Maybe this will fix Greece

hoops so are you saying Greece is never going to borrow money again? I doubt that.

Sybil said:
hoops so are you saying Greece is never going to borrow money again? I doubt that.

of course not, i'm saying that austerity policies are devastating the population of Greece.

1. There are no circumstances under which Greece will be able to repay the debt.

2. Europe doesn't really need a collapsed state on the Continent. If they think the flow of war and economic refugees across the Med is a problem now, imagine what happens if Greece collapses.

3. All solutions are going to be very painful for the Greek people. Find the solution that minimizes the duration of the pain - kind of like war where the most humane thing to do is make it as fast as possible.

So, I know all of the arguments about moral hazard and Spain, Italy and Portugal, but it seems like it would be expedient to suspend collection of the debts, resurrect the drachma and let Greece figure things out for themselves.

hoops said:

Sybil said:
hoops so are you saying Greece is never going to borrow money again? I doubt that.

of course not, i'm saying that austerity policies are devastating the population of Greece.

So they will not "not be beholden to foreigner banks"

Hoops,

The Greeks are going to suffer no matter what. The trick is to find the least painful of a range of unpleasant solutions.

The new pain they are feeling in 2015 is totally self inflicted. This is not a murder. It is a suicide.

tjohn said:
Hoops,
The Greeks are going to suffer no matter what. The trick is to find the least painful of a range of unpleasant solutions.

The point is that they have already suffered mightily and continue to do so. what they need now is relief not further punishment.

I am getting projections that if they leave the EU and strike out on their own they will be able in a few years to lower the unemployment rate from 27 per cent to about 7.

That a few EU members who are only a hop skip and a jump away from their position will be watching with interest. That the last thing General Merkel would want to see is a successful , independent Greece.

Also a giant Horse was spotted being assembled on a hidden away beach.

What is good for the goose is not always good for the gander........but in this case the goose

continues to goose step

http://www.vox.com/2015/6/30/8868973/euro-greece-crisis-mistake

author said:
I am getting projections that if they leave the EU and strike out on their own they will be able in a few years to lower the unemployment rate from 27 per cent to about 7.

Has Greek unemployment ever been at 7%? The record low was 7.3% back in 2008.

author said:
What is good for the goose is not always good for the gander........but in this case the goose
continues to goose step


http://www.vox.com/2015/6/30/8868973/euro-greece-crisis-mistake

Nice. Continuing with the Nazi references that may play way among Greeks but nobody else.

If you strip away some of the silliness from libertarian philosophy, it's actually a pretty conventional take on economics (albeit one I disagree with). Their big bugaboos are central banks and fiat money.

The "advantage" of gold is that it's relatively rare, which limits the money supply. And the problem with central banks is that, even if you use a naturally limited currency like gold, a central bank can still game the system to get around that if they want to.

So all this really means is a "hard-money" policy - inflation is to be avoided at all costs and value of money kept high. You can of course have a hard money policy with fiat currency and central banks, but a libertarian economy tries to go beyond merely encouraging hard money policies and actually make deviating from "hard money" impossible.

In practice, what this means is an economic policy that always privileges creditors (those who have money) over borrowers.

Setting aside all the window-dressing about gold and central banks, then, is a hard money policy appropriate for Greece's current situation?

I don't pretend to know. I'll list a few things that would make me uneasy about it though, if I were either Greece or one of its European partners:

- An inflexible commitment to a single type of monetary policy, always and in all situations, seems problematic. Giving countries the power to influence the value of their currency means they can make mistakes (as arguably we are seeing happening right now), but I'm not sure the solution is to make it impossible for governments to respond to different economic conditions

- I'm not convinced creditors' interests should always take precedence. If it's the difference between a banker in Frankfurt forgoing a bonus or an entire country suffering 25% unemployment, it's not clear to me why creditors must be protected at all costs.

- OTOH, I don't fully understand what Greece's hoped-for outcome is. Clearly they have some major issues - rampant tax evasion, generous pensions that no one seems to actually want to pay for, etc. They have undergone a lot of suffering, and likely have much more to come, but I do see the point of Germany and the other Eurozone countries in that they'd like to see clear commitments to structural reforms to the Greek economy.

