Varoufakis gave his first post- resignation interview last night to the Australian ABC. Excellent. Well worth listening to.
http://www.abc.net.au/radio/programitem/...?play=true
http://www.abc.net.au/radio/programitem/...?play=true
Quote: (07-14-2015 12:34 AM)Samseau Wrote:
Looks like Greece is going to have to sell off their Islands so they can have a few more years of austerity:
http://www.zerohedge.com/news/2015-07-13...ture-and-m
This just goes to show how wrong guys like Phoenix are on fractional reserve banking - Greece gets poorer and poorer, they lose more and more, yet their debt is never resolved. And it's because there's more debt in the system than can possibly be paid back due to exponential interest.
Quote: (07-13-2015 06:11 PM)H1N1 Wrote:
Quote: (07-13-2015 06:02 PM)poutsara Wrote:
The Parthenon marbles have been sitting in the British Museum for about two centuries. Taken right before Greece became independent. Some of the most important works of art of antiquity, and arguably, all of Western Civilization.
How much is a 200 year lease worth? Perhaps 100 billion Euros - that should cover it.
We can probably arrange for them to be transferred straight to Germany for you, with all the rest of your stuff.
Quote: (07-13-2015 06:11 PM)H1N1 Wrote:I'll phone the Chancellor.
Quote: (07-13-2015 06:02 PM)poutsara Wrote:
The Parthenon marbles have been sitting in the British Museum for about two centuries. Taken right before Greece became independent. Some of the most important works of art of antiquity, and arguably, all of Western Civilization.
How much is a 200 year lease worth? Perhaps 100 billion Euros - that should cover it.
We can probably arrange for them to be transferred straight to Germany for you, with all the rest of your stuff.
Quote: (07-13-2015 05:46 AM)Dan Woolf Wrote:
Quote: (07-13-2015 05:33 AM)dreambig Wrote:
Yet another bailout it is then.
http://www.bbc.com/news/world-europe-33503955
Jesus they are making one huge mess of this and humiliating Greece in the process.
I was really hopeful that Greece were finally going to be put out of their misery.
See you in 2-3 years when the Greeks come back for even more.
These eurocrats are delaying the inevitable which is the total collapse of the Euro.
They want to create the United States of Europe and they will cling to that goal until the bitter end.
Quote: (07-14-2015 02:28 AM)Medic42 Wrote:
Quote: (07-13-2015 06:11 PM)H1N1 Wrote:
Quote: (07-13-2015 06:02 PM)poutsara Wrote:
The Parthenon marbles have been sitting in the British Museum for about two centuries. Taken right before Greece became independent. Some of the most important works of art of antiquity, and arguably, all of Western Civilization.
How much is a 200 year lease worth? Perhaps 100 billion Euros - that should cover it.
We can probably arrange for them to be transferred straight to Germany for you, with all the rest of your stuff.
Quote: (07-14-2015 02:31 AM)eradicator Wrote:
What will the bitter end look like? Honestly, I thought we were looking at the bitter end now, but they got another round of bailouts.
Quote: (07-14-2015 11:03 AM)Dan Woolf Wrote:
Quote: (07-14-2015 10:37 AM)dreambig Wrote:
...
All of this accumulated debt - left to the generations ahead. This won't end well.
How will it end? Would be great if there was a topic in Deep Forum talking about this. I read the "Modern Economics is just one big scam" thread by Zelcorpion and got a boner.
All I can get from mainstream sources is that "there won't be any contagion/domino effect because of Greece, we've got it covered, everything's fine", even though it's probably the opposite (especially politically). Then, on top of that, US is probably a house of cards and China is a big bubble. Add automation and other things into that mix and I have no idea what's going to happen and when.
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We’ve now got hold of the new IMF report into Greece’s debt sustainability.
And a quick perusal shows that the Fund has comprehensively obliterated the notion that this third Greek bailout will work, as it stands.
The introduction to the report says enough, really:
Greece’s public debt has become highly unsustainable. This is due to the easing of policies during the last year, with the recent deterioration in the domestic macroeconomic and financial environment because of the closure of the banking system adding significantly to the adverse dynamics.
The financing need through end-2018 is now estimated at €85bn and debt is expected to peak at close to 200 percent of GDP in the next two years, provided that there is an early agreement on a program. Greece’s debt can now only be made sustainable through debt relief measures that go far beyond what Europe has been willing to consider so far.
The IMF’s fundamental conclusion is that Greece will simply not be able to borrow at affordable rates again, until its debt burden is lower.
The situation was already bad - but recent developments make it much, much worse.
The events of the past two weeks—the closure of banks and imposition of capital controls—are extracting a heavy toll on the banking system and the economy, leading to a further significant deterioration in debt sustainability relative to what was projected in our recently published DSA.
