81–90 of 249 posts
Here is what I want to know. What role does the Greek central bank play? What is the fractional reserve rate in Greece? What is the interest rate set by the central bank? How is the money generated in the first place and what are the return rates and restrictions on that method (eg: in US it's treasury bonds)? I'm increasingly convinced that central banks operate only marginally on the interest of the country they se…
Most of you, dear Handesblatt readers, will have formed a preconception of what this article is about before you actually read it. [...] Prejudice was never a good guide, [...] How does he not hear himself? Also, "Handelsblatt" is missing a letter. Anyway ... I reject the premise of his letter. He seems to think the purpose of the money was to help the greek people, and offers a more productive way of doing so. That'…
Earlier quoted context omitted.
Well, no. The fundamental problem is that Germany has been treating the rest of the EU as an expedient export market while refusing to allow equivalent imports, and at the same time aggressively insisting that countries in the EU should somehow magically not need debt... to continue buying from Germany. There's also the minor point that this is yet another excuse to indulge the usual neoliberal hatred of social spend…
> while refusing to allow equivalent imports That very much is in citation needed territory, please give at least one example of how Germany is refusing intra-European imports in any category. Free trade is one of the cornerstones of the EU, Germany imposing a tariff or blockading goods produced elsewhere in Europe would make some pretty fat headlines.
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UK.gov will turn a profit on RBS. RBS is not a loss.
Getting the government to bail out your failing business? Sounds like a big win for the business. *Note. I don't know the details of the RBS issue in the UK. Just commenting on a simple interpretation.
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> populist clowns Calling a dissenting party clowns is not helpful. It's also wrong, since they argue their points well and their economics are backed by such people as Paul Krugman. Now you might disagree with him, but would you call him a clown, too?
Paul Krugman is overrated, and you're drastically simplifying to say he's backing their economics. I'm mostly calling them clowns for the disservice they do their own cause by calling debt repayment economic waterboarding.
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The real problem is that Greece - especially under it's new leadership - will very soon generate new astronomical debt if the current one is forgiven (paid by someone else). Lenders would be silly not to lend if they know the debtor will be certainly bailed out and actually Tsipras would be silly too not to finance his communist utopia from debt if he too knows Greece will be bailed out no matter what.
Forgiven debt is not "paid by someone else". It's a write-off by the creditor. Creditors would likely not write off a bunch of debt and then lend Greece more money. Now, if the bailout actually paid off the creditors and Greece now only owes money to, e.g., Germany (the IMF, etc), then sure, the original creditors might extend new loans to Greece if Germany forgives the Greek debt. But then, that could happen anyway,…
Sure. I agree that (morally) the EU shouldn't have bailed out Greece. Greece cooked its books and Greek debt holders at the time of the bail out were suffering the consequences of lending to a fiscally irresponsible state. That being said, the world was uncertain as to how much economic damage had yet to be done, and by shoring up Greece it assuaged investor confidence across the western world. Personally I think tha…
Greece may have cooked the books but the rest of the EU is complicit in not doing their due-diligence in their haste to include Greece in their attempts to declare 'largest economy in the world'. It was a stupid pissing-match and the EU definitely carries a fair chunk of the blame here.
Greece was among the first countries to join the EU (the fourth one if I count correctly) and at the time, the EU (actually, the EEC) was still rather far from being the largest economy in the world.
It was actually more based on the historical and cultural place of Greece in Europe than economical grounds, as well as a way to help them recover from the previous dictatorship.
Most of you, dear Handesblatt readers, will have formed a preconception of what this article is about before you actually read it. [...] Prejudice was never a good guide, [...] How does he not hear himself? Also, "Handelsblatt" is missing a letter. Anyway ... I reject the premise of his letter. He seems to think the purpose of the money was to help the greek people, and offers a more productive way of doing so. That'…
> Germany is one of the riches countries on this planet. A lot of that riches comes from the fact that EUR is a common currency both of economically successful countries like Germany and of economically weak countries like Greece. That makes the currency artificially undervalued, which boosts German exports and hurts Greek imports, making Germany more competitive and Greece less competitive (longer comment: https://n…
> I think it's time Germany admits to that and pays its dues, by which I mean help finance the rest of EU (via a fiscal union).
Do you really think we don't know what we're doing? You say we need to "pay our dues". You do realize we're talking about the fact that Greece can't pay it's dues, yes? As far as help financing the rest of the EU goes, keep on dreaming. There is no way any german is going to vote for that given that we have plenty of kids growing up below the poverty line.
Earlier quoted context omitted.
Well, no. The fundamental problem is that Germany has been treating the rest of the EU as an expedient export market while refusing to allow equivalent imports, and at the same time aggressively insisting that countries in the EU should somehow magically not need debt... to continue buying from Germany. There's also the minor point that this is yet another excuse to indulge the usual neoliberal hatred of social spend…
Your statement about Germnay refusing to allow imports is manifestly false. The EU is a free trade area and its member states are not permitted to engage in such activities. The EU has its own courts to enforce such rules. It's certainly true that Germany is a net exporter: this is because of their ability and competitiveness in engineering and technology, combined with the fact that Germans are not big consumers and…
This one sentence sums up what I think is the fundamental problem: "An insolvency problem was thus dealt with as if it were a case of illiquidity." That is, the problem isn't some ephemeral panic where people are temporarily unwilling to lend. The problem is there are massive capital losses that have yet to be acknowledged. The problem is that Euro politicians believe that by continuing to bankroll Greece they will s…
> "continuing to bankroll Greece" What are the EU treaty obligations in this regard? Is this still undecided? Is it a "corner case" that was never really spelled out how to handle it?