Thanks guys
. Beid, I spent enough time on this tonight, I'm going to go and have a hot soak. I'll try and address your questions tomorrow night.....RM
PS. Check out my new sig, it's way cool!!!!
Just how much of a mess is Greece in, and what will happen?
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Beid, I've paraphrased your questions. If I misinterpreted any of them let me know and I'll have another crack at it.
Oh, and another "wall of text" warning.
Also note that I am a lot less confident trying to answer these questions than I am in dealing with other aspects of finance and economics. This is a lot more speculative, and will be a lot more open to criticism.
I'll generalise in the discussion to come, but I think that, more or less, the thrust of what I have to say is probably about right. Just don't rely on it (and for certain don't make any decisions based on it!).
1. How far could this contagion, caused by the failure of the "Western" financial system go? Use as examples Russia, China, Singapore, Japan, Brazil, Jamaica and Malta.
The world is a much more interconnected place than it used to be, even ten or twenty years ago. There really is a "global economy". But it isn't equally interconnected. A place like Bhutan gets a few tourists a year, a place like the US is almost completely open to the vagaries of trade, globalisation and the markets...... This has brought huge benefits, and huge strides in standards of living for many countries that were, a few years ago, horrifically poor. But it has not been without cost, and there are still far to many people living wretched lives.
Benefits include much cheaper goods, increasing standards of living as a result. It's contributed to lower inflation, which results in lower interest rates (which, as long as things don't spiral out of control like they did in the credit crunch, is a good thing). We've also seen massive improvements in the standards of living in many poor countries, from Ireland to China. Twenty five years ago I was a child visiting my grandparents in Ireland. Significant swathes of the population still lived in poverty, for instance with no central heating, few televisions, poor diets, no jobs and no inside lavatory. Even after the most recent unfolding of events standards of living in Ireland are immeasurably higher than they would otherwise have been without globalisation.
Examples of costs are the wrenching dislocations experienced as industries and their staff are "offshored" (ignoring Canute-like Sarkozy examples, forbidding companies to relocate factories to lower cost locations - the results are inevitable). We have much higher consumption of everything, that has its costs, from cheaper food (more obese people), cheaper booze (more people with drink problems), more pollution as all these goods are shunted about the place, forced resettlement of people (eg in China), enormous disparity in wealth (think Russia more than the US or the west generaly), social unrest, environmental damage.... the list goes on.
In spite of that, I think that the balance is broadly positive.
So, the answer to your question is, "it depends". It depends on how enmeshed in the global economy a country is. It also depends on factors outside the "realm" of the global economy. The following will, absolutely, not be exhaustive, and in some cases may be entirely innaccurate. Let's take each country you mention in turn:-
Russia - Relatively integrated into the global economy but, and it's a very large but, it is not a democracy and not a market based economy. Russia is basically a kleptocracy, with a minimal few people at the top controlling it's economy. It may not be communist anymore, but all large investment decisions are at least guided by the Kremlin. It may export large amounts of natural resources (earning it US dollars), but what it exports, to whom it exports, and the price of those exports, is very much seen as a tool of state.
It is relatively insulated from the effects of the credit crunch, partly because the West (ie the global economy as it was then) has bitter memories of its default at the end of the 90's (meaning less foreign investment), and partly because it is commodity rich.
It is also dying. Its population, ravaged by poor health (drink, drugs, STDs) is shrinking every year, its infrastructure is crumbling, its politics massively unbalanced, and, because of the centralised control, it makes questionable economic decisions.
If I was Putin I'd be a lot more worried about the last paragraph above than I would be about the impact of the credit crunch.
China - Very integrated with the global economy. But in a very strange way. There are amazing stresses building up in China, both economically and politically, and the leadership really does have to walk a tightrope.
Its basic problem is twofold. Firstly the Communist Party must (in its eyes) maintain control. Secondly, in order to keep its population quiescent enough, it believes it needs to manage at least an 8% year on year growth rate. To achieve the latter it keeps its currency cheap (it is basically pegged against the US Dollar), to keep its exports cheap.
