Greeks Reject Bailout Terms • Hacker News Board

Re: Greeks Reject Bailout Terms

#321

Post by jbapple » Mon, Jul 06, 2015, 2:06 AM UTC

cperciva wrote: post #317

jbapple wrote: post #315

Earlier quoted context omitted.

If Japan owes debt in its own currency, can it just print money to pay off the debt? If Greece can't devalue its currency this way, is its situation materially different by even just this fact alone?

If Japan owes debt in its own currency, can it just print money to pay off the debt? That's effectively what Japan is doing, by having its central bank loan money at 0.1%.

>That's effectively what Japan is doing, by having its central bank loan money at 0.1%.

Does that make it more conceivable that Japan will eventually pay down its debt?

Re: Greeks Reject Bailout Terms

#322

Post by cperciva » Mon, Jul 06, 2015, 2:18 AM UTC

jbapple wrote: post #321

cperciva wrote: post #317

Earlier quoted context omitted.

If Japan owes debt in its own currency, can it just print money to pay off the debt? That's effectively what Japan is doing, by having its central bank loan money at 0.1%.

>That's effectively what Japan is doing, by having its central bank loan money at 0.1%. Does that make it more conceivable that Japan will eventually pay down its debt?

Yes. Economists often refer to "explicit" sovereign defaults (where the debts don't get paid back) and "implicit" defaults (where the debts get wiped out by a policy of deliberate inflation or devaluing of the currency). Greece's inability to effect an implicit default is why they've ended up with an explicit default.

In the case of Japan, since most of their debt is held by residents, it's even a stretch to call this an implicit default; a better characterization would be "wealth tax effected by inflation". Either way, if the Japanese government could maintain a balanced budget, their central bank policy of flooding the market with Yen would eventually allow them to pay off the existing debts.

Re: Greeks Reject Bailout Terms

#323

Post by sooheon » Mon, Jul 06, 2015, 2:27 AM UTC

Natsu wrote: post #320

littletimmy wrote: post #314

What's most interesting to me in this entire crisis is the moral discourse surrounding debt. More often than not, you'll hear stuff like: "Of course Greece must pay its debt", "You mean to say you can just take money and not pay?", "Why should taxpayers bail Greece out?"... All the while, there is absolute ZERO condemnation for banking entities making risky loans. There is not even a tacit nod towards acknowledging t…

I guess that depends on whether you see making a promise you have no reason to believe you can keep is better or worse than being dumb enough to believe it.

Don't discount the third option, that creditors are neither dumb or gullible, but predatory.

Re: Greeks Reject Bailout Terms

#324

Post by sooheon » Mon, Jul 06, 2015, 2:30 AM UTC

brightball wrote: post #186

FlannelPancake wrote: post #139

Earlier quoted context omitted.

> This approach creates a more unified country because people are able to make their own decisions and live with them. I don't know why you would assume that: There's a whole host of tensions that come with decisions made at the state level. Reciprocity is a huge one that comes up semi-frequently (for example with firearm laws). > People are able to move within the country to states with policies more in line with th…

> This approach creates a more unified country because people are able to make their own decisions and live with them. >>I don't know why you would assume that: There's a whole host of tensions that come with decisions made at the state level. Reciprocity is a huge one that comes up semi-frequently (for example with firearm laws). There are and those get to be negotiated and worked out. The tensions arise, such as wi…

If you have the time I'm very interested to hear your response to FlannelPancake below (as a non-American).

Re: Greeks Reject Bailout Terms

#325

Post by CamperBob2 » Mon, Jul 06, 2015, 2:31 AM UTC

sooheon wrote: post #323

Natsu wrote: post #320

Earlier quoted context omitted.

I guess that depends on whether you see making a promise you have no reason to believe you can keep is better or worse than being dumb enough to believe it.

Don't discount the third option, that creditors are neither dumb or gullible, but predatory.

Well, they've "preyed" themselves into substantial losses. Even if the EU makes good on the principal on Greece's behalf, it was still a dumb idea to lend money to them.

Re: Greeks Reject Bailout Terms

#326

Post by fencepost » Mon, Jul 06, 2015, 2:32 AM UTC

brightball wrote: post #186

FlannelPancake wrote: post #139

Earlier quoted context omitted.

> This approach creates a more unified country because people are able to make their own decisions and live with them. I don't know why you would assume that: There's a whole host of tensions that come with decisions made at the state level. Reciprocity is a huge one that comes up semi-frequently (for example with firearm laws). > People are able to move within the country to states with policies more in line with th…

> This approach creates a more unified country because people are able to make their own decisions and live with them. >>I don't know why you would assume that: There's a whole host of tensions that come with decisions made at the state level. Reciprocity is a huge one that comes up semi-frequently (for example with firearm laws). There are and those get to be negotiated and worked out. The tensions arise, such as wi…

"The extreme example counter response is never far behind in political discourse. Civil rights / human rights issues are a different ballgame and those absolutely are things that need to be resolved at the federal level. There's a whole host of other policies that don't though."

The problem isn't whether you allow some things to be decided at the state level and some things to be decided at the federal level. The problem is this: WHO gets to decide what level is correct?

There's a very large portion of the US that feels that voting rights issues should be decided at the state level. Same with abortion rights. Same with firearm ownership/possession. Same with gay marriage (and reciprocity is a big one there). I'd lay odds that if not for that pesky meddling Federal Government there's at least one state with a legislature that would be willing to ban miscegenation again, and refuse to recognize marriages that wouldn't be legal in their state.

