Will Greece exit the Euro? (Thread now a poll)

I'm not sure if I can agree that the Greeks were 'taken advantage of'. BUT, I do agree the Banks are predatory... and they do lie.

Think of it like this. A fiend of mine bought a house right at the very very peak of the housing bubble. I mean, he threatened to sue his bank for 5 months trying to get this loan. Finally he got it. Then he organized to do work from home (he was supposed to be doing his JOB - what he really did was to move in and fix up his new house. He did NOTHING he said he was going to do [welcome to the public service]). Imagine getting an 8 month vacation - that's what he got. Anyway, so when I finally saw him again, he told me all about the great vacation (another 'real' vacation) he had planned. AND he deserved it - I mean, after all, he's had a tough year. How was he going to pay for it I asked? I mean, he took out a HUGE mortgage.

Guess how?

Yup, he was trying to borrow against his home! This guy is so out of touch he didn't know that bubble popped years ago! This dumb ass didn't know his house has dropped over $50,000 in value since his first quotes. Which is why the bank didn't want to lend to him. Yeah, then he starts bitching how "the government" is screwing him. The "bank" is screwing him. AND those politicians really need to do something about this market. blah blah blah....

Yeah, I asked him what he thought about where that money comes from for his vacation.... That he was really paying for his vacation now (which he didn't end up taking because all his money goes into his mortgage) out of his childrens' future earnings. I rattled on some more, he looked at me cross eyed. I said: Don't you think about these things? He said: I really couldn't be f*cked.

(..........thinking)


I don't really feel sorry for people like this. No one HAS to take the money and go on a shopping spree. No one is forcing anyone to do that. We're supposed to work hard, save, invest. AND MAYBE have a vacation after we've taken care of bills and put a little away. Society is upside down. AND I think people know what they're doing is wrong. Even if it never bubbles up to a conscious level. AND if they don't - they'll soon learn.

I wonder what's going to happen when it flips back around - which it's about ready to do.

 

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And who is it that did that here, exactly? Are you just repeating your favorite slogans without bothering to work out who, if anyone, they even apply to?

That's not how loans to sovereign governments work. Greece isn't some individual homebuyer who took out a home loan and put the house up as collateral. There is no reposession clause in these debts - if Greece doesn't pay, all that happens is that banks become wary to loan them money in the future.

Since when?

Recognizing that your criticisms are ignorant and muddled, and your proposed solutions totally backwards, is just that. It doesn't imply that I approve of everything you disapprove of, and vice versa.

Your private central bank quote below? What does that have to do with Greece? This is an issue of sovereign debt and misaligned fiscal policies due to a monetary union with disparate members.

Yeah, financial crises have lots of bad effects.

But then, those US companies should have done their due diligence in evaluating the exposure and liabilities of the German banks they dealt with. No?

That's not really how it works. If it comes to that point, Greece will be unable to borrow and their retirement system will simply collapse. And nor will US taxpayers be sending any money to Greece.

Inflation is quite low in the USA lately, if you hadn't noticed. Higher these days than the last few years, but still historically low.

Don't put your strawmen in my mouth. What I did was point out how totally inane the conflation of taxation and theft is.

You haven't shown how centralized banking particularly figures into this issue. It's just "finance crisis = banks bad!" Try doing some actual reading and thinking, and less repeating half-considered slogans here.

 

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A Greek exit from the Euro is looking even more likely. A run on the banks may already be starting. And the British firm De La Rue has seen its stock rising over rumors that it might get the contract to print The new drachma.

 

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Yes it has. On Monday about 900,000 euros were taken out of ATMs. I would take long odds against me and bet that right now there are people sleeping in front of ATMs in self organized lines waiting and hoping that the bank will restock the machine with cash (euros). That is exactly what happen in Argentina when it defaulted.

About nine or 10 years ago, when it looked like LuLa, the radical leader of largest labor union would get elected (his fourth try) to the presidency of Brazil, the wealthy Brazilians were desperate to get there money out of the country. Lula had said he would repudiate Brazil´s debts, freeze bank accounts and seize the excessive fortunes, etc. Many rich had money they could not explain any legal origin for. Some gave me on average about 5 Real for each dollar I gave them until I had no more dollars.