But what does it do with all the US Dollars it earns? It soaks them up (leading to inflation), and it buys commodities (leading to increased commodity prices for all other countries), and it "saves", by investing in foreign assets. Foreign assets like US Treasury Bills. What impact does this have? It keeps money cheap for the US, encouraging the US to borrow, further exacerbating global financial imbalance.
What it should do is allow its currency to float. This would result in a rise in its currency against the US Dollar. This would cause its exports to increase in cost (and decrease the cost of its imports) which would go some way to redressing the imbalances building up globally. To achieve its growth targets it needs to turn inwards and focus on domestic growth, whether that be making consumer goods more available to its population, or improving its infrastructure and services.
But this requires the Communist Party to relax its control.
So I have some sympathy with American politicians bashing China about its economic policies. I also have some sympathy with a derivatives trader I was talking to in Hong Kong back back a few years. He said to me something to the effect of "Christ, all these westerners bitching about China are talking rubbish. If they were in charge of a restless, growing, poor population of 1.5 billion, would they take the lid off? Don't be stupid.....".
Singapore - very open to the global economy, but also utterly dependent on the trade the drives the global economy. So in essence very vulnerable to the crazy whirlwind we're all experiencing at the moment. Except that is for fate. It's the largest shipping port in the world. And it's sat right on the pinch point between China (and Japan) and most of the rest of the world (excluding the US West Coast and Australasia).
As long as China continues to trade Singapore will be just fine.
Japan - Japan is an interesting one. Financially speaking it's very open to the ebb and flow of savings and borrowings. The problem is that foreign investment, seeking control (or even starting up new companies) faces huge cultural, bureaucratic and market based obstacles. There's no vigor in Japan (added to which is its rapidly aging population). And there's no spark to catalise that vigor. It's living on the savings it earnt during its huge post-war industrial expansion. They are running out.
It also lives in (and sees itself as an important player) in a volatile part of the world - a rising, expansionist China, a nuclear armed Korea that is fond of confrontation, an ailing America on which it relies for security....
Interesting times ahead for Japan, it will take political vision and courage for it to retain its global importance (and its standard of living).
Brazil - Brazil is very well positioned. It didn't take a hit from the credit crunch. It has a young a growing, increasingly well educated population, it is the regional power in South America. It has a strong commodity export position that sees increasing trade with China year on year. It's also introduced some (gentle, unlike China) capital controls to moderate the potentially extreme effects of foreign capital flows (think back to the Asian financial crisis - a wall of hot foreign money invested seeking high returns because of the "Asian growth miracle" story, all of which dried up overnight when the economies went "pop").
Jamaica - a relatively poor country, neighbour to the US, little industry, very reliant on tourism and remitances from Jamaicans living abroad (not sure about this last point, but I suspect it might be). It hasn't got far to "crash", because it was never very high on the hog to start with, but it will see lower growth and limited, if any, improvements in standards of living over the next few years. Tourism will be down. Remitances will be down.
Malta - I honestly haven't a clue. Other than knowing that it is a small island in the Med I know nothing about it. I suspect it will be even more insulated than Jamaica - it's richer, but has less dependent integration with the global economy precisely because it is so small. I'm guessing.....
So, to sum up my answer to question one, it depends. You're probably beginning to get a feel now for why economists struggle to predict everything perfectly!
2. Of those countries not affected in the same way as the US and European countries (aka being "bought off by the IMF"), why are they not affected.
See above. Because they are different. Openness to the global economy is part of it, as is the "sophistication" of their banking systems, but there are many, many other factors in play.
Though I'm not sure I get your "bought off by the IMF" comment. The IMF is a "lender of last resort for countries". It is supported by many countries, largely in proportion to the size of their economies. It learnt its lessons in the aftermath to the Asian financial crisis. Back then it waited for things to go bad before stepping in to try and help clean up. Now it gets in earlier, and tries to forestall the worst of the problems. Let's see what the score is in five years time.
As for "buying countries off", it doesn't. It says "ok, we'll lend you this money you need, but before we do so we need confidence that we will get it back. The things that got you into this mess in the first place were x, y and z. Change them".
