Just how much of a mess is Greece in, and what will happen?

[BeidAmmikon]

Now that's an overly pessimistic view of things.

They ain't that stupid.

Now that you mention it... The Euro can't really crash, because someone has to live off its manipulation.

[Rive]

...stuff...

We have a saying for that: what's buried many times will live longer...

The EUR is born because of the economical pressure. It will not break just because the pressure is increasing.

[RegisterMe]

Now that you mention it... The Euro can't really crash, because someone has to live off its manipulation.

I'm not sure what you mean, please would you explain / clarify?

Thanks,


RM

[BeidAmmikon]

Now that you mention it... The Euro can't really crash, because someone has to live off its manipulation.

I'm not sure what you mean, please would you explain / clarify?

I was thinking of banksters, such as these, and things like economic terrorism and currency manipulation. Throw in some Chomsky and you're set :)

[RegisterMe]

Banksters - did you read the article? Did you consider the opposing views? Or take into account "innocent until proven guilty"? Or perhaps that there might be more than the "obvious" agenda in play?

Economic terrorism - Here's the wikiepedia entry for him -

http://en.wikipedia.org/wiki/John_Perkins_(author)]John Perkins.

Note the "Controversy" section. Particularly the criticism from well respected newspapers and publications - The Wall Street Journal, The Economist, The New York Times etc.

Currency manipulation - emotive words to be sure, did you actually read the article? Did you understand it? I thought it was quite well written, and reasonably informative. Essentially all it said was "countries have been involved in manipulating the relative strengths of their currencies for years". Nothing more sinister than Japan selling the Yen to increase its export earnings or the Bundesbank believing in a strong Deutchesmark (or Euro, whatever).

Chomsky - an interesting character, and well respected for good reason, he has contributed massively to many areas of thought. He's also noted as a left-wing intellectual. There's nothing inherently wrong with that, but to quote a piece by him criticising (very loosely, nothing like that would ever get quoted by an Economics journal, or in a "hard science" journal) the capitalist system without providing context is disengenuous. Go look at the relavent pieces on Wikipedia.

Back to you Beid .

EDIT: Bah, multiple attempts to get the John Perkins link to work properly but I can't make it happen, too tired.......
EDIT 2: I did actually pick up Confessions of an Economic Hitman a year or so back. As you can imagine, it was close enough to a number of my interests to be "right up my street". Unforunately there was so much preposterous tinfoil hattery in it that I couldn't even finish it.

[BeidAmmikon]

Germany’s Parliament Votes to Give 66% of Country’s Annual Income Tax Revenue to Banks

"A German accountancy website allowing people to calculate what portion of their income tax will go to fund the banks reveals that a man earning 30,000 euros a year, and paying income tax of 5,625 euros, will be giving 3,709 euros to banks as part of the 123 billion eurozone “rescue” package.
He will be giving another 675 euros as part of the 22 billion euro Greek “rescue” package.
Germany spends another 40 billion a year paying interest on its national debts, which were created by the bank bailout and stimulus in the first place.
This means that another 1,200 euros of the 5,625 euros collected in income tax from a man earning 30,000 euros a years goes on interest payments on the national debt.
In this case, a total of 5584 euros or 99% in income tax is being paid directly to banks such as Deutsche Bank and Goldman Sachs by the German government in the form of interest payments on national and international eurozone debts.
As a result of this bill, only 41 euros of the total annual income tax of 5,625 could soon be available for the government to spend on education, pensions, hospitals and welfare and such like.
41 euros is 0.72% of the total income tax paid by a man earning 30,000 euros each year."

What can I say... Is a sad LOL good enough?

Here's another one (in German, for who can read it):
Wie Sie in die neue Weltordnung investieren (Die Welt, How to invest in the new World Order)
Oops, banned words! Conspiracy theory cliche spotted! World Order in the financial markets - stay calm and carry on. Google Translate says:
"Many experts consider the current weakness of the single currency is not a temporary phenomenon, but see this as the beginning of a new investment era. In the financial markets now a new world order is born."
And nobody will profit from the weakening of the Euro. Noo-body at all.

[RegisterMe]

Well, at least two of the three major ratings agencies have now downgraded Greek sovereign debt to junk status.

Because of investment rules (for instance those that are followed by pension funds) this effectively means that the only people who will invest in or trade the stuff are high yield, emerging market and junk debt funds.

Oh, and the ECB. Who I imagine are eating shovel loads of it at the moment in an attempt to keep yields down.

Fun fun fun. Not.

[BeidAmmikon]

Just in: Blast rocks Greek public order minister's office (AP)

[RegisterMe]

Ugly, as if burning a couple of people to death wasn't bad enough .

And really, really, really not going to help anybody at all.

[Dragoongfa]

Once again we have proof of the level of incompetence of our political and security 'elite'.