Fortunately Lula´s wild statements was just to get elected - he is very smart and did install very good economic policies. (Unfortunately he did nothing about the corruption - it even grew worse under Lula, with monthly payments to congressmen by the government or donors if they voted as Lula´s party wished!)

 

quadraphonics,

Lets start again here.
- We agree the Greeks did borrow the money?
- We agree the German Banks did lend the money?
- We agree the Germans do deserve to be paid back their money?

Yes?

Where we do not agree. You seem to think that drawing pretty lines in the sand and calling it "Greece" or "German" and naming a loan a 'bond' somehow means ... what? That Greeks don't 'have' to return the goods they borrowed to purchase and did not pay back? Why? They do have to pay or they have to return the items and the banks makes a loss on the difference. That's basic morality. It works for people as well as groups of people ... even if you refer to that group as a 'Nation".


Second, do we agree "Corporations" are immoral? I mean, the notion of a Corporation is immoral as it shields the assets of the owner from that owners actions. Which is the whole reason they were created. The rich lobbied congress they needed a Legal Shield. Thus came the concept of "Corporation". Prior to this, when the CEO did something illegal, it was his property and money and assets that where first to go.

Now that you can see the selling of future labor by the government in action, do you have any problems with this at all? I mean, here it's clear to see that the flagrant spending of one generations pleasure passed on to their children is immoral and disgusting... and also legal and democratic. The same thing is happening to YOU by YOUR government. You're children are going to pay for those 'free' roads and bridges and water. AND they'll do so with interest. That housing bubble? Yup, they'll suffer for that too - not just them, their children will pay through the nose, have less chances in life, live with less educational access, less medical access, high tuition fees, along with everything else - including their taxes. But hey, YOU get to have 'free' medical care.... I mean, that's only "Civilized". I find this way of doing things utterly perverse. It's sick in the mind. AND people are fully aware. How many times have you or people you've known told you about a great tax write off? Did you use it? Did you pass the buck onto someone else?


Moo! Moo mooo!

 

Yes, once in most US states the owners and stock holders of banks were liable for up to twice the sum they had invested, if there were losses or complete bank failure.

This ended in 1933 when the FDIC was created, in large part because this twice your investment liability system proved not to work - people lost their saving as the rich guys found ways to avoid taking the losses. Now all the tax payers are liable for the failed bank losses. (Or the stockholders if bank survives - e.g. JP Morgan´s recent 2 billion loss had no ill effect on the CEO, who is also Chairman of the Board, voting on his salary and bonuses but stockholders took a beating.)

This is an early example of what is now common policy in US economics: The gains / profits are private* and the losses are socialized cost to all; and bank or corporation failure should not interfere with the CEO´s million dollar bonuses (or the lawyers being first in line to collect from any salvage sales when bankruptcy occurs).

* For example a lot of money was made in "no money down" / "no income checks" mortgage writing and placements commissions, and then again when those mortgages were packaged into trances that were re-sold, with AAA ratings, to not very careful investors who foolishly trusted the AAA ratings. None of those profits have been recovered to help the tax payers eat the losses of the "toxic trash" these fast operators made.

The new (post 1933) system works very well for the already rich. - They keep any profits and J.Q. Public eats any losses. This of course, encourages excessive risk taking, which increase the losses for J.Q. to eat. Ain´t Capitalism Grand,

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:shrug: when the already very rich write the laws, (via their lobbyists) and pay "campaign contributions" in cash under the table at lunch with a Congressman in a fancy DC restaurant. The US has the best government money can buy:
Of the corporations, For the rich, & By their lobbyists! Although it ain´t what the founding fathers planed for us.

Greece is showing us what is the end result (chaos & anarchy) of a few rich and powerful exploiting the state to get very rich. A collapsed dollar is the ONLY way the US´s ever growing debts can be paid. ("growing out of debt" is not possible because: (1) US is not growing in real (inflation adjusted) terms and quite likely to be back in recession before end of 2012 if there is no QE3 (by some changed name), (2) Too much of the debt is indexed to increase (Social Security payments, TIP type bonds, etc.) (3) Before end of 2014, the interest rates on the debt will be increasing - according to the FED´s plan. I. e. the interest costs of the every greater debts will be ever greater; rapidly soaring after China stops buying Treasury paper. - They are already reducing the Dollars in their reserves. - About 10% in the last 6 months!, (4) As China et. al. refuse to "roll" maturing debt - that requires re-payment with ever more printing press dollars issued by the FED, which is already the largest holder of Treasury´s paper promises.