Re: Greeks Reject Bailout Terms

#327

Post by CamperBob2 » Mon, Jul 06, 2015, 2:35 AM UTC

brightball wrote: post #32

yc1010 wrote: post #3

Fairplay to them, the whole point of the EU project was to make us all "Europeans" and to prevent constant disastrous fighting between states and people of the continent. Sometime in the last 10 years many people and the media in the "core" countries got all smug and uppity towards those lazy "peripherals" and so on forgetting exactly why the project was started, overnight we stopped being "Europeans" and became "und…

It's a similar issue that we see in the US. There are a number of people (and the entire Constitution) that pushes for state level decisions unless it's absolutely necessary at the Federal level. This approach creates a more unified country because people are able to make their own decisions and live with them. States are able to compete economically. People are able to move within the country to states with policies…

The cognitive dissonance is maddening.

It's a little more complicated than simply accusing the other party of cognitive dissonance. There actually is a right answer and a wrong answer to some of these questions.

K-12 education, for instance, has no business being a state-level issue. It is grossly unfair if a kid in New York learns about evolution while her cousin in Texas learns that Jesus rode a dinosaur to work. (Especially considering the disproportionate influence that Texas has on the textbooks that every other state must buy.) Yet Federal control of educational standards is one of the most contentious issues of all.

Re: Greeks Reject Bailout Terms

#328

Post by TheMagicHorsey » Mon, Jul 06, 2015, 2:41 AM UTC

calibraxis wrote: post #125

paskster wrote: post #59

Earlier quoted context omitted.

I am very pro Euro. But I don't like the fact that a single country in Europe feels that 18 other countries have to pay their debt. These bailouts in the past were signed from the greece government in the best interest of its people. A lot of people make it seem that we (non-greece european) somewhat forced theses agreements onto greece. In fact these bailouts where were unpopular in Germany, because it cost us a lot…

Greece among others pardoned your Nazi debts and reparations in 1953, helping you rise. Greeks did nothing so terrible to "owe a debt". You owe them a debt which is far stronger than promises ("debt") held by investors, part of which was from the dictatorship and therefore odious debt. Piketty: "When I hear the Germans say that they maintain a very moral stance about debt and strongly believe that debts must be repai…

Greece must stop spending 50% of its GDP on bloated government bureaucracies. That is the bottom line. More money stops them from taking the hard steps.

Greeks make nearly nothing that anybody wants, but they want the goods everyone else makes. They are not adjusting themselves to the realities of the modern world. You want cell phones, computers, cars, shoes, t-shirts, refrigerators ... all these things ... but you want to not actually make anything ... just sit at desks in secure government jobs doing nothing productive. This has to stop.

But politically there is no will to stop it, because people there don't seem to understand that secure, easy jobs for life, where you don't make things, don't actually create wealth for the country. They think jobs are some thing where you just show up in the morning for work, do some paper shuffling and go home at night. And get your secure paycheck from government.

How do we change this attitude? The same attitude is in India's public sector too. The way is you have to cut off the money faucet for the government.

If the issue is poverty in Greece ... then let Europe provide basic needs for the Greek citizens as they reorganize the country. But feeding the Greek bureaucracy really shouldn't be done. Also continuing to perpetuate this attitude towards what employment is and what jobs are should also not be done.

Re: Greeks Reject Bailout Terms

#329

Post by brightball » Mon, Jul 06, 2015, 2:42 AM UTC

CamperBob2 wrote: post #327

brightball wrote: post #32

Earlier quoted context omitted.

It's a similar issue that we see in the US. There are a number of people (and the entire Constitution) that pushes for state level decisions unless it's absolutely necessary at the Federal level. This approach creates a more unified country because people are able to make their own decisions and live with them. States are able to compete economically. People are able to move within the country to states with policies…

The cognitive dissonance is maddening. It's a little more complicated than simply accusing the other party of cognitive dissonance. There actually is a right answer and a wrong answer to some of these questions. K-12 education, for instance, has no business being a state-level issue. It is grossly unfair if a kid in New York learns about evolution while her cousin in Texas learns that Jesus rode a dinosaur to work. (…

I don't consider it a "other party" issue. At this point I very much consider it a both party issue.

Re: Greeks Reject Bailout Terms

#330

Post by Lazare » Mon, Jul 06, 2015, 2:44 AM UTC

littletimmy wrote: post #314

What's most interesting to me in this entire crisis is the moral discourse surrounding debt. More often than not, you'll hear stuff like: "Of course Greece must pay its debt", "You mean to say you can just take money and not pay?", "Why should taxpayers bail Greece out?"... All the while, there is absolute ZERO condemnation for banking entities making risky loans. There is not even a tacit nod towards acknowledging t…

> All the while, there is absolute ZERO condemnation for banking entities making risky loans. There is not even a tacit nod towards acknowledging that if banks make loans that fail, it is their loss to eat.

Not sure you really understand the situation. Everything which you said "isn't happening" already happened. There was already a massive haircut on privately held Greek debt (but not the publicly held greek debt), and the banks already ate a huge loss. Something like 80% of Greek debt is now owed to the "troika", with much of the remainder held domestically.

The reason that EU governments focus on debt repayment, and why people talk about taxpayers is because they own the debt, and it's their taxpayers who will eat the loss.

> Not a whisper about how taxpayers have been surreptitiously bailing out banks, and not Greece.

Probably because that didn't happen. Private investors lost something north of 75% of the value of the loans they've made; what haircut has the IMF or French government taken on their holdings of Greek debt? (Hint: Zero.)