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| ECB Dissembles And Equivocates: Greece in forum [Market-Ticker]
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Nevertoolate
Posts: 1218
Incept: 2007-08-26
San Antonio de Bexar de runover with illegals, Texas
Online
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We're going to whip out our plastic and the waiter will return with a note where the sales receipt normally is signed saying, "Declined". This whole generation was corrupted by "I'll gladly pay you Tuesday for a hamburger today". The people who understood the math are either dead or outnumbered at the voting booth by the ones who .gov didn't bother teaching reading, writing and arithmetic (since 1969 +/-)to. We are generationally screwed (by banksters for money and power by the politicians) as a nation. Endgame....this will be the first generation since our nations birth that will not be better off than the previous. "He who has everything, but lost his soul has nothing." (Sorry for the rant.)
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"Socialist never mind stealing, as long as they are the ones doing the stealing. They never mind lying, as long as they are doing the lying."-Mannfm11
Before you attempt to beat the odds, be sure that you can survive the odds beating you.
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Glasshammer
Posts: 260
Incept: 2009-09-02
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"that by some estimates (including the CBOs!) will add further to our budget deficits!"
Krugman said the exact opposite and cited the CBO in his latest piece. I guess you can get two different interpretations of the same data(we must be nice to because the man trys so very hard to rationalize every action of this administration).
Of course our objections to healthcare don't really matter just like our objections to TARP didn't really matter. Thank God the lobbyist are able to free my represenatives from acting on behalf of the voters.
You summed up nicely why we can't "de-leverage" banks for the simple fact it would reflect poorly on our GDP.
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Markgoldman
Posts: 1240
Incept: 2009-01-13
Canuckistan
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Really like your GDP idea, borrowing money as 'growth' for unproductive purposes...I think your charts sum how that is working out.
Shame it is so difficult to calculate the marginal productivity of the debt currently going into our system, the GDP could also reflect how much of that 'growth' is productive money.
GDP should go completely, replaced by a more reflective metric that includes debt, a very basic quality of life index, employment levels and income, health care (punishing 'gdp' if the % expense is over an OECD average say..) and other technicals to get a real picture of how our free market capitalist SOCIETY is doing.
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Consent Withdrawn.
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Frat
Posts: 1934
Incept: 2009-07-15
NKY
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Wasn't it someone in the TF that said (after Merkel said basically "We won't hang Greece out to dry") "Watch what they DO, not what they SAY." ? Sure enough, the ECB and EU have basically said "Piss off, you're on your own." Not that I'm against this necessarily; it's high time we do this as well.
But, as Karl so constantly and eloquently puts - we won't. It's not going to end until it CRASHES - spectacularly so, since we refuse to stop it ourselves.
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We're ****ed. Where's Henry Bowman when you need him?
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Ubecool
Posts: 12
Incept: 2009-08-10
Germany
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Well, for us in EU it is basically common knowledge that Greece has always been beyond sustainable financial levels. I doubt that Greece would ever have made it into the EU if Greece had presented the "true" numbers. And they kept lying for years. "In 2004, Eurostat, the statistical arm of the European Commission, after an audit performed by the New Democracy government, revealed that the budgetary statistics on the basis of which Greece joined the European monetary union (budget deficit was one of four key criteria for entry), had been massively underreported by the previous Greek government (mostly by not recording a large share of military expenses)." http://en.wikipedia.org/wiki/Economy_of_....Therefore I really do not understand the "hype" on this fact since from the beginning Greece has never presented true or sustainable numbers, not even close. To me it was only a matter of time that this information is taken into consideration by a rating agency. And you know what: it helps to get the USD stable (at least compared to the EUR). Now, that is convenient, isn't it? At least for the FED. They are able to keep on printing without getting too much in trouble by a bad EUR/USD ratio. In my view the EUR has gotten along with a weak Greece quite long and I am convinced it will NOT be the end of the EUR if Greece continues to operate at non-sustainable GDP levels. They always did that. In my opinion his "problem" is sort of artificially pushed. There are a bunch of problems where I see the EUR could fail or the EU could get split up. But Greece is not in that line..
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Treat your friends as you do your pictures, and place them in their best light. [Jennie Jerome Churchill]
Those who would give up Essential Liberty to purchase a little Temporary Safety, deserve neither Liberty nor Safety. [Benjamin Franklin]
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Bustedbuck69
Posts: 479
Incept: 2009-11-10
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Greece go pound sand.  Hypo Group in Austria, we are here to help. The selective nature if this is always entertaining. Selective processes --- Lehman meet Bear. And then there is this deja vu: Quote:---Chancellor Werner Faymann sought to calm the fury of Austrian citizens and opposition leaders, saying there would have been "catastrophic consequences" if the bank had been allowed to fail.--- Telegrapg.co.uk GDP turning into a joke, reality is out on the streets. 
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"---the politicians---they think the laws of mathematics are suggestions." K. Denninger
"The greatest shortcoming of the human race is our inability to understand exponential function." Al Bartlett
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Timbo
Posts: 2499
Incept: 2008-10-10
the holy mountain
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Quote:if debt goes up by 4% of GDP then the 4% has to come off the reported GDP numbers Is it not captured in NDP? Or do they not use that number (in which case, rational accounting is hopeless)?
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Mortgageguymn
Posts: 1561
Incept: 2009-03-09
North Coast
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Krugman always has some rationale for how borrowering ever more money is perfectly OK. Usually that involves comparing a portion of US debt with the entirety of other countries' debt. So he counts US Federal debt againt other countries' debts, leaving out the fact that we are a republic and that more of our borrowing is done at the state & local levels than in other countries. Or he considers only US "foreign" debt, as though the eventual default (and/or currency devaluation) will be OK to the extent that only US citizens are screwed. Of course he would exclude Fannie/Freddie debt from his total US debt calculations - while calling it "agency" debt to justify the Fed buying it, in contravention of law.