Please don´t post attacks on the messenger who has been telling these sad truths for more than five years.

 

Of course.

They are contractually entitled to be paid what the loans specify, unless the borrowers decide they'd rather suffer the penalties for defaulting. That's how loans work. It's a business transaction, not a moral claim on Greece.

If the German banks failed to accurately assess the risk of a Greek default, and furthermore don't have enough assets to withstand such a default, then they were foolish and negligent and deserve to go out of business. That is the rule of the free market, no? If that failure would be too painful for us, and we instead prefer to bail them out rather than suffer their loss, then that is likewise our prerogative, and we have nobody to blame but ourselves for our situation.

If the Greeks overestimated their ability to repay loans, and furthermore borrowed so much that it's preferable to suffer the penalties for defaulting rather than try to pay, then that's exactly what they should do. If they willfully misrepresented their ability to repay loans, then they deserve some further measure of punishment for fraud, which should presumably go towards reducing the losses suffered by their lenders.

But, short of any demonstration of fraud or other illegal behavior, none of the parties to the mess have anyone to blame but themselves. The free market is all about personal responsibility, right? So why are you in such a rush to find someone else to blame?

As detailed above, it's the same as any loan transaction. There's always some risk of default, and some penalty for such, and both sides are expected to take that risk into account when deciding to go ahead with the transaction.

There are some further details of how exactly that works for sovereign debt vs. private debt within a sovereign state, but the basic principle is the same.

The Greeks have to either repay the loans as agreed, or suffer the penalties laid out for failing to do so. That's just business. If the Germans don't like the prospect of the latter, well, they can either go back in time and decide not to make the loans, or they can suck it up and write down the loan to something Greece can cover. That's how the free market works. It isn't about moral entitlements, it's about contracts and risk management.

There's nothing to "return." The borrowed money wasn't used to finance the purchase of cars or houses or durable goods like a consumer bank loan. It was mostly paid out as salaries and benefits. If the Germans wanted some kind of collateral to sieze in the case of a default, they should have written that into the loan contracts as a provision.

LOL what? No.

Again, weird to hear this kind of radical socialist stuff coming from a Paulite Libertarian.

Incorporation doesn't shield anyone from the consequences of illegal actions. It just shields the owners' assets from siezure if he makes bad business decisions and the corporation goes belly-up. His money can perfectly well be siezed in a criminal proceding if he breaks the law to get it.

They'll also benefit from them. So?

There is no policy on the table that gives anyone free healthcare. I can't imagine what you think you're talking about.

Obeying the tax code accurately is not "passing the buck" onto anyone. I don't expect anyone to overpay their taxes, just to pay their fair share as defined by the tax code. If we decide the tax code is unfair, then we should change it. Until then, everyone should simply pay what the tax code says they owe - deductions, credits and all.

 

OK, so lets suppose that German Banks have a contractual agreement to take possession of all revenue that is generated from the international airport, water, highways can be tolled as well as bridges and of course the brand new railway Greece now owns (better than the old one the Germans themselves are using).

You would agree that this is acceptable? I mean, if that's what the contract that some douche Greek politician (errr 'representative) has signed on behalf of the "Greek Nation" then you'd say this is as it should be?

You also seem to suggest there's no morality involved in the contract. I OTOH think all actions reflect morality in one way or anther - particularly contractual obligations.

What if the Greeks refuse to meet their end of the obligation? Normally a thug would come over and take your stuff (usually wearing a blue clown suite with a pretty bronze or silver badge). Then German could, in theory, invade Greece? I mean, it's just meeting a contractual obligation - no morality here :bugeye:

I'm not blaming anyone. And selling bonds is NOT a free-market. Central Banks are the opposite of a "Free-Market". A slave-market, yes, free-market, no. IMO the issuing of bonds against a fiat currency controlled by a den of thieves is immoral and invalidates the contractual obligation. Case in point: The Children that you have supposed "receive the befits" of what their fathers wasted money on did NOT have a say. Thus, they are NOT obliged to pay for the bond sale.

