Aristotelic

    I had a snigger with this clip of the Germans laughing at themselves. Enjoy.

    http://www.zerohedge.com/news/2015-02-26/yanis-varoufakis-he-puts-hell-hellenic

  • #194150

    kiwi
    Participant
    Aristotelic
  • #194151

    jodevizes
    Participant
    Oracle

    There was a programme on the BBC where a guy suggested that Greece should be treated like Germany was after WW2 with the Marshal Plan and have their debt cancelled because they cannot get any growth as all their revenue was spent servicing the debt.

    Just waiting for the invoice to UK for renting the Elgin Marbles :)

  • #194152

    kiwi
    Participant
    Aristotelic
  • #194153

    kiwi
    Participant
    Aristotelic
  • #194154

    KP
    Participant
    Aristotelic

    Dare I suggest that there’s a silver lining in this, in that the GB pound is buying all of us an awful lot more Euro these days and it’s being forecast that this will continue to increase to as much as 1.5 Euro to the GBP?

    Great news for all of you lucky types with British pensions and savings in GBP…. if that forecast is right, you don’t want to be changing too many GBP too soon! :mrgreen:

  • #194155

    kiwi
    Participant
    Aristotelic

    Maybe right kp and nice for the expats, but Greece is being squarely blackmailed to do it Draghis way, by rewarding everyone but Greece and Cyprus with a bonus. So they print money and give to all the haves, while the have nots are being told to put their heads under and continue starving as they watch all the others around them being fed. And it’s all done with a great big smirk on that face that needs the ‘slap with a wet fish’ award.

  • #194156

    KP
    Participant
    Aristotelic

    @kiwi wrote:

    Maybe right kp and nice for the expats, but Greece is being squarely blackmailed to do it Draghis way, by rewarding everyone but Greece and Cyprus with a bonus. So they print money and give to all the haves, while the have nots are being told to put their heads under and continue starving as they watch all the others around them being fed. And it’s all done with a great big smirk on that face that needs the ‘slap with a wet fish’ award.

    Come on kiwi…. It’s a bit late for Greece to play the hard done by victim! I think they’ve rather overdone that scenario already!
    So they’ve borrowed and been given so much already on the basis of an agreement to address certain things which definatly needed addressing in order to ensure that they don’t keep needing bailouts and they’ve not only renaged on what was agreed, but now the new government is rubbing the lenders noses in it, by insisting that they have no intention of doing what is required, but still expect more money!!!??? :O

  • #194157

    kolofarthos
    Participant
    Homeric

    I suspect that, whatever the reason for the current situation as you have so eloquently put it KP, Kiwi feels for the normal ‘man in the street’ and children who are suffering the worst of the fallout. Those to blame are surely mainly those with the power and the ordinary folk who, through ignorance, greed or lack of understanding condoned and aided poor practice over the years irrespective of nationality or country of residence.

    Up the revolution brothers!…well lets hope not literally but certainly peacefully.

  • #194158

    kiwi
    Participant
    Aristotelic

    Agreed, they were given a lot of money…that went to the banks and the foreign banks, not the people. As the IMF guy said in the above link, French and German banks were bailed.

  • #194159

    kiwi
    Participant
    Aristotelic
  • #194160

    kiwi
    Participant
    Aristotelic
  • #194161

    KP
    Participant
    Aristotelic

    a couple of fun packed ariticles there kiwi my girl! :))

    So the only way which Greece can continue to be supported is through fear of the EU that if Greece goes down, then the whole pack of cards will begin to go down and floods of Al Qaeda types will flood Europe! :mrgreen:

    Hey, but at least meanwhile all the British ex-pats can get jobs as VAT spies for the Greek government and make some money! In line with the normal Greek tax inspectors, you’ll be able to make a lot more money on the side by taking lots of fakelakia from those businesses you find avoiding tax and threatening to report them if they don’t pay up? :unibrow:

  • #194162

    Shazzie
    Participant
    Oracle

    Agreed, they were given a lot of money…that went to the banks and the foreign banks, not the people. As the IMF guy said in the above link, French and German banks were bailed.

    Totally right Kiwi, if Greece got to keep 2/3rds of the money they’d be laughing now (in happiness not on the verge of a nervous breakdown hysterically !)