How the hell did someone manage to get a package from a courier (who wasn't even asked for his ID) to the 7th floor of the ministry of public order, without even having said package scanned with the bomb detection unit in place?

Incompetents.

[BeidAmmikon]

Incompetents.

Or infiltrators.

[RegisterMe]

True. But my money is on incompetance. Still regardless.

EDIT: As an aside, if you do really want to protect an important building, make sure some of the security guards are women. The number of times I've seen male security guards turn into gawping lumps of mush because a pretty girl (nice weather helps) walks past or asks them a question is beyond count.

Can't say I blame them though .

[Dragoongfa]

That would require a level of preparation and forethought impossible for Greek standards.

Incompetence to the level of high treason.

[imperium3]

Just in: Blast rocks Greek public order minister's office (AP)

Oh dear. Beware the Greeks bearing gifts....

[RegisterMe]

Slight thread necro here, but it's on topic and all of these stories are from today's Guardian. And anyway, this subject is likely to run for another five to ten years.....

Greek deficit larger than expected.

Ireland coming under pressure to accept a bailout because of fears of contagion on the part of Portugal and Spain.

In exchange for a bailout Ireland might come under pressure to change its corporate tax regime.

My take is that, whilst Eurostat's (etc) investigation of Greece's financials is disappointing, it's not entirely unexpected.

Similarly, with the additional 30-50 billion euros of capital needed by Irish banks, the fact that they are under renewed pressure makes sense (contrast with my earlier comments about how well received the actions Ireland took to tackle their problems were - before the extra bank black hole was understood).

What I think is interesting is that, in the abstract, this is Ireland saying "we've got enough cash to last us until at least the middle of next year, and we do not need a bailout", to be met with Portugal and Spain responding along the lines of "but the markets don't believe you and that's pushing our debt costs up, so we want you to take a bailout to take the pressure off us". Which neglects to mention that Portugal and Spain's short term funding position is actually worse than that of Ireland.

And the likes of Germany and France likely sitting there thinking "If Ireland has to take a bailout the least we can do is get them to normalise their corporate tax regime".

Which, to say the least, has interesting ramifications for those concerned about sovreignty.

[philip_hughes]

Australias retail figures are slowing. Interest rates are climbing. Whaddya reckon? GFC MkII?

[RegisterMe]

I only heard the term "GFC" (Great Financial Crash) yesterday, for the first time. Over here I think we talk about the Credit Crunch or the Great Recession (as opposed to Great Depression) instead.

Anyway, I suspect that the main thing Australia has to worry about is its housing market. I don't think, though, that you've added all the sub-prime / CDO2 complexities into play......

[BeidAmmikon]

My thoughts are with the Irish people, their country being given an ultimatum and generally speaking, being blackmailed into submission.
First, there were the referendums for joining the EU, that were repeated until the EU obtained the desired result. In the meantime, most of their poultry was killed off out of fear not to spread their disease into the EU. Now, they are told to accept the bailout or accelerate the crash of the EU.
If you ask me, the Irish are a most pleasant people and do not deserve to suffer all this crap. But who cares about the people, how likable, mannered and generally modest (yes) they are, anyway. They must heed the super-statal call to unity in the EU they love.

Mr. Pritchard is more knowledgeable than me in EU matters, me the loudmouth, but he speaks to my heart's joy

"Ireland was the one country forced to hold a vote by its constitutional court. When this lonely electorate also voted no, the EU again disregarded the result and intimidated Ireland into voting a second time to get it “right”.
This is the behaviour of a proto-Fascist organization, so if Ireland now – by historic irony, and in condign retribution – sets off the chain-reaction that destroys the eurozone and the European Union, it will be hard to resist the temptation of opening a bottle of Connemara whisky and enjoying the moment. But resist one must. The cataclysm will not be pretty."

I ask again: when you set on course to build such an Union, presumably for eternity like the American motto goes, happily designing a monstruous bureaucracy that's spawning thousands of very elaborate decisions that are involving half a billion people in small detail from economics to politics and private life, how can you not be paying attention to what could happen to your union if the GIANT, VISIBLE, SENSITIVE financial system that supports it gets knocked down, or otherwise altered by external causes? How can the world have hords of economists with the Nobel Prize in economics, but none of them have had the slightest influence on what was going on and coming, as if they didn't see it at all?
Guess I'm pleading for abolishing the Nobel Prize in Economic Sciences What's happening now with the world economy is not... normal. Food prices, up. Precious metal prices, up. Currencies, down. Loans, down. Housing bubble. Austerity for a billion people. What is this, anyway?
The leaders at the head of each country, not at super-statal institutions should first listen to what their people want (not much - just to be enabled to plan for the future), then hire some economists and work them night and day to put order in this "global" (damn their globalist wet dreams) mess. Trade was safe and sound before the EU and the Euro.
I am sure that anything I and the next man say in this matter is not different in value to what any Nobel-Prized "economist" would say. We've seen where the world has gotten with "help" from these expensive, silent, hidden, highbrow professionals in ivory towers. If what I say is nonsense, then so is what they are saying, with great chutzpah I might add.