You can't just say: Well, they benefited because you don't know if they did and you don't know if it was worth what was paid. For example: suppose a bridge through Athens was built and you make the argument that the children benefited by getting to use it. OK, and if it is crap? And if it costs each person $50,000 a year in interest and loan repayment? Then NO, it's certainly not moral and thus this invalidates the contract.

This was used by the Europeans to invade numerous countries and to take large chunks of countries. It was a particularly favorite tactic used by the English to secure land from other people and claim it was moral. Which most civilized people today now know was immoral.

There's an interesting quote from an old Japanese Novel "Taiko" where Oda Nobunaga (the Shogun) is being advised how to deal with the Europeans. I'll paraphrase:
The Dutch he is told, will trade guns for sex. They will try and take our Japanese girls as they seem to favor them to their own (Nobunaga advices to his metalsmith to trade with the Dutch and to copy the guns).
The Portuguese will want to set up missionary. They will want to change the minds of the people and must be watched closely. They use sweets to entice and these are not good for the health (Nobunaga states that the Japanese people are able to taste Christianity, what they like they can taste and spit out what is unfavorable [his advisers cautioned against it, but Nobunaga didn't think much of religion and had a strong sense of Japanese cultural superiority - interestingly there's evidence Nobunaga did love those Portugese sweats though). BUT, the ones you have to watch the closest are the English. They are the most devious of people. They will not care for our woman or for our beliefs. They will come with a trade contract. Through trickery they will entice you to sign it, once it is broken, they take it all.

Yeah, that's why Richard S. Fuld walked away with over $500,000,000 after bankrupting Lehman Brothers.

It's immoral.

There are people pushing to tax us MORE and use that to subsidize medical costs. I don't mind paying insurance - as this does the same thing. But it is IMMORAL for me to force someone else to pay for something they do not want.

What Obama's doing now is trying to force healthy 25 years olds to pay for babyboomers who didn't save anything for their retirement. I more despicable generation if ever their was one. Along with the so-called "Greatest Generation" who happily broke the golden handcuffs and splurged on their kids like there was no tomorrow. 40 years later and their great grandkids are ruined.

"Obeying"? Can you even hear yourself?!? You can't seem to get it? Slavery is immoral. A run away Slave should be applauded NOT handcuffed and forced back onto the farm where she can Obey her Master.

Just because the majority vote to steal (or vote to make slavery legal) does not mean that this becomes moral. As soon as you NEED to use force against a person through no fault of their own other than being born as part of a "Nation" then you should recognize that something is immoral and should be changed.

 

Why would we suppose that? There is no such agreement.

If the duly elected representatives of the Greek people freely enter into a contractual relationship, absent any coersion or fraud, then yeah, I don't see a problem with that.

What is the relevance of any of this? Why can't you stay on topic or answer simple questions?

Then they suffer whatever penalties for default are layed out in any loan agreements they signed, just like you or me. What is the point, again?

No, Greece didn't sign away its sovereignty. The only real penalty for defaulting on sovereign debt is that lenders become very wary of loaning you any more money in the future, and so you have to pay a ton of interest to borrow.

Why are you inventing this inane hypotheticals? This is all irrelevant.

You're blaming the Greeks, explicitly.

Yes it is.

That's nothing but empty sloganeering. Do you have the slightest inkling of how government debt is actually bought and sold?

That is "woo woo" level stuff.

The state represents the nation, not just the individual voters currently voting. This can be seen as unfair to that part of the nation yet to be born, but so long as they are free to exit the nation if they don't like the deal I don't see much of a problem.

Again, provided those people are free to up and leave the nation state in question if they don't like the deal, I don't see a problem. If you're unhappy with the debt load you inherited and don't think it's worth the benefits you're receiving, you can simply move to a different country and so opt out of said obligations. It's the state that is obligated to pay the debts, not individual citizens.

Then any Greeks who don't like that deal can emigrate and so avoid having to pay for it.