So I have my doubts that a prioritizing creditors above all, as Germany (and as superficially non-mainstream philosophies such as libertarianism) advocate. But I can't actually say I have a good idea of what Greece or the Eurozone should actually do.

tjohn said:

Sybil said:
Greece has been intransigent. Greece has gotten lots of help but has pissed it all away. Growth was returning at the beginning of the year. Like all addicts, Greece can not be helped until it accepts it needs to change its ways.

Or you could hold lenders accountable for making bad loans. Addicts need enablers. Hold the enablers equally responsible.

Their accountability is their balance sheet.

Sybil said:
hoops so are you saying Greece is never going to borrow money again? I doubt that.

Depends on whether anyone will loan it to them, not whether or not they want to borrow.

And FWIW I'm not sure what author or anyone else is hearing about EU departure and the good that might ultimatelycome out of it, but the general consensus I'm hearing is that they will and it will be horrific for them.

Edit for my previous comment -- I'm not sure if "hard money" is actually the correct term. I thought it meant a policy that seeks to limit the amount of money in circulation, but I'm not an economist so just wanted to point out I may have the terminology wrong.

PVW said:
Edit for my previous comment -- I'm not sure if "hard money" is actually the correct term. I thought it meant a policy that seeks to limit the amount of money in circulation, but I'm not an economist so just wanted to point out I may have the terminology wrong.

Why should the amount of money in circulation be dependent on how much gold has been mined?

Trees are turned into houses. Silicon is turned into computer memory. Iron is turned into machinery. Sunlight is turned into electricity. As the net wealth of the world is increased as raw materials are being turned into tangible assets, what's gold got to do with it?

ctrzaska said:
And FWIW I'm not sure what author or anyone else is hearing about EU departure and the good that might ultimatelycome out of it, but the general consensus I'm hearing is that they will and it will be horrific for them.

It was not that long ago when the Euro or the EU had little to do with Greece. And then the golden apple was made possible and they did what they thought necessary to obtain it.

History has shown that to be a major, major error. Compare their economic numbers of 2002 with today.

Apples and apples.............you can get any more precise. When Greece leaves the EU......................

The predictions....... roughly a 20 per cent loss in the value of the Drachma........with all attending indicators sliding also.

But then slowly, slowly a turn around . Within 5 years the rate of unemployment will drop from the current 27 per cent to 5.

Other European states that show horrendous numbers and nothing but debt to the EU will take notice.

Merkel and or her successor will start to wonder in what direction to go. Where do you loan monies after it has been proven not only the solution but the crux of the problem.

Within not that many years later the dissolution of the EU.............or one very much reduced in size and

barely a player on the world stage.

More and more countries are moving in the direction of integration and customs unions. The Eurozone was just taking that concept to it's end state. There are good reasons why countries are doing this (e.g trade advantages). To think that the developed nations of Europe will give up on the Eurozone is silly. Sure, Spain, Portugal and Greece might leave, but those parts of Europe not corrupted by ancient Roman influences will make it work and will be richer for doing so.

tjohn said:
More and more countries are moving in the direction of integration and customs unions. The Eurozone was just taking that concept to it's end state. There are good reasons why countries are doing this (e.g trade advantages). To think that the developed nations of Europe will give up on the Eurozone is silly. Sure, Spain, Portugal and Greece might leave, but those parts of Europe not corrupted by ancient Roman influences will make it work and will be richer for doing so.

Interesting comment given the fact that there is a strong movement within England to quit the EU and they never did adopt the Euro.

Maybe those were pretend Romans running around the country side for so long.

As an aside, how does one separate ancient Roman influences from every other aspect of a culture at this point in history?

A lot of leaders in Europe understand that a united Europe with a single currency can be a more competitive economic entity than a Europe of completely independent nations. Now, I suppose it is possible that they underestimated the challenges of forming a union, but I think their assessment of the benefits was correct.

So, maybe the Eurozone sheds a few countries along the way, but I would expect that France, Germany and other Northern European countries will stick together.

author said:

ctrzaska said:
And FWIW I'm not sure what author or anyone else is hearing about EU departure and the good that might ultimatelycome out of it, but the general consensus I'm hearing is that they will and it will be horrific for them.