  • #194163

    Sancho the Fat
    Participant
    Neophyte

    If anyone’s interested, here’s the article in the FT that first revealed this offer, if that’s what it was –

    March 6, 2015 6:15 pm

    Greece proposes tourists as tax inspectors

    Peter Spiegel in Brussels

    Greece has proposed recruiting students, housekeepers, and even tourists to serve as undercover tax inspectors, one of a batch of economic reforms intended to unlock €7.2bn in rescue aid.

    In a letter to eurozone authorities, the cash-strapped Greek government suggested that Athens could fight widespread evasion of value added tax by wiring “non-professional inspectors” with audio and video equipment to track down lawbreakers.

    In addition to students and housekeepers, Yanis Varoufakis, the Greek finance minister, suggested that “even tourists in popular areas ripe with tax evasion” could be part of the scheme. They could be paid an hourly rate “on a strictly short-term, casual basis” for no more than two months.

    “The very ‘news’ that thousands of casual ‘onlookers’ are everywhere, bearing audio and video recording equipment on behalf of the tax authorities, has the capacity to shift attitudes very quickly,” wrote Mr Varoufakis in the 11-page letter, sent on Thursday to Jeroen Dijsselbloem, the eurozone’s chief negotiator, and obtained by the Financial Times.

    The letter was sent ahead of Monday’s meeting of eurozone finance ministers and includes more traditional economic reforms, such as an independent “fiscal council” to monitor the government’s spending and plans for collecting unpaid taxes.

    But the reaction from eurozone officials to the undercover tourist plan — one said staff laughed out loud when they read the proposal — is the latest evidence of the growing gap between the Greek government and its international bailout lenders, at a time when Athens could be less than two weeks away from running out of cash completely.

    “It’s quite hilarious, if it were not so tragic, that this is what a government in an industrialised country comes up with,” said one eurozone official involved in the talks.

    Eurozone officials were forced to call off a visit by bailout inspectors to Athens planned for next week after Greek authorities objected that such a trip would appear similar to previous audits by the “troika” — the widely hated trio of creditor institutions the new government has vowed to do away with.

    Mr Dijsselbleom has suggested that a small part of the €7.2bn in remaining bailout cash could be distributed to Athens quickly if the government immediately adopts reforms that creditors have been calling for. Some Greek officials had hoped the letter – which Mr Varoufakis characterised as “the first of a batch of reforms” — could be the starting point for such talks.

    But eurozone officials said such discussions were premature since the troika — European Commission, European Central Bank and International Monetary Fund – have yet to pore over Greece’s books in order to find out how deep the country’s fiscal hole has become since the financial chaos unleashed by three months of political turmoil.

    “The eurogroup is not in a position to have a discussion of such measures if they have not been discussed by the three institutions,” said a senior EU official directly involved in talks with Athens. “PhDs abound [among finance ministers] but they don’t have the time to go through the laborious evaluation process — nor is it their job. That’s why you have the three institutions.”

    Some eurozone officials believe Greece may run out of cash in less than two weeks. One official said there was already evidence that the central government was accessing reserve funds held by independent agencies in order to pay its bills.

    “The situation is breaking down again and the possibility of a cash crunch is real,” said Mujtaba Rahman, head of European analysis at the Eurasia Group risk consultancy. “The Greeks’ proposed reforms aren’t going to be taken seriously by the eurogroup.”

    Alexis Tsipras, the Greek prime minister, warned that without a quick influx of cash, “it will be back to the thriller we saw before February 20,” a reference to high-stakes brinkmanship before a deal to extend Greece’s bailout was agreed last month.

    In an interview with the German magazine Der Spiegel, Mr Tsipras said it was up to the ECB to provide the emergency funding by lifting a ceiling on the amount of short-term debt Athens can issue. “The ECB has still got a rope round our neck,” he said.