[Lyth]

I do get your point but you can't use the economists as fall guys, in all fairness they have said repeatedly that the EU cannot count.

The EU is flawed in most area's, great idea but piss poor projection & management.

I always use their Air traffic control & Foundation as arguments against them but in matters of economy I think their recent misplacement of several billion euro's speaks all for itself.

[RegisterMe]

Some comments on what Beid had to say (deliberately not focussed on the EU).....

1. Economics isn't a perfect science (indeed, some would argue that it isn't a science at all). Influence comes down to many factors, the "correctness" of message not always being one of them, and that's assuming that all the economists actually agree. How many times have you seen a politician actually implement unpopular measures even though they are the right thing to do? Don't forget that "negative influence" is entirely possible, when thought of from an entirely neutral and all-knowing external perspective. I'm willing to bet a fair sum of money that a fair few gifted economists were at hand to help the Greek government (and the other PIGS too?) present a prettier picture than reality….. That's influence too.

2. "What's happening now with the world economy is not…. normal". It's not normal, no. But neither is it irrational.

2a. Commodities (wheat, iron, copper, gold, oil etc) prices are up for three main reasons:-
- Increased demand (eg China)
- Decreased supply (eg fires in Russia reducing the wheat supply, leading to a ban on exports from Russia, leading to a ban on exports from other countries concerned about the security of their own supply).
- Commodities are priced in US dollars. The US economy is in trouble, and the US government is printing dollars in an inflationary attempt (or anti-deflationary perhaps?) to support the economy. The direct result of this is the US dollar losing value. Amongst other things this means that commodities get correspondingly more expensive….

2b. Currencies are not "down". A world of completely freely floating exchange rates should be a zero-sum game. So if the US dollar, the Pound, and the Euro are down (which they are, because of their weak economies and quantitive easing aka printing money), some currencies should be up equivalently. And indeed they are - look at the Canadian dollar, the Brazillian Real, the Yen and the Aussie dollar. The 800lb gorilla in the room is China, which isn't allowing its currency to appreciate. This means that it should be gaining value against a basket of other currencies (ie maintaing the "zero-sum game") but it's not. This leads to massive distortion, both at home in the Chinese economy and abroad in every economy that trades with China. And the ripple affect spreads to include all those countries that trade with countries that trade with China…..

2c. Loans down. You can't have cheap credit (just another word for "loan"), more credit, and safer credit when at the same time you are trying to rebuild the capital that you use to support the provision of that credit. That's the main part of the problem. Risky lending got us into this mess in the first place and now we're demanding that the banks extend more credit more cheaply to people and companies? That's…. illogical. Particularly when there is some evidence (granted, I don't think it's as strong as the banks claim) that there isn't actually that much demand out there. See 2d below. Many people and companies globally are saving and or cutting down on their debt (paying for the hangover). What they're not doing is spending or investing.

2d. Housing bubble. More the end of one actually (though some places like Australia and possibly the UK are living on borrowed time). I've dealt with this extensively before in other threads (use Google advanced search) but… too much cheap money sloshing around, low returns, the perception that house prices were a one way bet, political support, weak regulation and supercharging by new fangled financial engineering all contributed to this. Now it's gone "pop".

3. Austerity for a billion people. Caused directly by the credit fuelled deregulated orgiastic spending binge those same billion people have been on for the last fifteen or so years (granted some at the top were drinking champagne and some at the bottom were fighting for scraps). We're now having to clean up the mess we've made.

4. "….. hidden highbrow professionals in ivory towers". So sure, some of those people were simply wrong. Some of them weren't sure. Some of them were right, but weren't listened to. Now, say those economists turn round and say "put taxes up, cut spending brutally, and stay on this diet for the next ten years. By the way you've not even started to deal with your welfare state, healthcare and pension problems, and if I were an accountant and you were a company I wouldn't sign off your accounts, and you'd be bankrupt". The politicians' response would be "but if I advocated that I'd never get (re)-elected. Let's leave the problem for the next generation". And so at best take minimal measures. Take, for example, our wonderful European Members of Parliament / the European Commission. Whilst many of the EU member countries are cutting their budgets between 10% and 30%, they asked for a 6% increase in theirs. If that isn't out of touch I don't know what is…..

So, no Beid, what you say is not nonsense. It's a good example of the confusion and lack of understanding out there. Most of the time there's no reason for the majority of people to understand this stuff (as with any other esoteric area of life), until it all goes wrong, and they are understandably confused, uncertain about the future, worried and perhaps scared.