Varoufakis is all-but-officially out of a job already.
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Varoufakis is all-but-officially out of a job already.
http://news.yahoo.com/greeces-credit...094226567.html
Was there been a more incompetent government in a Western country in the last half century?
Yes, many of the ones who came before and got Greece into this impasse were worse. Its its more obvious with these guys as there's no room for error left.
At least those guys had a plan (boost economy now and hope it doesn't crash until the next guy is in power). The current government is just completely useless.
Greece is not paying today (Friday's) IMF payment on time. Using a rule last used by Zambia in the mid-80s to bundle all payments for the month together so they essentially have kicked this over until the end of June now.
I'm sort of thinking default might just be the best outcome for all concerned now. Let Greece start rebuilding as a bust quasi-third world nation rather than pretending to be equal to Germany and end this perennial nonsense. I thought that was what Syriza were pledged to do but instead they just seem to be stringing along from deadline to deadline extending bailouts while saying they don't want bailouts, acquiescing to conditions while claiming they won't. This is the worst of all worlds.
Syriza is just more of the same. I'm totally in favor of not even trying any longer.
Looks like Merkel is more in favour of trying than you are. Seems she's willing to continue to kick the can down the road in exchange for just one reform from Greece: http://www.bloomberg.com/news/articl...ed-deal-on-aid
Yeah, I guess we'll magically will have an agreement extending the present package till some time in 2016. After which we'll have another round of this farce.
The sound of politics in action!
Then in early 2016 you'll have an extension until late 2016, in late 2016 it will be kicked to 2017.
Though if Greece runs a small surplus every year without ever running a deficit it is only going to take kicking this until 2065 before the debt is a manageable level. What could possibly go wrong?
Someone somewhere must be getting dizzy from all the u-turns and spinning around on this. 24 hours after this was apparently being kicked to next year, the IMF are now threatening to walk away. I hope someone is willing to call the Greek's bluff this endless can kicking is silly: http://www.bbc.co.uk/news/world-europe-33099000
They aren't really away, they're just not negotiating any longer. The second the Greeks finally sign up to the deal the IMF will be back to confirm their support. The 'withdrawal' is just a signal to the Greeks that there are no more points to be won in this round.Quote:
Originally Posted by RandBlade
That's why I said threatening to rather than have walked away ...
Be interesting to see if the Greeks fold now or act like the IMF is bluffing. Is this serious economics or high stakes poker?
Seems like everybody is getting the hang of this 'negotiating by walking away'-thing.
Very good news today; the Greek crisis has been solved. The Greek parliament has come to the conclusion that since all Greek debt is 'odious' Greece is under no obligation of repaying any of it.
Problem solved, Grexit is no longer necessary.
Has anyone declared the Greek parliament to be odious yet? :o
Seems like we're going to see on monday.
What's quite boring in this whole debate are people blabbering on about debt relieve as the way out of this whole situtation. Greece's debt is only theoretically crushing as the country is actually not servicing its debt. I also think there are few people in Europe, if any that believe Greece will pay back everything that it has borrowed. What we are terribly worried about is that Greece, if we let it do what it wants will simply continue not playing by the rules, run up another bill of a huge amount in a couple of years after which we're simply going to have a re-run of the present situation.
I think the present Greek government will have itself and nobody but itself to blame if the crisis results in a ejection of Greece out of the Eurozone and maybe even the EU. If they hadn't started by demonstratively tear up a rulebook they had been trying to not follow for the last couple of years but in stead had shown that they were indeed a different kind of government than the previous ones, they could have gotten all they claim to want now and then some. Now they have painted everyone in a corner where even giving in on details will be interpreted by voters on both sides as a capitulation that will be harshly punished at the ballot boxes.
If Mrs Merkel wants to be out of a job by this time next month all she needs to do is give the Greeks their way in no longer involving the IMF in the bail out mechanism. The interesting thing of course being that actually the IMF should never have been involved.
Funny I think you and I are on the same page a lot more lately lol. The Greeks are paying a pittance in interest and even their debt:GDP % is only bad as GDP is utterly messed up currently. If they took just a few smart steps this crisis could be history in relatively short order.