    But on Thursday, Mario Draghi, the ECB chief, said the central bank’s rules prevented it from lifting the limit.

    http://www.ft.com/cms/s/0/b65fa81c-c411-11e4-a02e-00144feab7de.html#axzz3Tlgtq6FV

    P.S. Here’s the actual letter – http://www.ilsole24ore.com/pdf2010/Editrice/ILSOLE24ORE/ILSOLE24ORE/Online/_Oggetti_Correlati/Documenti/Notizie/2015/03/lettera%20grecia.pdf

  • #194164

    kiwi
    Participant
    Aristotelic

    http://www.zerohedge.com/news/2015-03-09/why-greek-shipping-billionaires-are-sweating

    Maybe the older Greek magnates like Onassis had a more social conscience. When we were in Nidri in summer, the older locals all told us how much Onassis helped them all and especially the village. He is their hero. His legacy goes on via the trusts, building public facilities that all people can share, and providing funds for many charities. Probably he knew that if he paid taxes to the then Governments the money would go down a black hole and it was his way of giving some back. Anyway, it’s no difficulty for ships to change the Greek flags to Liberian or Panama etc to avoid paying.

  • #194165

    kiwi
    Participant
    Aristotelic
  • #194166

    Sancho the Fat
    Participant
    Neophyte

    @kiwi wrote:

    http://www.zerohedge.com/news/2015-03-09/former-greek-finmin-admits-hiding-750k-overseas-afraid-country-would-collapse

    So what’s this “well-known Belgian beer” ? The only well-known Belgian beer I can think of off the top of my head is Stella Artois, and that’s never been common in Greece. Amstel’s Dutch. Ditto prasini. (They’re both both produced under licence in Greece – you can stock up with the original prasini on the ferry from Italy.) Mythos is made by Carlsberg, which is Danish….

  • #194167

    Sancho the Fat
    Participant
    Neophyte

    @kiwi wrote:

    http://www.zerohedge.com/news/2015-03-09/why-greek-shipping-billionaires-are-sweating

    Maybe the older Greek magnates like Onassis had a more social conscience. When we were in Nidri in summer, the older locals all told us how much Onassis helped them all and especially the village. He is their hero. His legacy goes on via the trusts, building public facilities that all people can share, and providing funds for many charities. Probably he knew that if he paid taxes to the then Governments the money would go down a black hole and it was his way of giving some back. Anyway, it’s no difficulty for ships to change the Greek flags to Liberian or Panama etc to avoid paying.

    http://en.wikipedia.org/wiki/George_Averoff

    (I’ve heard the rationale for the special tax-arrangements for Greek shipping companies is that the money isn’t earned in Greece, which should ring a bell with expats!)

  • #194168

    Ian
    Participant
    Homeric

    @Sancho the Fat wrote:

    @kiwi wrote:
    http://www.zerohedge.com/news/2015-03-09/why-greek-shipping-billionaires-are-sweating

    Maybe the older Greek magnates like Onassis had a more social conscience. When we were in Nidri in summer, the older locals all told us how much Onassis helped them all and especially the village. He is their hero. His legacy goes on via the trusts, building public facilities that all people can share, and providing funds for many charities. Probably he knew that if he paid taxes to the then Governments the money would go down a black hole and it was his way of giving some back. Anyway, it’s no difficulty for ships to change the Greek flags to Liberian or Panama etc to avoid paying.

    http://en.wikipedia.org/wiki/George_Averoff

    (I’ve heard the rationale for the special tax-arrangements for Greek shipping companies is that the money isn’t earned in Greece, which should ring a bell with expats!)

    Wonder why the same rationale is not applicable for offshore workers… 👿

  • #194169

    kiwi
    Participant
    Aristotelic

    I guess it’s because you live more than six months in Greece? I always wonder how come there are countries that are tax free and life still goes on?

  • #194170

    Sancho the Fat
    Participant
    Neophyte
  • #194171

    kiwi
    Participant
    Aristotelic

    http://www.zerohedge.com/news/2015-03-18/greek-bank-deposit-outflows-spike-liquidity-fear-spreads

    Personally I think it’s all just scare tactics and they won’t let the South East Med have the chance to fall into ‘other’ helping hands. Nerve racking though.

  • #194172

    jodevizes
    Participant
    Oracle

    Given the sanctions being imposed, perhaps Russia is looking for Greece to help them out. :)

  • #194173

    kolofarthos
    Participant
    Homeric

    It could be costly for Russia to bail out Greece (just like it has been/is for the EU etc. but I would suggest that Putin would be more than happy to pay even a heavy price to get a military base in Greece……in a similar manner he was keen on a base in Cyprus.