An unwise deal isn't "immoral," and it certainly doesn't invalidate any contracts. Bad business decisions are just that.

If anyone proposes invading Greece to reclaim money owed them, you will get a lot of agreement from me (and others, including the UN) that such is unacceptable. Which is exactly why nothing like that is going to happen, or even be seriously proposed.

He got that because Lehman Brothers was dumb enough to offer to compensate him to that tune, even in the event of catastrophe. Which was pretty stupid - it's no wonder they went belly-up. It may well have been immoral for him to exploit Lehman Brothers' stupidity in that way, but it had nothing to do with incorporation shielding him from lega liabilities. Now, contractual liabilities, on the other hand... certainly if he'd of been on the hook for Lehman's debts, he'd have been wiped out. But then, he'd probably never have signed up in the first place in that case, nor would we even have recognizable firms at all. You have to limit the financial risks individuals incur through working for a corporation, or you won't have corporations at all.

There's no "free" involved, there.

And the result would be to save us all money on insurance, overall. A lot of money.

Everyone wants medical care, eventually. And such can only be funded via insurance. It's immoral to let anyone opt out of paying their fair share of the insurance, unless we're prepared to stand by and watch them die when they need care (which would also be immoral). So, the only moral choice is to compel everyone to participate. Otherwise, freeloaders will steal the services that honest people payed for.

LOL no, that's what Social Security and Medicare do. Those aren't new, and Obama didn't come up with them.

What Obama proposes is that people who try to get a free ride, by not paying for insurance (and then incurring massive emergency room costs when they get sick, to be covered by the rest of us) will have to pay a yearly fine to cover those costs. What's so immoral about that?

Generational warfare is useful idiocy for the 1%.

Income taxes levied by a legitimate, democratic government are not "slavery," and it is in very poor taste for you to suggest that it is. This kind of slogan is highly offensive - do you not realize that there are Americans descended from actual slaves? You should stop trivializing their suffering by comparing it to the pain of paying your fair share to keep our society running.

Of slavery and income taxation, only one involves using force. The slave has no choice - if he resists, he gets punished and maybe killed. If you don't like paying taxes, you're free to organize a political movement to get rid of them, or just leave for somewhere else more to your liking. Slaves didn't get a vote, and they didn't get the option to go back to Africa if they didn't like the deal. You do, so stop disrespecting actual slaves by comparing your selfishness to their suffering.

 

quadraphonics,

OK, maybe we need to back up here. It seems to me like we're not even agreeing on what exactly we're disagreeing about, thus leading to frustration and in ability to reach a resolution.

What exactly is a Bond?
What backs up the value of a Bond? I mean, why would anyone want to buy one? What does the buyer get from the bond?

 

quadraphonics,

To clarify my positions which seems obscure:

1) The reason I mentioned invasion is because in the past THAT was the norm. Why do you think we have a large offensive military in the USA? It's to ensure other nations pay their bills. Those bills don't have to be owed to us, but are often denominated in USD as it's the reserve currency. When pressed I recently heard an economist state this was the real reason why he supported the USD as a good investment. It's backed by our military. This has been the rational that justified numerous Wars over the centuries, if not millennial. It didn't take long from the time Saddam suggested selling his oil in something other than USD, to his utter and complete destruction. You'll note, while Iraq is still a sectarian shit-hole nightmare, oil is denominated, once again, in USD. One could call that conspiracy thinking, but, we all know there were no WMD in Iraq. I think only the very patriotic or very naive would suggest our invasion was about anything other than oil and its sale in USD.

2) Income Tax is not voluntarily paid. It's therefor immoral. This is just a fact of morality. I'm sorry if that doesn't sit well with you. Blame logic I suppose. Using force to take private property from someone IS immoral. You can dress it up any way you like. The natural (inherent) state of affairs at present is inherently immoral - which is why I think we need to get rid of income tax and central banks. Regarding the immorality, people who are Statists, even Minarchists like the founding fathers, have acknowledged this. Then they say something or other about the "Human Condition" and sleep well at night.

Its two different things thinking income tax is moral because we vote on it versus knowing it's immoral and accepting this as the state we living in. I accept that this is the way things are now. But, it's not the ideal and it is immoral. I pay my tax. I HAPPILY pay my way. I do not happily pay my income tax. I would however happily pay for all the services I use. I would also donate to those people who need help. Particularly if I had the 30% of my income being stolen from me by the State so some politician can use it to bribe his or her electorate.