Today’s report is light on projections, but the ones included are stark enough. The stand-out fact: Greek debt is on track to peak at close to 200% of GDP in the next two years. Only Japan, after two lost decades, comes close to that ratio.
Perhaps this is why the US government, led by Treasury secretary Jack Lew, has been so vocal about the need for debt sustainability to be addressed?
The IMF is also amusingly sniffy about the targets Greece is being set. For example:
Medium-term primary surplus target: Greece is expected to maintain primary surpluses for the next several decades of 3.5 percent of GDP. Few countries have managed to do so. The reversal of key public sector reforms already in place— notably pension and civil service reforms—without yet any specification of alternative reforms raises concerns about Greece’s ability to reach this target
But it’s conclusion is clear - if Europe wants this bailout to work, it must either grant Greece three decades grace before repaying its debts, or cut the face value of its borrowings, deeply....
Quote: (07-14-2015 10:16 PM)Dan Woolf Wrote:
IMF fires a cannonball into Greek bailout
http://www.theguardian.com/business/live...ne-uk-live
Quote:Quote:
But it’s conclusion is clear - if Europe wants this bailout to work, it must either grant Greece three decades grace before repaying its debts, or cut the face value of its borrowings, deeply....
More at:
http://www.theguardian.com/business/2015...ebt-relief
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GREECE’D: We Voted ‘No’ to slavery,
but ‘Yes’ to our chains
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Resistance to nowhere
But it’s a resistance whose leaders are leading them nowhere.
For decades, Greeks have suffered governments that are both corrupt and dishonest. The election of SYRIZA changed all that: the government is now merely dishonest.
Our new SYRIZA Prime Minister, Alexis Tsipras, correctly called the austerity plan “blackmail.” However, before Sunday’s vote, Tsipras told the nation a big fat fib. He said we could vote down the European Bank’s plan but keep the European Bank’s coin, the euro. How? Tsipras won’t say; it’s part of a policy ploy his outgoing finance minister Yanis Varoufakis calls “creative ambiguity.” To translate: Creative ambiguity is Greek for “bullshit.”
Sorry, Alexis, if you want to use the Reich’s coin you have to accept the Reichsdiktat.
Not a coin, a virus
Tsipras’ claim that Greece can keep the euro while rejecting austerity is crazy-talk. The fact is that German Chancellor Angela Merkel, the Cruella De Vil of the Eurozone, will ignore the cries of the bleeding Greeks and demand we swallow austerity--or lose the euro.
But, so what if we lose the euro? The best thing that can happen to Greece, and should have happened long, long ago, is that Greece flee the Eurozone.
That’s because it is the euro itself that is the virus responsible for Greece’s economic ills.
Indeed, the sadistic commitment to “austerity” was minted into the coin’s very metal. We’re not guessing. One of us (Palast, an economist by training) has had long talks with the acknowledged “father” of the euro, Professor Robert Mundell. It’s important to mention the other little bastard spawned by the late Prof. Mundell: “supply-side” economics, otherwise known as “Reaganomics,” “Thatcherism” – or, simply “voodoo” economics.
The imposition of the euro had one true goal: To end the European welfare state.
For Mundell and the politicians who seized on his currency concept, the euro itself would be the vector infecting the European body politic with supply-side Reaganomics. Mundell saw a euro’d Europe as free of trade unions and government regulations; a Europe in which the votes of parliaments were meaningless. Each Eurozone nation, unable to control neither the value of its own currency, nor its own budget, nor its own fiscal policy, could only compete for business by slashing regulations and taxes. Mundell said, "[The euro] puts monetary policy out of the reach of politicians… Without fiscal policy, the only way nations can keep jobs is by the competitive reduction of rules on business."
Here’s how it works. To join the Eurozone, nations must agree to keep their deficits to no more than 3% of GDP and total debt to no more than 60% of GDP. In a recession, that’s plain insane. By contrast, President Obama pulled the USA out of recession by increasing deficit spending to a staggering 9.8% of GDP, and he raised the nation’s debt to 101% from a pre-recession 62%. Republicans screamed, but it worked. The US has lower unemployment than any Eurozone nation.
As Obama scolded the European tormentors of Greece: “You cannot keep on squeezing countries that are in the midst of depression.” Cutting spending power only leads to less spending which leads to further cuts in spending power – a death spiral we see today in the Eurozone from Greece to Italy to Spain—but not in Germany.
“Not in Germany.” There’s the rub. Normally, a nation such as Greece can quickly recover from debt-induced recession by devaluing its currency. Greece would become a dirt cheap tourist destination once more and its lower-cost exports would zoom, instantly increasing competitiveness. And that’s what Germany can’t allow. Germany lured other European nations into the euro in order to keep them from undercutting Germany’s prices in export markets.