    That would not go down well in the EU or NATO hence a great bargaining chip for Alexis. Not without it’s dangers though, but when push comes to shove…….

    I am reminded of the apparent huge investments by Russians I perceived on my last holiday on Thassos. Not always the sort of development welcomed, consider the Costa Navarino type that is not to everyone’s liking but probably brings much needed business overall.

    I note today that the Minoan group (a Scottish based travel firm) have now been approved by the Judges to get their proposed development on Crete passed back to the Presidential office for ratification (the draft presidential decree) , about the final step in the planning process if I understand correctly. Minoan’s take on the project at Cavo Sidero can be seen here http://www.minoangroup.com/crete/ but environmentalists are not happy. I’m sure tourism could be extended without large scale development if only Greeks got out of the ‘summer’ mindset.

    I can well see the draw of tourism but I believe that Greece needs to diversify more too and find other sources of foreign income and also reduce costs. Ideas anyone?

  • #194174

    altohb
    Participant
    Hoplite

    The Cavo Sidero project is extremely contentious – not just among environmentalists, but those (like me) who feel that further development of “all in” holiday resorts is just what Greece does not need. In this particular instance, too, because of the distance of the proposed development from “anywhere” it doesn’t look as if local businesses or workers will benefit much, if at all. The proposed site is stunningly beautiful, and in the middle of nowhere. The implications for the water infrastructure if nothing else make me very worried. This is arid landscape which will need huge amounts of water if a golf course is to be built, let alone the needs of the rest of the resort.

  • #194175

    kiwi
    Participant
    Aristotelic

    The problem with these all in one holiday places is that the tourists pay for the entire holiday in THEIR country. What does Greece make from that type of tourist? They are usually the low income young crowd who haven’t any other funds so they stay in the resort to spend what little money they bring, hence the reason they are usually in remote areas away from local amenities.

    At least with Costa Navarino etc, the bigger money tourists can afford to get out, use local amenities, cars, restaurants, boats etc and they may also move to other parts of the country and spend.

    This is one of the reasons I like staying at smaller family hotels and guest houses because this way I support the economy.

    As for the Russians. Sanctions only bring out ire and determination. Necessity is the mother of invention and of course Greece is an opportunity they would pounce upon. A fact not unnoticed by the U.S. who are not amused at the ‘let’s see who blinks first’ game Europe is playing. China awaits quietly in the wings.

  • #194176

    kiwi
    Participant
    Aristotelic
  • #194177

    kiwi
    Participant
    Aristotelic

    http://www.zerohedge.com/news/2015-03-28/greek-minister-slams-unscrupulous-imperialist-germany-will-seek-bold-alternatives-ru

    Meetings this week with Russia but not to ask for money…both sides are still holding to see who blinks first.

  • #194178

    kiwi
    Participant
    Aristotelic
  • #194179

    KP
    Participant
    Aristotelic

    @kiwi wrote:

    Found this interesting article. http://goldsurvivalguide.co.nz/letter-alexis-tsipras-hugo-salinas-price/

    Excellent…. what a wonderful new idea! I can already see a number of wonderful ways of abusing this system to make money out of it! :mrgreen: Bring it on! …… new opportunities for the further development of ‘Pauper’s Bank Inc.’ at the cost of the great unwashed masses of Greece! 😈
    Had I but known that being a socialist could be so profitable I’d have made the transition years ago! Long live the revoloution brothers (and even sisters)! :nod:

  • #194180

    kiwi
    Participant
    Aristotelic
  • #194181

    kolofarthos
    Participant
    Homeric

    It may be your best source of news Kiwi but that web site really is awfull – not just the poor very biased journalism but also the condoning of the crass and insulting comments it does not moderate……..

    Even the DM looks good by comparison……so I am informed! ic_wink

  • #194182

    kiwi
    Participant
    Aristotelic

    I agree that the comments can be a bit rough at times, but at this ripe old age, it’s all been heard before. It’s mostly traders and those in finance commenting, but you often get to hear about interesting stuff before it hits mainstream and there are some pretty tuned up types in there that offer other links which can be interesting. At the bottom of each article, note the numbers of reads…thousands.