Say you spent $10,000 on "wine, women and song". Then say you borrowed another $5,000 and spent it the same way. Somebody lent you that money because you had a good job and they were confident that they would get it back. Only you lost your job because you'd partied way too hard. Now you return to your friend, your family, or your bank and say "Look, I really need help now, can you lend me another $10,000 to help me get back on my feet"?
A few conditions aren't unreasonable are they? Starting with asking you to stop partying.....
3. Why did the West not pay attention to the "financial models" of those countries not affected, and seek to emulate them?
Again, see the answer to 1. above. Countries are different. They operate in different ways, for different reasons, and are exposed to different opportunities and different pressures. The main reason that Italy didn't suffer directly during the credit crunch was because their banks weren't "sophisticated enough" to get swept up in the sub-prime / CDO crazyness. That bit of "their model" worked for them (but it would not have worked for the US, the UK, Ireland, France, Germany or Japan). Equally Italy has its own challenges, low tax take, corruption, abysmal productivity, high debts, and politics that would be laughable if it wasn't so distressing.
Some of the stresses directly exposed by the credit crunch are now exposing the fault lines in some countries' ecomies. The first example was Greece. Ireland was more directly hit by the fallout, but it took longer to show through. Italy has its problems, and it needs to tackle them. Otherwise it will get hit.
Chancellor Merkel said a day or so ago something to the effect that "Finance has to learn that it is subordinate to politics". Only it isn't. It's orthogonal to politics. She can't command people to lend. And when she suggests that she can people get scared, and take their money away. Every time she has commented on the financial situation that European countries face, and the finance industry in general, in the last six months, European borrowing costs have gone up. When will she learn?
I can't find the comment but Bill Clinton once said something along the lines of "I thought I was the most powerful person in the world until I met the bond markets". Chancellor Merkel needs to come to the same conclusion, quickly. She's doing as much damage to Europe's prospects as Greece and Ireland are combined.
Otherwise the bond markets simply aren't going to be there, and Europe will be bust.
Oh, and another "wall of text" warning
.Also note that I am a lot less confident trying to answer these questions than I am in dealing with other aspects of finance and economics. This is a lot more speculative, and will be a lot more open to criticism.
I'll generalise in the discussion to come, but I think that, more or less, the thrust of what I have to say is probably about right. Just don't rely on it (and for certain don't make any decisions based on it!).
1. How far could this contagion, caused by the failure of the "Western" financial system go? Use as examples Russia, China, Singapore, Japan, Brazil, Jamaica and Malta.
The world is a much more interconnected place than it used to be, even ten or twenty years ago. There really is a "global economy". But it isn't equally interconnected. A place like Bhutan gets a few tourists a year, a place like the US is almost completely open to the vagaries of trade, globalisation and the markets...... This has brought huge benefits, and huge strides in standards of living for many countries that were, a few years ago, horrifically poor. But it has not been without cost, and there are still far to many people living wretched lives.
Benefits include much cheaper goods, increasing standards of living as a result. It's contributed to lower inflation, which results in lower interest rates (which, as long as things don't spiral out of control like they did in the credit crunch, is a good thing). We've also seen massive improvements in the standards of living in many poor countries, from Ireland to China. Twenty five years ago I was a child visiting my grandparents in Ireland. Significant swathes of the population still lived in poverty, for instance with no central heating, few televisions, poor diets, no jobs and no inside lavatory. Even after the most recent unfolding of events standards of living in Ireland are immeasurably higher than they would otherwise have been without globalisation.
Examples of costs are the wrenching dislocations experienced as industries and their staff are "offshored" (ignoring Canute-like Sarkozy examples, forbidding companies to relocate factories to lower cost locations - the results are inevitable). We have much higher consumption of everything, that has its costs, from cheaper food (more obese people), cheaper booze (more people with drink problems), more pollution as all these goods are shunted about the place, forced resettlement of people (eg in China), enormous disparity in wealth (think Russia more than the US or the west generaly), social unrest, environmental damage.... the list goes on.