Hence the island rape example.

You can prove this to yourself. Was Slavery moral in 1650? Was rape moral in 300BCE? Why?

3) Bonds, are not only non-voluntarily paid children don't even have a chance to vote for or against them. It's therefor immoral. I have no problem with society paying and building things. This has to be paid for and built by the generations who is using it. They get to used what was left to them. They leave to their children. That is the moral society. This is just a fact of morality. I'm sorry if that doesn't sit well with you. Blame logic I suppose. Borrowing from your children's future income and prosperity to give to yourself is immoral. Which is why you can not do it. Your debt will not be left to your children. The State, with a total monopoly on the initiation of force, OTOH has granted itself the privileged of doing this. Well, the Greeks are learning a real lesson in immorality and so shall we.

 

"...Greece is on the brink of a severe healthcare crisis as shortages of medicines are exacerbated by panic among patients unable to get cancer or cardiac drugs, pharmacists have warned. Greece’s worsening liquidity has led to public insurers being unable to pay bills and prescription drugs running dangerously low, say chemists. Yesterday, the sector staged a one-day strike to highlight the "emergency situation".

"I give it 15 days. If the European Union doesn’t release the loans it has promised by then, there will be scenes of utter chaos here," said Dimitris Karageorgiou, secretary general of the Panhellenic Pharmaceutical Association. "Already we have cancer sufferers going from hospital to hospital to try and find drugs because no one can afford to stock them. If the shortages get worse, God knows what we will see."... "

From: http://pharmalive.com/news/index.cfm?articleID=841451&categoryid=9&newsletter=1

Someone should start a list of the different forms of panic which will hit Greece - all of which just make the problem worse as each person try to look out for "# 1."

 

It would be too long a list.

Just for starters, most Greek banks are already technically insolvent. They are big holders of Greek government bonds, and those assets had to be written down recently when Greece defaulted. It hasn't gotten as much news coverage as it might have and hasn't led to panic (yet), since the European Central Bank has agreed to back up the Greek banks as needed. But little of that promised money has actually been transferred yet, and if Greece repudiates its agreements, it might never be transferred.

So we might see a big-time run on Greek banks at any time. The banks can't possibly repay all of their depositors, so the government would have to close the banks, forbid withdrawls and freeze accounts. And if vast sums of additional Euros aren't forthcoming, the Greeks would be more or less forced to start printing Drachmas in order to keep their financial system from totally imploding.

While all this is happening, the banks aren't going to be making loans. So store shelves might start to empty and Greek small businesses close.

Contracts between Greek firms and their suppliers and customers elsewhere in Europe and the wider world will all fall into doubt. Lawsuits will inevitably fill up the courts. Supplies from abroad that Greece needs from abroad might start to become scarce.

And reportedly, Greece only has enough funds to keep paying Euros to its public employees and its pensioners for a few more weeks. The Europeans will have to inject massive amounts of Euros into the Greek government, or else it will be forced to start handing IOUs or new Drachmas to those dependent on government payments, including hordes of militantly unionized public employees. There could be a lot more rioting in the streets of Athens.

Lots of economists are arguing that if Greece introduces Drachmas, and these devalue as expected relative to the Euro, then that currency devaluation might ultimately be a good thing for Greece. But getting there will take a lot of skill and dexterity on the part of the Greek government.

That will require that Greece remain on an austerity course that already has Greek voters very angry. If Greece simply starts printing Drachmas like crazy to fund their massive deficits and to keep their unsustainable welfare state fully inflated (they will inevitably call that "stimulus" intended to promote "growth"), then all the advantages of a currency devaluation might end up being swallowed by inflation.

And there are all the broader contagion effects. People are arguing that Greece is a small economy that's tiny compared to the rest of Europe. But in 2008, Lehman Brothers was tiny compared to the US economy too, and Lehman's failure almost took the US banking system down with it. It isn't clear (to me anyway) how far the commotion of a Greek collapse might echo in Europe's and the world's finances.