    There is a cautionary note in the site warning people that content could offend.

    I think bias is a judgement made when the content is of an opposing view to ones own.
    Hehe…I see poor journalism doesn’t stop you reading DM though.

  • #194183

    kolofarthos
    Participant
    Homeric

    It’s well past your bedtime girl! :))

    I actually do not read the DM as a rule but I think it is biased, sometimes see one and cannot believe all the rubish that is written and whether I agree with any of the comments or not it it obviously biased as it is often very selective of stats such as on immigration. I could say the same of many a newspaper or
    online site.

    Bias I judge not from my own opinion or views but looking at ‘facts’ reported and the fact that the reporting is skewed to particular opinions rather than the norm. I do accept that ones own opinion does affect judgement though……..perhaps I react to the comments!

    However you value the site for it’s inside/early reporting? Just looked again at your last link and then also at an earlier link to see if they broke new ground. Well the former was reported on other sites earlier and comprised many quotations and the latter was based on Ekathimerini reports, so it said, so really just copy and old news! :nod:

  • #194184

    kiwi
    Participant
    Aristotelic

    Ahh well, maybe I’m just a dummy with no literary taste. I apologise to all that have silently endured, and won’t post from there again.

    I stopped reading DM a long time ago and have learned to make my own value judgements on news reported in mainstream. Zerohedge does report using a lot of the foreign press reports which are unavailable to English readers because they can’t speak German or Greek, or Spanish etc. it’s a news aggregator of sorts.

    I look forward to lots of news from more politically correct sources from you and kp in future.

  • #194185

    kolofarthos
    Participant
    Homeric

    Hey Kiwi, don’t stop the posting (readers must decide for themselves to use the links or not), I do not imply you are a dummy etc. and no apologies are needed. Just as much as I feel I can post my thoughts about zero hedge you should be able to keep us informed with your posts. Life would be boring if we all agreed and we should be able to debate, should we not?

    Zero hedge being an aggregator – I can stand that – but many of the comments posted below their articles, on reflection, is probably the issue for me so I don’t need to read them do I?

  • #194186

    kiwi
    Participant
    Aristotelic

    Unfortunately on freer less mainstream websites there are always the foul mouthed who abuse their freedom of making a point without crudeness they would probably never use were they unmasked or in front of their family. Anonymity has its good and bad side. Zerohedge has a huge following worldwide so I guess you can’t please all of the people all of the time.

  • #194187

    Ian
    Participant
    Homeric

    @kolofarthos wrote:

    Bias I judge not from my own opinion or views but looking at ‘facts’ reported and the fact that the reporting is skewed to particular opinions rather than the norm. I do accept that ones own opinion does affect judgement though……..perhaps I react to the comments!

    Well, you all know what they say about opinions:

    Opinions are like assholes, everybody has one and most of them stink. :roll:

    Other than that, I think objectivity is an illusion.

  • #194188

    KP
    Participant
    Aristotelic

    @Ian wrote:

    Opinions are like assholes, everybody has one and most of them stink. :roll:

    How do you know that most of them stink? :roll: Have you undertaken research and gone around getting people to drop their pants so that you can stick your nose by their asses to sniff? 😯

    Oh, hang on, I forgot…. you’re Dutch! Of course….. :mrgreen:

  • #194189

    kolofarthos
    Participant
    Homeric

    Ha, good observation Ian! (In my humble opinion….)

    Come now KP what has nationality got to do with it? Hang on you cannot be saying the Dutch are not objective, can you? reb_bravo ic_wink 😆

  • #194190

    kiwi
    Participant
    Aristotelic

    Part of the Memorandum I did not know about…

    Will Greece Lose Its Gold Again

    When it comes to the topic of Greece, most pundits focus on two items: i) when will Greece finally run out of confiscated cash, and ii) will Greece fold to the Troika (and agree to another bailout(s) with even more austerity) or to Russia (and agree to the passage of the Russian Turkish Stream pipeline, potentially exiting NATO and becoming the most important European satellite of the USSR 2.0) once that moment arrives.