It was not that long ago when the Euro or the EU had little to do with Greece. And then the golden apple was made possible and they did what they thought necessary to obtain it.
History has shown that to be a major, major error. Compare their economic numbers of 2002 with today.
Apples and apples.............you can get any more precise. When Greece leaves the EU......................
The predictions....... roughly a 20 per cent loss in the value of the Drachma........with all attending indicators sliding also.
But then slowly, slowly a turn around . Within 5 years the rate of unemployment will drop from the current 27 per cent to 5.
Other European states that show horrendous numbers and nothing but debt to the EU will take notice.
Merkel and or her successor will start to wonder in what direction to go. Where do you loan monies after it has been proven not only the solution but the crux of the problem.
Within not that many years later the dissolution of the EU.............or one very much reduced in size and
barely a player on the world stage.

I'm hearing up to about 40% devaluation depending on circumstances. And you forget the impact of inevitable inflation and cannot count on the solvency of banks as yet. How you arrive at such a record-breakingly steep drop in unemployment is beyond me given the OECD's conservative projections, those of the IMF, EY's latest analysis, etc etc. Average Eurozone rate is about 9.5%, and you've got Greece nearly tripling that with the <25 sector over 50%. FIFTY. This crowd is the most troubling as they would form the backbone of any long-term recovery I would assume, unless of course the aged continue to edge them out to recover lost pensions soon to be hugely cut (if they happen to stay in the EU), and they simply leave. Where 5% factors in just doesn't compute.

And banks are closed till Minday.

tom said:
As an aside, how does one separate ancient Roman influences from every other aspect of a culture at this point in history?

You don't.

author said:
The predictions....... roughly a 20 per cent loss in the value of the Drachma........with all attending indicators sliding also.
But then slowly, slowly a turn around . Within 5 years the rate of unemployment will drop from the current 27 per cent to 5.

Since the record low unemployment number for Greece is over 7%, and just upthread you were predicting 7% unemployment, where is this 5% coming from? Unless someone intends to remove a large segment of the working population...

5% unemployment is a pipe dream.

Well I think that's it. Everyone between the ages of 10 and 25 leaves for Turkey and voila! Instant decrease.

Seriously author, I simply can't see it at ALL. The math just doesn't work.

ctrzaska said:

author said:

ctrzaska said:
And FWIW I'm not sure what author or anyone else is hearing about EU departure and the good that might ultimatelycome out of it, but the general consensus I'm hearing is that they will and it will be horrific for them.

It was not that long ago when the Euro or the EU had little to do with Greece. And then the golden apple was made possible and they did what they thought necessary to obtain it.
History has shown that to be a major, major error. Compare their economic numbers of 2002 with today.
Apples and apples.............you can get any more precise. When Greece leaves the EU......................
The predictions....... roughly a 20 per cent loss in the value of the Drachma........with all attending indicators sliding also.
But then slowly, slowly a turn around . Within 5 years the rate of unemployment will drop from the current 27 per cent to 5.
Other European states that show horrendous numbers and nothing but debt to the EU will take notice.
Merkel and or her successor will start to wonder in what direction to go. Where do you loan monies after it has been proven not only the solution but the crux of the problem.
Within not that many years later the dissolution of the EU.............or one very much reduced in size and
barely a player on the world stage.

I'm hearing up to about 40% devaluation depending on circumstances. And you forget the impact of inevitable inflation and cannot count on the solvency of banks as yet. How you arrive at such a record-breakingly steep drop in unemployment is beyond me given the OECD's conservative projections, those of the IMF, EY's latest analysis, etc etc. Average Eurozone rate is about 9.5%, and you've got Greece nearly tripling that with the <25 sector over 50%. FIFTY. This crowd is the most troubling as they would form the backbone of any long-term recovery I would assume, unless of course the aged continue to edge them out to recover lost pensions soon to be hugely cut (if they happen to stay in the EU), and they simply leave. Where 5% factors in just doesn't compute.

Someday I will learn to book mark my references. Hard to believe my daughter is sort of a scientist. She sure did not get her study habits from me Tomorrow I will get on it. Did not really did not want to do laundry anyway.

Inspired speech by Guy Verhofstadt

https://youtu.be/P84tN0z4jqM

From Robert Reich..........thank you Goldman Sachs

https://www.facebook.com/RBReich/photos/a.404595876219681.103599.142474049098533/1031196910226238/?type=1&theater