321–330 of 350 posts
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If you are willing to accept payment in land, it's quite easy.
I don't often hear war as described as "easy". I don't think any of Greece's creditor nations are willing to start a shooting war over a default.
I'm not qualified to judge whether Piketty is correct but I can offer this analogy. In the past, when I have loaned money to friends and family, my attitude was "kiss the money goodbye". If the money was spent wisely and served a useful purpose, I was happy. It's nice to get repaid, but it's not essential.
So it's not about getting money back, it's about not burning more money.
So I've been vaguely following the Greece and Puerto Rico situations (the Greece situation is causing me to put some trading strategies on hold), but there is something I don't understand about it. How come so many left wing advocates (Piketty, Krugman, etc) are coming out advocating for Greek bailouts?
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Well… I don't really know the ins and outs but Angela Merkel seems to be the primary spokesperson and negotiator for the Troika. I'm not sure how/who provides the funds for the ECB & IMF. I think it's ultimately Germany too. At least the German public seem to believe they are on the hook for and troika loans that aren not repaid. The reason Germany have a particular interest/power here (apart from being a large euroz…
Germany does pay the most in absolute terms. This does nothing to the fact that the Troika is not mostly German. I do not think that HN is a place for these kinds of polemic arguments. Lets leave them to the right wing eu-critics that try to built up enemy stereotypes. Angela Merkel is not part of the Troika. Angela Merkel plays a prominent role in the debate because she is the unofficial leader of the northern state…
Also, there is more to it than polemics. I think Germany's political traditions and biases largely driving these policies and also their interests (as direct lenders and as the country housing the interested banks). Angela Merkel is not officially part of the Troika, but her role in it is still real. Germany underwrote loans.
You are right that it's not strictly true. But using the terms Troika or listing the institutions isn't more true, it's obfuscating. It's not clear what those acronyms mean.
I'm also not right wing (or left). I'm critical of the EU, but I care because I want it to succeed. I disagree with a lot of technical aspects but I am wholeheartedly in favor of the true goals of the EU: solidarity and peace. I believe the EU will give us our first 100 years of peace and our second.
Germany was rescued after WW2 to drive the European economy. Without German exports the continent would have had no chance to recover. It's sure ironic that Germany first destroyed the continent and then profited by rebuilding it, but history doesn't seem to care about irony much. I think the 'Germany never paid'-argument is flawed. The Marshall plan would not have worked if Germany had been indebted. Instead this ha…
If Greece was not on the Euro, it would simply print money and inflate its currency until it could easily pay off it's debts. That gives you the same result as what Germany did, which was to basically only pay off some of their debt and just forget about the rest. The debtors lose, but hey, that's the risk for loaning money, right?
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You hear the claim annoyingly often.
I am still new here but as far as I understand upvoting is not the same as agreeing.
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I believe you, but could you flesh that critique out some more? My understanding of Greek's fundamentals start here: http://pseudoerasmus.com/2015/02/23/greece-orthodoxy-peronis... (this was linked from the Interfluidity thing everyone was talking about before) and continues through here: http://www.imf.org/external/pubs/ft/scr/2015/cr15165.pdf (which I read when someone claimed Greece had a 2014 primary surplus, whi…
Hope the following helps, I think we all are trying to learn as much as possible about this as it unfolds. I thought the article about Peronis Democracy was interesting but I need some help seeing the connection to the current crisis. Judging from your comments it seems like you believe the Greek government is spending more than it's taking in(primary budget deficit). Which is not true at least for 2014 according to…
The IMF analyzed the 2014 primary surplus and found it illusory:
* They counted revenue sources that aren't conventionally accounted for in primary budgets
* They undercounted liabilities, notably from tax refund and pension payables
* Some of the unorthodox revenue they counted were privatization proceeds, which turned out less lucrative than projected
The IMF's trued-up numbers suggest there was no 2014 primary surplus.
At the risk of being a moralizing bore, may I remind everybody that "Germany", "Greece" etc. are not people, and that people are not countries? I am surprised by the national coloring, however faint, of some comments here and there https://news.ycombinator.com/item?id=9834721 . "I am a German" or "Greek here" should have no relevance to the ideas put forth. "Your money" and "your banks" are not really "my money" and…
> The theory of complex systems reminds us that aggregates can have properties that are not traceable to any individuals themselves. Game theory tells us that incentives and constraints can get so messed up that developments take on an eigendynamic which was nobody's intent nor interest. I'm interested in those ideas. Can you give a link to any information about them?
Germany was rescued after WW2 to drive the European economy. Without German exports the continent would have had no chance to recover. It's sure ironic that Germany first destroyed the continent and then profited by rebuilding it, but history doesn't seem to care about irony much. I think the 'Germany never paid'-argument is flawed. The Marshall plan would not have worked if Germany had been indebted. Instead this ha…
That Wikipedia article says that Germany did not fully pay its debt to Greece. So, I don't see your point. If Greece was not on the Euro, it would simply print money and inflate its currency until it could easily pay off it's debts. That gives you the same result as what Germany did, which was to basically only pay off some of their debt and just forget about the rest. The debtors lose, but hey, that's the risk for l…
Anyways if Greek was not in the Euro it could devalue its currency. Which would benefit their exports, if they had any. However their debt would still be payable in Euro and the new currency would have a terrible exchange course. So no win. There are scientist who say the real estate market might boom in such a case. Since most Greeks are home owners that may provide some cash in the short run: International investors and rich Greeks who transfered their assets out of the country before the crash will buy in.
It's still unclear if a state can actually default. I guess if you're not dependent on import you could risk not paying back your international partners(/enemies). There are examples of countries regaining some power in isolation.
I agree about the risk of lending money, that's probably the reason why so much of this money was used to decouple Greece finance market and ensure existing (private) contracts were honored.
"Germany is really the single best example of a country that, throughout its history, has never repaid its external debt. Neither after the First nor the Second World War." Actually I remember an article posted a while ago right here on HN about the last payments for WW1. It is possible that Mr. Piketty may not have updated information, but it is also possible that he deliberately ignores some facts in order to stir…
This one http://www.bbc.com/news/world-europe-11442892 ? "By the time country was reunified, in 1990, the world had changed dramatically since the days of Versailles, and policymakers decided to write off most of the original sum." So he's still correct.
It was a similar article.
"So he's still correct."
The Germany's case was very, very different than that of Greece. After the both wars the winning forces just dictated the sum and the loosing forces had very little saying in the mater. It was most likely an exaggerated figure to start with, probably out of PR reasons - "we made them pay, dear people!" Later, when the emotions faded for the most part, a more realistic figure could be put in discussion and sold to the wide public as an act of generosity. Now let's talk about Greece and how many parallels can be drawn here. Greece was not being dictated figures of debt, Greece took the money willingly. Well, one could argue that only a small political elite made the decisions, but the money were actually reaching the average persons too, as budgetary salaries and pensions (and I bet they all enjoyed it). Write off some of the debt? There's no real reason to do that (but if that would be what it takes to bring them to saner fiscal practices, I would be OK with it anyway). So, Mr. Piketty may be "correct" in some twisted view in which paid-in-full war compensations are not actually recognized as such¹ and more importantly - he wants to be correct in an even more twisted context that puts on the same footing a subject of dictated-upon debt and the one of self-inflicted debt.
¹ Because the war winners have chosen later to adjust low the asked war compensation, and by doing that they manage to morally deny the "repaid" status. They could however have managed to achieve just the same by adjusting high (i.e. continuously calling for higher and higher sum so that it could never be paid in full).