    And yet what everyone appears to be forgetting is a nuanced clause buried deep in the term sheet of the second Greek bailout: a bailout whose terms will be ultimately reneged upon if and when Greece defaults on its debt to the Troika (either in or out of the Eurozone). Recall that as per our report from February 2012, in addition to losing its sovereignty years ago, Greece also lost something far more important. It’s gold:

    To wit:

    Ms. Katseli, an economist who was labor minister in the government of George Papandreou until she left in a cabinet reshuffle last June, was also upset that Greece’s lenders will have the right to seize the gold reserves in the Bank of Greece under the terms of the new deal.
    The “new deal”referred to is the Second Greek Bailout, which either will be extended and lead to a third (and fourth, and fifth bailout, each with every more draconian terms until finally Greece does default), or will collapse at which point the Troika will indeed have the right to seize the Greek gold reserves.

    What makes this case particularly curious, however, is that it won’t be the first time Greece will have “lost” its gold. In The Tower of Basel, citing the BIS archive from Febriary 9, 1931, Adam LeBor writes:

    In February 1931, Gates McGarrah, the [BIS’s] American president, wrote to H. C. F. Finlayson, in Athens, asking about the Bank of Greece’s gold. Finlayson, a former British financial attaché in Berlin, was now an adviser to the Bank of Greece. Some of the Greek bank’s gold may have gone missing. Rather like nowadays, it seemed the accounting at the Bank of Greece left something to be desired. “What has ever happened to the gold of the Bank of Greece, some of which you thought might be left in our custody in Paris or elsewhere?” inquired McGarrah, who, as the president of the BIS might have been expected to know what it held and where. It might, McGarrah suggested, be a good time to find the Greek gold and place it with the BIS.

    The BIS, wrote McGarrah, could give the Bank of Greece “all sorts of facilities, rather greater than those of a local Central Bank.” For example, if the Bank of Greece held gold at the Bank of France and wanted to buy another currency, it first had to buy francs from the Bank of France. The Bank of Greece then converted the francs to the second currency, with all the usual losses of exchange rates and commissions. However, if the Bank of Greece held gold at the Bank of France in the name of the BIS, the BIS could “give the Bank of Greece any currency it desires at any time and can fix an agreed rate without going through the actual exchange operation.” And, the BIS did not charge any commission.
    And all Greece would need to do to get these copious and generous “benefits”would be to hand over its gold to the Bank of International Settlements. Of course, it would have to find it first…

    But most importantly, and what ties everything together is that other historic event which took place in 1931.

    For those who may not be gold history buffs, this is what happened: in September of that year the Bank of England decided to formally (and for the final time) abandon the gold standard. And, as the chart below first posted on Zero Hedge many years ago, that decision, coupled with the great depression and the loss of confidence in the pound, ultimately ended the reserve status of the British currency, ushering the reserve currency status of the US Dollar.

    A few months ago, when the Minutes from the Bank of England’s court were published for the first time in January, we learned precisely what happened months after the BIS casually inquired about the lost Greek gold. The Telegraph summarized it as follows:

    At the time, sterling was pegged to bullion. This meant that the pound was worth a fixed amount compared to other currencies and gold itself. In order to ensure that sterling retained its value, the Bank of England was obligated to exchange gold for pounds at the specified rate.

    However, as political turmoil engulfed the UK, the country’s first national government – a coalition between Labour and the Conservatives – presided over a budget crisis that triggered a run on the pound.

    Minutes from the Bank’s court in 1931, published on Wednesday, detailed how foreign exchange reserves were being drained to such an extent that the gold standard had to be abandoned.

    Up to that point, the gold standard had been preserved by loans from the Federal Reserve and the French central bank, with the Bank’s bullion reserves used as collateral. But Threadneedle Street decided in September that its reserves would run dry if New York and Paris withdrew support. Ernest Harvey, the Bank’s deputy governor at the time, wrote to Ramsay MacDonald, the prime minister, and Philip Snowden, the chancellor, on September 19, 1931, saying that reserves worth more than £100m were close to running out.