Looming over everything is a growing European consensus in opposition to Angela Merkel's fiscal austerity, in favor of preserving the European welfare state under the guise of promoting "growth". The recent French elections may have tipped the balance against Germany.

So I'm inclined to think that the chances of the Euro disappearing entirely are rising. If it isn't just a matter of Greece being squeezed out of the low-end, but also a question of Germany being squeezed out of the Euro at the top-end (trading a resulting too-strong D-Mark in exchange for not being expected to fund the rest of Europe's excesses), the Euro will be toast. Perhaps the whole dream of European unity will be along with it.

Things are very worrisome in Europe right now.

 

In Europe, there is hesitancy in helping Greece, since they are not willing to shrink the size of their benefit obligations. They will need a fix each year because they can't help themselves do the right thing. Greece is like a house that is a money pit.

Let them default and when they do, investors get to pick their bones. They have some nice national treasures that can be auctioned off. The Greek people can take it out on the leaders and unions who brought it to this. When things are about to hit skid row, we invest and rebuild but in a way that is sustainable.

The analogy is repotting a pot bound plant. You trim back all the branches and then saw down the rootball to a tiny fraction of the original. This looks brutal in the short term, since the plant is so small. But this is its new foundation. You then repot it with good soil and in a short time, Greece is health and strong. The old root ball and dead branches are composted in the annals of history.

Mitt Romney was not a vulture capitalists, since vultures don't leave anything behind that is still alive. That analogy is deceptive. He was actually a repotting capitalists. He chops off branches and trims the root ball (management) and then repots what is left. Life remains and it grows from this smaller plant.

Maybe Mitt Romney could suggest how to trim the pot bound Greek plant.

 

Greece is a great example of what the USA is going to look like.
I'd be listening for when *gasp* Islamic Communist Alien Invaders from Mars/Iran ...... ATTACKS!!!

We need Inflation and a LOT of it. We also need to get rid of a lot of people. At least according to the Lords of Currency with their high Priest Bernanke and his alter boy side-kick Krugman.

 

"... Der Spiegel reported that the IMF may well cut off aid to Greece and says this follows the ECB's decision on Friday to no longer accept Greek sovereign bonds as loan collateral. *
The paper goes on to say that IMF's reported refusal to make further rescue payments to Greece increases the risk of the country’s insolvency in September. Recall that the country only has stated that there is only enough cash on hand to last until September ..." From: http://www.stateofthemarkets.com/re.../1/0/373690e966babbbbecdb1ea83edbd7c2e6c91251

Bill T comment:Possibly, with most of the attention on Spain (some on Italy) many will barely notice when Greece leaves, but some who lent Greece funds will feel the pain.
* I guess that means Greek bonds soon are not worth the paper they are printed on.

Don´t worry about the dollar, yet - It is still the least ugly whore in the whore house of international finance and will remain so until China backs it bonds with gold.

 

Given that the "some who lent Greece funds" is equivalent to "all of the major banks in the major European countries, who in turn are tied in with the USA," one wonders where the hell you've been during this whole crisis. This stuff has been heavily, routinely covered in the news for a long time now.

 

Picture worth 1000 words:

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In case you don´t know your Greek geography that gray hole is shape of Greece.

 

First (& biggest) of 2000 corrupt high-up Greeks avoiding taxes etc. is going to Jail and has had his assets ceased - too bad US cannot do the same.

Too bad not one US banker has gone to jail (or even given back the fradulantely earned commission, etc as I suggested long ago:

PS Unfrotunately they did pass it to Freddy & Fanny and now the Fed is buying it at a 40billion / month rate! - But you know who will pay or lose their saving if in dollars in the end, don´t you?

Note the text now red was black in the original - I made it red to tell why this was a version of the Ponsi plan. - I.e. invest early, cash out, to later investor, until finally the housing bubble had to collapse. - In my even older post on the "6-L cycle" I noted that no old and Large sequment of the economy can grow in value long if increasing more than twice as fast as the economy as a whole. - I.e. the bankers knew the last in to the Ponsi would suffer great losses as I did and posted. They are not as ignorant as the people they were writting unpayable mortgages for. As I suggested in point 5, at least 100 of them should now be in Jail.