In spite of that, I think that the balance is broadly positive.
So, the answer to your question is, "it depends". It depends on how enmeshed in the global economy a country is. It also depends on factors outside the "realm" of the global economy. The following will, absolutely, not be exhaustive, and in some cases may be entirely innaccurate. Let's take each country you mention in turn:-
Russia - Relatively integrated into the global economy but, and it's a very large but, it is not a democracy and not a market based economy. Russia is basically a kleptocracy, with a minimal few people at the top controlling it's economy. It may not be communist anymore, but all large investment decisions are at least guided by the Kremlin. It may export large amounts of natural resources (earning it US dollars), but what it exports, to whom it exports, and the price of those exports, is very much seen as a tool of state.
It is relatively insulated from the effects of the credit crunch, partly because the West (ie the global economy as it was then) has bitter memories of its default at the end of the 90's (meaning less foreign investment), and partly because it is commodity rich.
It is also dying. Its population, ravaged by poor health (drink, drugs, STDs) is shrinking every year, its infrastructure is crumbling, its politics massively unbalanced, and, because of the centralised control, it makes questionable economic decisions.
If I was Putin I'd be a lot more worried about the last paragraph above than I would be about the impact of the credit crunch.
China - Very integrated with the global economy. But in a very strange way. There are amazing stresses building up in China, both economically and politically, and the leadership really does have to walk a tightrope.
Its basic problem is twofold. Firstly the Communist Party must (in its eyes) maintain control. Secondly, in order to keep its population quiescent enough, it believes it needs to manage at least an 8% year on year growth rate. To achieve the latter it keeps its currency cheap (it is basically pegged against the US Dollar), to keep its exports cheap.
But what does it do with all the US Dollars it earns? It soaks them up (leading to inflation), and it buys commodities (leading to increased commodity prices for all other countries), and it "saves", by investing in foreign assets. Foreign assets like US Treasury Bills. What impact does this have? It keeps money cheap for the US, encouraging the US to borrow, further exacerbating global financial imbalance.
What it should do is allow its currency to float. This would result in a rise in its currency against the US Dollar. This would cause its exports to increase in cost (and decrease the cost of its imports) which would go some way to redressing the imbalances building up globally. To achieve its growth targets it needs to turn inwards and focus on domestic growth, whether that be making consumer goods more available to its population, or improving its infrastructure and services.
But this requires the Communist Party to relax its control.
So I have some sympathy with American politicians bashing China about its economic policies. I also have some sympathy with a derivatives trader I was talking to in Hong Kong back back a few years. He said to me something to the effect of "Christ, all these westerners bitching about China are talking rubbish. If they were in charge of a restless, growing, poor population of 1.5 billion, would they take the lid off? Don't be stupid.....".
Singapore - very open to the global economy, but also utterly dependent on the trade the drives the global economy. So in essence very vulnerable to the crazy whirlwind we're all experiencing at the moment. Except that is for fate. It's the largest shipping port in the world. And it's sat right on the pinch point between China (and Japan) and most of the rest of the world (excluding the US West Coast and Australasia).
As long as China continues to trade Singapore will be just fine.
Japan - Japan is an interesting one. Financially speaking it's very open to the ebb and flow of savings and borrowings. The problem is that foreign investment, seeking control (or even starting up new companies) faces huge cultural, bureaucratic and market based obstacles. There's no vigor in Japan (added to which is its rapidly aging population). And there's no spark to catalise that vigor. It's living on the savings it earnt during its huge post-war industrial expansion. They are running out.
It also lives in (and sees itself as an important player) in a volatile part of the world - a rising, expansionist China, a nuclear armed Korea that is fond of confrontation, an ailing America on which it relies for security....
Interesting times ahead for Japan, it will take political vision and courage for it to retain its global importance (and its standard of living).