I think it's incredible what's happening as we speak; the Greeks have not submitted a single serious proposal and we're supposed to look the other way as we sponsor the Greek deficit with NEW money to the tune of €1-2 billion a day? I think Mrs Merkel is really underestimating the amount of shit that will hit the fan once the wider public understands that they are being robbed blind as we speak.Quote:
Originally Posted by RandBlade
So far €30 bn in ELA for which there is not even a semblance of a democratic mandate but for which the tax payers in the rest of the eurozone will be liable.
Regrettably this is what has happened to most historical currency unions which aren't political unions, but its happening much quicker than I think anyone could have predicted. I'm surprised just how much money the ECB is burning through continuing to support Greek banks that would clearly be insolvent were it not for the ECB. Its a bizarre scenario where the ECB is not supposed to lend to insolvent banks but can indefinitely it seems lend billions to the Greek banks because they're not insolvent only due to the ECB's loans. Its a circular paradox.
This is a post I wrote on an English politics blog yesterday (so its a bit Anglo-centric with its references) prior to our posts yesterday, in response to claims the Eurozone nations need to give debt relief to the Greeks as their debt is unmanageable. It isn't, it is the actions of the Greeks that are the problem.Quote:
There is no reason the debt can't be managed. Debt doesn't have to be repaid immediately as this is a national debt not a payday loan - the repayment and interest loan schedule has to be met. After all the bailouts the loan schedule Greece has is based on incredibly, incredibly generous terms. Interest costs are only 3% of GDP (lower than most countries with much lower debt rates). That is neither exhorbitant nor unreasonable. Plus this is based on a very long maturity for most of these loans.
If Greece took a few sensible decisions like raising retirement ages away from 50s and making labour reforms that allow the unemployed to work instead then then there is no reason growth couldn't return and these payments could be met. All they have to do is cover the incredibly generous interest portions in the meantime.
If GDP/capita could be raised from current Greek levels to current British levels (even without counting future British growth) then that would transform debt from 180% of GDP to being "just" 90%.
Greece needs a Thatcher and instead it has a Foot. That is the problem.
It's not realistic though to think that Greece in the forseable future will be able to have growth levels high enough to make the debt sustainable in the long run. However, starting with debt relief is giving off the wrong signals; what the Greeks need to do is make a real start with liberalization of their economy. What struck me in one of the many pieces about 'real life in Greece' was that a liter of milk costs €1,20 in Greece, that's about double the price a liter of milk costs here in Amsterdam.Quote:
Originally Posted by RandBlade
Now Greece is promising more taxes on the rich. What the hell is wrong with Tsipras? The problem is the inability of the Greek government to actually collect taxes. Doubling nothing is still nothing.
Greece doesn't have generous terms on its debt just for the foreseeable future. Greece has an absolute bargain low rates to deal with until 2055!Quote:
Originally Posted by Hazir
http://graphics.wsj.com/greece-debt-timeline/
Greece has 40 years of incredibly generous terms that they simply don't deserve. There is no reason that by 2055 Greek GDP couldn't double what it is now (or equivalent to today's British GDP/capita, let alone 2055's GDP).
Wow, I pay £1 (€1.40) for a 4 pint (2.27 litres) bottle of milk. If I shopped at Aldi, Lidl or ASDA then I'd pay less for 4 pints than the Greeks do for 1 litre.Quote:
Originally Posted by Hazir
And another emergency meeting in Brussels now that the IMF has deemed the Greek offer insufficient. The IMF appearantly has said it's too dependent on tax-increases that will only harm the economy (and cause a worse debt-ratio).
Then shouldn't it be just collect the original taxes? ��
That could be part of the solution, rather than strangling the economy with more taxes (or the threat thereof). More important than anything Greece needs to put the ax to its virtually marxist controls of the economy. it's hardly ever a good thing if the state tries to micro-manage sectors of the economy.Quote:
Originally Posted by Veldan Rath
Greece is going to hold a referendum on a bailout.
I'm going to hold a referendum on whether I should pay my taxes. I'm the only voter.
The Greek Ballot Paper has been leaked:
Have cake [ ]
Eat it [ ]
All voters get two votes.