    Mr Harvey wrote: “I am directed to state that the credits for $125,000,000 and Fcs 3,100,000,000 arranged by the Bank of England in New York and Paris respectively, are exhausted, and that the credit for $200,000,000 arranged in New York by His Majesty’s Government, together with credits for a total of Fcs 5 milliards [5bn] negotiated in Paris, are practically exhausted also.” “The heavy demands for exchange on New York and Paris still continue. In addition the Bank are being subjected to a drain of gold for Holland.

    “Under these circumstances, the Bank consider that, having regard to the above commitments and to contingencies that may arise, it would be impossible for them to meet the demands for gold with which they would be faced on withdrawal of support from the New York and Paris exchanges.

    “The Bank therefore feel it their duty to represent that, in their opinion, it is expedient in the national interest that they should be relieved of their obligation to sell gold under the provisions of [the Gold Standard Act 1925].”
    In other words, the Bank of England became insolvent in hard money terms, and was forced to back the currency with nothing but its “faith and credit.” No wonder at that moment the sun had set on the British Pound.

    40 years later, Nixon finally did the same with the US Dollar (but not before FDR confiscated all gold as the US also devalued its currency by 40% in “hard money terms” on January 30, 1934 with the Gold Reserve Act), but in the absence of any gold-backed currency to arise (oh, hi Beijing), the dollar still remains the one-eyed king in the land of blind fiat.

    Still, one wonders: the last time Greek gold was “lost” a historic event for the world’s reserve currencie took place. Is Greek gold about to be “lost” once more, and will monetary history rhyme?

  • #194191

    kiwi
    Participant
    Aristotelic

    http://www.zerohedge.com/news/2015-05-05/greek-deal-limbo-after-serious-disagreement-between-eu-imf

    The comedy will continue…they will lend Greece money so Greece can pay it right back as an interest payment that is due. Imagine if your bank loaned you the money every month to make your mortgage payments to them…not in a million years.

  • #194192

    kolofarthos
    Participant
    Homeric

    Ah yes robbing Peter to pay…..somebody else (certainly not Paul!!)….. ic_wink

    …and Varoufakis says good progress needs to be solidified!

    The only thing apparently progressing is time.

  • #194193

    kiwi
    Participant
    Aristotelic
  • #194194

    kiwi
    Participant
    Aristotelic

    Prime Ministers message to the people Sunday night with English subtitles

    http://youtu.be/NhFxwsrqTdI

  • #194195

    kiwi
    Participant
    Aristotelic

    Zerohedge is worth a read today. Too much happening to post separate links. Certainly the markets seem to be haemorrhaging worldwide.

    http://www.zerohedge.com

  • #194196

    kiwi
    Participant
    Aristotelic
  • #194197

    kiwi
    Participant
    Aristotelic
  • #194198

    kiwi
    Participant
    Aristotelic
  • #212224

    kiwi
    Participant
    Aristotelic

    I think I just posted a link….let’s see if it shows up. nope, try again.

    • This reply was modified 1 year, 10 months ago by  kiwi.
    • This reply was modified 1 year, 10 months ago by  kiwi.
  • #212227

    kiwi
    Participant
    Aristotelic

    Someone tell me how to paste a link! I can’t figure it out, convoluted, make it simple please. Here it is http://www.zerohedge.com/news/2015-08-14/greeks-flock-grassroots-alternative-currencies-affront-euro-debt-slavery

     

    Hmmm. It accidently worked…

    • This reply was modified 1 year, 10 months ago by  kiwi.
  • #212445

    jodevizes
    Participant
    Oracle

    Hi Kiwi, I had the same problem but found that if you put in ‘here’ or ‘read this’. highlight it and go to the bar just above the text and click on the 11th thingy that looks a bit like a paperclip. This brings up a window which shows you the text that is clickable and a box to paste your link in and voila.

    Hope this helps.

  • #212548

    kolofarthos
    Participant
    Homeric

    Well I have done it but find it difficult to do it after typing, inserting a link (fine) but then I seem to have no method to continue typing…..so I would appreciate a blow by blow procedure too!

    • This reply was modified 1 year, 10 months ago by  kolofarthos.
  • #212550

    kolofarthos
    Participant
    Homeric
  • #212552

    kiwi
    Participant
    Aristotelic

    It used to be insert the link and click…argh! Why don’t things become easier. I got the link in by accident. I dread to try again. Maybe we should be trying it all out in the test bed.

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