Brazil - Brazil is very well positioned. It didn't take a hit from the credit crunch. It has a young a growing, increasingly well educated population, it is the regional power in South America. It has a strong commodity export position that sees increasing trade with China year on year. It's also introduced some (gentle, unlike China) capital controls to moderate the potentially extreme effects of foreign capital flows (think back to the Asian financial crisis - a wall of hot foreign money invested seeking high returns because of the "Asian growth miracle" story, all of which dried up overnight when the economies went "pop").
Jamaica - a relatively poor country, neighbour to the US, little industry, very reliant on tourism and remitances from Jamaicans living abroad (not sure about this last point, but I suspect it might be). It hasn't got far to "crash", because it was never very high on the hog to start with, but it will see lower growth and limited, if any, improvements in standards of living over the next few years. Tourism will be down. Remitances will be down.
Malta - I honestly haven't a clue. Other than knowing that it is a small island in the Med I know nothing about it. I suspect it will be even more insulated than Jamaica - it's richer, but has less dependent integration with the global economy precisely because it is so small. I'm guessing.....
So, to sum up my answer to question one, it depends
. You're probably beginning to get a feel now for why economists struggle to predict everything perfectly!2. Of those countries not affected in the same way as the US and European countries (aka being "bought off by the IMF"), why are they not affected.
See above. Because they are different. Openness to the global economy is part of it, as is the "sophistication" of their banking systems, but there are many, many other factors in play.
Though I'm not sure I get your "bought off by the IMF" comment. The IMF is a "lender of last resort for countries". It is supported by many countries, largely in proportion to the size of their economies. It learnt its lessons in the aftermath to the Asian financial crisis. Back then it waited for things to go bad before stepping in to try and help clean up. Now it gets in earlier, and tries to forestall the worst of the problems. Let's see what the score is in five years time.
As for "buying countries off", it doesn't. It says "ok, we'll lend you this money you need, but before we do so we need confidence that we will get it back. The things that got you into this mess in the first place were x, y and z. Change them".
Say you spent $10,000 on "wine, women and song". Then say you borrowed another $5,000 and spent it the same way. Somebody lent you that money because you had a good job and they were confident that they would get it back. Only you lost your job because you'd partied way too hard. Now you return to your friend, your family, or your bank and say "Look, I really need help now, can you lend me another $10,000 to help me get back on my feet"?
A few conditions aren't unreasonable are they? Starting with asking you to stop partying.....
3. Why did the West not pay attention to the "financial models" of those countries not affected, and seek to emulate them?
Again, see the answer to 1. above. Countries are different. They operate in different ways, for different reasons, and are exposed to different opportunities and different pressures. The main reason that Italy didn't suffer directly during the credit crunch was because their banks weren't "sophisticated enough" to get swept up in the sub-prime / CDO crazyness. That bit of "their model" worked for them (but it would not have worked for the US, the UK, Ireland, France, Germany or Japan). Equally Italy has its own challenges, low tax take, corruption, abysmal productivity, high debts, and politics that would be laughable if it wasn't so distressing.
Some of the stresses directly exposed by the credit crunch are now exposing the fault lines in some countries' ecomies. The first example was Greece. Ireland was more directly hit by the fallout, but it took longer to show through. Italy has its problems, and it needs to tackle them. Otherwise it will get hit.
Chancellor Merkel said a day or so ago something to the effect that "Finance has to learn that it is subordinate to politics". Only it isn't. It's orthogonal to politics. She can't command people to lend. And when she suggests that she can people get scared, and take their money away. Every time she has commented on the financial situation that European countries face, and the finance industry in general, in the last six months, European borrowing costs have gone up. When will she learn?
I can't find the comment but Bill Clinton once said something along the lines of "I thought I was the most powerful person in the world until I met the bond markets". Chancellor Merkel needs to come to the same conclusion, quickly. She's doing as much damage to Europe's prospects as Greece and Ireland are combined.
Otherwise the bond markets simply aren't going to be there, and Europe will be bust.
I can't breathe.
- George Floyd, 25th May 2020
- George Floyd, 25th May 2020
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Aye Capn
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RegisterMe
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lilstinker
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I heard this on a radio show and immediately thought of this thread.
Some of you euros might have allready heard this but in case you have'nt.