Restricted by the 3% deficit rule, the only recourse left for Eurozone debtors: pay the piper with “austerity” measures.
Tsipras in Wonderland
So therein lies the lie. Tsipras tells his fellow Greeks that we can live in a Looking Glass world, where we can have our euro and eat it too; that we can stay handcuffed to the euro but run free without austerity.
The nonsense continues: Following the announcement of the official results of the referendum on Sunday night, Tsipras tweeted that the Greek electorate voted for a "Europe of solidarity and democracy," while the now-resigned finance minister Varoufakis tweeted that "Greece's place in the Eurozone is non-negotiable," claiming that he would not allow the "only alternative," the old drachma trading alongside the euro.
SYRIZA's euro-fetish was already evident in its pre-referendum proposals to the IMF and European Bank, a 47-page document which included 8 billion euros in new austerity measures plus a new round of sell-offs of state industries, the maintenance of a primary surplus of 1% this year which would increase in the coming years, the increase of the retirement age to 67, and making permanent the previously "temporary" taxes upon an already overtaxed populace. In Tsipras’ own proposal, there was no word of a debt write-down or stoppage of payments, despite the fact that the government's own Debt Audit Commission announced on June 17 that the bulk of Greece's debt is illegal, “odious,” and should not be paid.
Instead, Tsipras has come out in support of the IMF's proposal for a mere 30% "debt haircut" and a 20-year grace period, effectively sweeping the problem under the rug. Greece is currently running a deficit, meaning that in order for the 1% surplus to be achieved, SYRIZA must cut, cut, cut. Exactly as Mundell and the supply-siders intended.
Death by “Reform”
Like Obama, Tsipras knows that cutting pensions, privatizing and closing industries, slashing wages – in other words, “austerity” -- or, to use the latest jargon, “reform” – is not just cruel, it’s plain stupid: it can only push a nation in recession into depression.
That’s not just theory. The Troika (the European Central Bank, IMF and European Commission) first imposed their vicious austerity measures on Greece in 2010. Greeks watched their annual salaries plummet to half of a German’s paycheck. Greece's supposedly generous pensions have been cut eight times during the crisis, while two-thirds of pensioners live below the poverty line. Everything from Greece's airports to harbors, the national lottery to prime publicly-owned real estate was sold off, while schools and hospitals were shuttered.
And, for the first time since World War II, widespread starvation had returned. 500,000 children in Greece are said to be malnourished. Students fainting from hunger in frigid schools which cannot afford heating oil is now a common phenomenon.
This cruel “belt tightening,” the Troika promised, would restore Greece’s economy by 2012 (and then 2013, 2014, and 2015). In reality, unemployment went from a terrible 12.5% in 2010 to a horrendous 25.6% today.
Now, the Troika demands more of the same, a continuation of this disastrous policy.
Crashing into Africa?
Meanwhile, following the referendum result which made him a hero, finance minister Varoufakis resigned. Ironically, while Varoufakis rubbed German officials the wrong way with his unorthodox style, he, too, maintained the pro-euro myth. Previous austerity measures continued under his watch. To please the mad austerity masters, he said he would "squeeze blood from a stone" to repay the IMF—which he did in May, when all remaining funds in the Greek Treasury were rounded up by presidential decree to make that month's IMF loan payment. Varoufakis was so wedded to the euro that he claimed that Greece would be unable to print its old currency, the drachma, because we destroyed our currency printing presses when we joined the euro. In fact, the government's banknote printing facility in Athens still operates, printing the 10-euro note.
Meanwhile, our future flees. A quarter million university graduates have abandoned our nation. They have no choice: unemployment for those under 25 has hit 48.6%.
I know that many Greeks, Cypriots, Italians and Portuguese all express a visceral fear of leaving the euro. Depending on which polls one chooses to believe, anywhere from a near-majority to an overwhelming majority of Greeks wish to remain in the euro at all costs. From the hysterical statements I heard from some Greeks that, “We cannot leave Europe!”, you’d think that dropping the euro will cause Greece to break off at the Albanian border and crash into Africa.
It would be refreshing to hear political leaders say the honest economic truth: “Workers of Europe unite! You have nothing to lose but the euro—and your chains.”
***
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Here’s how it works. To join the Eurozone, nations must agree to keep their deficits to no more than 3% of GDP and total debt to no more than 60% of GDP. In a recession, that’s plain insane. By contrast, President Obama pulled the USA out of recession by increasing deficit spending to a staggering 9.8% of GDP, and he raised the nation’s debt to 101% from a pre-recession 62%. Republicans screamed, but it worked. The US has lower unemployment than any Eurozone nation.