Nigel Farage: 'Who the Hell do You Think You Are: The Euro Game Is Up!
I LOVE this guy!
And woe to you germans. As far as i can tell your country is the only one that's actually in decent shape.You'll be the ones that are going to end up having to shoulder the burden of all this.How are you going to like it when the EU demands a complete surrender of your sovereignty and national identity once and for all for the benefit of the greater centralized power structure. Mutually assured destruction.
From each according to his ability, to each according to his needs.
How's that centralized command and control economies socialism thing working out for ya now?
I seem to recall some people predicting all this crap thats happening now and being called crazy right wing scaremonger conspiracy theorists a couple decades ago.
Don't worry, you won't be lonely.America is right behind ya.
Trickle Down Bankruptcy
Some of you euros might have allready heard this but in case you have'nt.
Nigel Farage: 'Who the Hell do You Think You Are: The Euro Game Is Up!
I LOVE this guy!
And woe to you germans. As far as i can tell your country is the only one that's actually in decent shape.You'll be the ones that are going to end up having to shoulder the burden of all this.How are you going to like it when the EU demands a complete surrender of your sovereignty and national identity once and for all for the benefit of the greater centralized power structure. Mutually assured destruction.
From each according to his ability, to each according to his needs.
How's that centralized command and control economies socialism thing working out for ya now?
I seem to recall some people predicting all this crap thats happening now and being called crazy right wing scaremonger conspiracy theorists a couple decades ago.
Don't worry, you won't be lonely.America is right behind ya.
Trickle Down Bankruptcy
Government, even in its best state, is but a necessary evil; in its worst state, an intolerable one. ~ Thomas Paine
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silenced
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We're the cash cow of europe, yes, and everyone is kicking us in the groin all the time to get more money out of our ass.lilstinker wrote:And woe to you germans. As far as i can tell your country is the only one that's actually in decent shape.You'll be the ones that are going to end up having to shoulder the burden of all this.How are you going to like it when the EU demands a complete surrender of your sovereignty and national identity once and for all for the benefit of the greater centralized power structure. Mutually assured destruction.
I'm curious who pays our debts when europe is finally broke.
And no, we're not really in a decent shape, since we 'pay' our european friends to destroy our economy. If you ask me, the project "European Union" has failed and we should go back to what it was before the €uro and that 'unification'. It will hurt, of course, but the sooner the better, or it will hurt even more.Europe cannot work, not as it is 'constructed' currently. The only way it would work is if we had a european construct similar to the USA. One government to rule them all and lots of states with local governments. I cannot think of any other possibility, because of the nationalism in all states is too selfish, and as long as they are sovereign -> no chance for Europe.
... what is a drop of rain, compared to the storm? ... what is a thought, compared to the mind? ... our unity is full of wonder which your tiny individualism cannot even conceive ... I've heard it all before ... you're saying nothing new ... I thought I saw a rainbow ... but I guess it wasn't true ... you cannot make me listen ... I cannot make you hear ... you find your way to heaven ... I'll meet you when you're there ...
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Aye Capn
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My skepticism toward Europe has more to do with my general understanding that authority and accountability must align for any endeavor to be successful over the long-term.
I'm also curious whether Reg is German. Were I European I would believe a lot more in "unification" if I were a member of a recipient nation and conversely be much more skeptical were I a citizen of a donor nation.
If you're Irish or Greek you're getting a heck of a deal by being part of a Greater Europe. If you're German? Maybe not so much. But I don't know enough about it to understand what the advantages of a Greater Europe might be for a German, so ... maybe you and Reg can discuss it while the rest of us take notes?
I'm also curious whether Reg is German. Were I European I would believe a lot more in "unification" if I were a member of a recipient nation and conversely be much more skeptical were I a citizen of a donor nation.
If you're Irish or Greek you're getting a heck of a deal by being part of a Greater Europe. If you're German? Maybe not so much. But I don't know enough about it to understand what the advantages of a Greater Europe might be for a German, so ... maybe you and Reg can discuss it while the rest of us take notes?
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lilstinker
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Errrmmm. Right about now if we were face to face i'd be grabbing you by the neck and shaking you saying "wtf are you thinking?"only way it would work is if we had a european construct similar to the USA. One government to rule them all and lots of states with local governments.
Serious side though. That is mainly how our system is working nowadays.
The EU is a copy of what the US has become, but it was'nt allways this way for us. Note that our real problems started when we started down this centralized federal power road(pre world war 1). What you just said is a common misconception even among americans though. What else is to be expected when a central federal authority controls the schools. It teaches history revision to it's own benefit.
The US government was created by the states, not the states created by the federal government.You have to go back to 1913 and a lesser degree pre civil war to see the proper power structure in effect.
USA was intended to be a small tightly restricted federal government that handles specified duties for the benefit of all the states within it. Mutual defense,unrestricted free trade amongst states and free immigration from one state to the next being the main reasons for the compact known as the US constitution.
If you read it and study the circular power structure and restrictions, the founders placed absolutely no trust whatsoever in a centralized federal government.
The states (13 at the time) were to be the true power within the compact. Each a sovereign entity unto themself. The net effect being to force the state governments(essentially sovereign countries unto themself) to compete for citizens by being the least oppressive since changing residency is unrestricted under the compact.(I.E citizens voting with their feet) Functionally turning the states into minature laboratories of good and bad ideas. If a state does something stupid it can kiss it's tax dollars goodbye, forcing it to fix itself. But the errors of one would not oppress the many and ensure liberty and prosperity as the normal status of the country.
The premise is perfection unto itself. The problem is nobodys perfect.
The founders did an excelent job putting the constitution together but there are some flaws in it. Patrick Henry was a staunch opponent of it because of those flaws. 234 years ago he predicted everything that's happening today with the federal government swallowing the authority and sovereignty of the states eventually resulting in the country operating just like the tyrants we revolted from.
The exact same thing is happening in the EU right before our eyes in record time due to the lack of restrictions on the EU's scope of authority.
The biggest problems with the EU and US are essentially structural. It can be fixed but it will require considerable pain for any of the human parasites that's drinking the government subsidy koolaid. The political elites are not going to give up their gravy train easily though so in the end the effort might be doomed from the start.
To steal a bit from Lenin. They have the guns, and they're definitely for them.
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RegisterMe
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Tracker001
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[ external image ]lilstinker wrote:I heard this on a radio show and immediately thought of this thread.
Some of you euros might have allready heard this but in case you have'nt.
Nigel Farage: 'Who the Hell do You Think You Are: The Euro Game Is Up!
Edit :
Was wondering what monitary device was used the Greak bailout .Link
And the Band Played on ......Forced to eat ‘humble pie’ and commit to their future, the EU has stepped up to the plate and pledged debt-burdened Greece a rescue package at below-market interest rates as they try to end this member fiscal crisis and restore confidence in the ailing EUR. The Fitch downgrading last week certainly sped up this rescue process. The EU maneuver has eaten into the -5.7% currency depreciation year-to-date with the ‘buck’. Greece was offered 30b euro’s in 3-year loans at 5%, which is less than the current 3-year Greek yield of 6.98%. Another 15b would come from the IMF. Much will depend on Greece’s ability to raise their ‘own’ capital this week on the open market. With the EU backing making the process more palatable for investors, any struggle in raising the required 1.2b euros will again question investor confidence in the country’s ability to repay its debts and pressurize the EUR.
Last edited by Tracker001 on Mon, 6. Dec 10, 20:06, edited 2 times in total.
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silenced
- Posts: 4967
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... what is a drop of rain, compared to the storm? ... what is a thought, compared to the mind? ... our unity is full of wonder which your tiny individualism cannot even conceive ... I've heard it all before ... you're saying nothing new ... I thought I saw a rainbow ... but I guess it wasn't true ... you cannot make me listen ... I cannot make you hear ... you find your way to heaven ... I'll meet you when you're there ...
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Tracker001
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Published: Monday, 22 Nov 2010 | 9:51 AM ET
) IMF/World Bank/WTO have to say about this ?
these companies are also stateing with moves like this is "We don't mind paying tax's .it's just we would like to have our arms and legs left afterwords .
All cost of doing bizz is passed on the the end-user. So what do high taxes on bizz do but hurt the consumer and allow politions to waist more money .
Wonder what the (One world currency pplGENEVA - Switzerland could face political pressure from the United States and European Union if foreign companies continue taking advantage of the country's low tax rates by moving their corporate headquarters here, a Swiss official said Monday.
Large global companies that relocate just a handful of staff to Switzerland and then benefit from lower taxes on their international earnings could prompt the ire of Washington and Brussels, said a spokesman for the Swiss federal office for international financial matters.
) IMF/World Bank/WTO have to say about this ?these companies are also stateing with moves like this is "We don't mind paying tax's .it's just we would like to have our arms and legs left afterwords .
All cost of doing bizz is passed on the the end-user. So what do high taxes on bizz do but hurt the consumer and allow politions to waist more money .
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lilstinker
- Posts: 318
- Joined: Mon, 13. Oct 08, 20:32
Damn straight.these companies are also stateing with moves like this is "We don't mind paying tax's .it's just we would like to have our arms and legs left afterwords .
All cost of doing bizz is passed on the the end-user. So what do high taxes on bizz do but hurt the consumer and allow politions to waist more money .
Something that cracks me up is lots of people(particularly on the left) like to call companies greedy. But what about greedy governments that end up making more on a product than the company making without doing a single thing to earn that money it taxes from the company.
And once the government takes the money it goes down an economic black hole and produces NOTHING.
Seems like too many people like ignoring the elephant sitting in the middle of room.
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travisdh1
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What was that old line? All good comedy has a grain of truth.lilstinker wrote:In depth analysis video of the fiscal problem the EU is facing
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RegisterMe
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Aye Capn
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You said you believed in a unified Europe. Does that mean you believe Britain should give up the pound and join the Eurozone, or is it totally ok to just be part of the EU but keep your own currency?RegisterMe wrote:Nope, I'm British. More specifically a born and bred Londoner.Aye Capn wrote:I'm also curious whether Reg is German.
Why, if you think Britain should keep the pound, do you think the Germans should be stuck with the Euro? Why can't they pull out of the Eurozone but stay in the EU just like Britain?
Or if you think Britain should join the Eurozone, aren't you afraid the PIIGS will soak you just like they're about to do to Germany?
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RegisterMe
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Is what I said.RegisterMe wrote:I do believe in Europe. I don't believe in a Europe in denial about its problems, unwilling to accept painful structural reforms, organisationally incoherent, corrupt, inefficient and King Canute-like trying to hold the sea back. The diplomatic ramifications of not bailing Greece and Ireland out would have been horrific. It would have meant the end of the European experiment.
So yes, I do, very reluctantly, support the bailouts of Greece and Ireland (which is different to saying that I am convinced that they will work).
I just don't think that this lesson will be taken on board by the politicians. They simply don't have the moral fibre (which is why I am not convinced that they will work).
I believe in the EU. I believe that the Euro is now important enough to the EU that it needs to be defended and supported by the EU.
But no, I don't believe that the UK should give up Sterling. The reason for this is that I have always seen the Euro as primarily being a political project, and I don't believe in those politicians (or indeed the political institutions) steering it.
Why can't Germany pull out? It could. But I don't think it will. For a good treatment of the issues read this.
I can't breathe.
- George Floyd, 25th May 2020
- George Floyd, 25th May 2020
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lilstinker
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If there's two things i can sit and listen to all day long it's a pissed off black woman(unless i'm the subject of said rage ) and a furious irishman telling you how it is.
Seriously foul just about enough to make the pope croak language warning
An Irishman Speaks His Mind
Edit: Happy?
) and a furious irishman telling you how it is.Seriously foul just about enough to make the pope croak language warning
An Irishman Speaks His Mind
Edit: Happy?
Last edited by lilstinker on Sat, 11. Dec 10, 20:50, edited 1 time in total.
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Tracker001
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