Krugman doesn't have any children. Maybe that explains it.
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Diogenes
Posts: 974
Incept: 2007-08-03
Groningen, Netherlands
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This is not selective at all by ECB. They are a central bank and can only do things for (member) banks. They cannot bail out a country/state; that would be up to other european institutions.
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The only price discovery that is happening in todays markets is the price wich a society pays when it allows its markets to be run by corrupt bankers.
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Tienkou
Posts: 4225
Incept: 2007-09-09
Connecticut
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If Greece goes boom on eur300 billion, the EU will go boom.
That debt has also been leveraged across the entire EU.
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Barack Hussein Obama - The last President of the First American Revolution.
The US Congress has abdicated its role as a governing body.
The most dangerous man is the one with nothing left to lose. Our government is making more of them everyday.
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Musashi
Posts: 3835
Incept: 2007-11-06
Behind the Irony Curtain
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Quote:Wasn't it someone in the TF that said (after Merkel said basically "We won't hang Greece out to dry") "Watch what they DO, not what they SAY." ? Well, the statement is technically correct. They are not going to "hang them out" to dry, they are going to "squeeze" them dry.  |
Rbarreira
Posts: 2826
Incept: 2009-05-27
Portugal -> Sweden
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IMO Greece will cause a € failure as much as Oklahoma and California will cause a $ failure... i.e. it won't.
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In Soviet Russia, the government regulates the banks.
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Musashi
Posts: 3835
Incept: 2007-11-06
Behind the Irony Curtain
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Agree. The size of a CA failure is a large multiple of a Greece failure.
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Sp
Posts: 66
Incept: 2008-02-26
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What's a poor body to do? Lobbyists run and rule the agenda, Greece is Greece if ou have followed their fiscals for the past twenty years.... and Mike Turner wants me to make an easeeeeee 63.7% on my money.
I'm waitin' for u to run 4 office.
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Riceday
Posts: 501
Incept: 2009-10-30
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"So exactly what sort of "fiscal austerity" are we enacting here in the US? Oh let's see - how about a huge entitlement system change ("Health Care Reform") that by some estimates (including the CBOs!) will add further to our budget deficits!"
Oh, there will be austerity - in the form of severely rationed care. That's why they claim it will reduce the deficit. This has nothing to do with improving healthcare/coverage.
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Steelhead23
Posts: 2036
Incept: 2008-09-09
Portland OR
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Quote:Reality is that none of the so-called "regulators" - worldwide - have any interest at all in prudent lending. Why not? Because prudence in lending, leverage ratios that are actually enforced and mark-to-market restrict bank profits - that is, the amount of GDP that banking institutions of all sorts can extract from the economy and transfer out to the "privileged class" via so-called "proprietary trading" and bonuses. You know, that could have been penned by another Karl. The breadth of the corruption in global finance is a crucial observation, behind which is bribery, a revolving door, and a network of back-slappers and egomaniacs. It is my view that the process of corruption between banks and regulators would be significantly reduced by the removal of profit from the commercial banking system. I accept that the idea of not-for-profit banking tends to cause knee-jerk axions to fire in our brains that such banking would be inefficient and unimaginative. Well, I'd rather do battle with inefficiency than money-driven corruption and unimaginitive is just the way I want the banks to behave.
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"Give me control of a nation's money and I care not who makes it's laws" —Mayer Amschel Bauer Rothschild Benjamin Bernanke
For-profit commercial banks are a menace and should be eradicated
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Leicestersq
Posts: 221
Incept: 2009-10-12
UK
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Does anyone have any information on the Austrian bank bailout referred to in this ticker?
I missed that bit of banking history entirely.
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Deejunk
Posts: 715
Incept: 2008-10-11
Now DC - Solar Power.
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Genesis wrote..Now the check for our profligacy is on the table and the waiter is tapping his foot. Yeah - ba ha ha!
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Reason: Yeah - ba ha ha!
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Snowman
Posts: 1797
Incept: 2009-03-09
avoiding yellow snow
Online
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Greece needs 40bn to close the gap. 20bn to look serious. on a GDP of 360bn they need to save (aka plug the dike on rampant bribery and corruption) about 10bn on public finances and get the rest (pro rata) from EU members as greenmail to keep Euro intact. Public expenses are about 90bn so it comes down to a 10% save. 10% is what you usually budget to pay public officials to do stuff for you.
I doubt the eurotrash will let these bozos float. It will mean more pressure on the Euro, the countries will have to raise yields to get investors interested.
At the same time Fed also has to raise yields to get investors interested. Let the most indebted win.
2010 will be the year of the currency pimps.
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Soar07
Posts: 353
Incept: 2009-05-04
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Is their a Radio Show Today?
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Time to put the USA first! Stop Globalization, Illegal Immigration, Outsourcing. Buy American. Enforce the rule of law. Drop kick political correctness!
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Inez
Posts: 360
Incept: 2009-07-08
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Mikek31
Posts: 4341
Incept: 2009-05-04
Chicago
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I give Greece about a 0% chance of getting out of this. And we're not far behind them. Quote:
Garbage piled up on a street in central Athens on Thursday because of a municipal worker strike.
Greece Struggles to Stay Afloat as Debts Pile On
By RACHEL DONADIO and NIKI KITSANTONIS
Published: December 11, 2009
ATHENS — Ever since Greece’s credit rating was downgraded last week, its new Socialist government has fought back, saying it has the mettle to tackle the soaring deficit and structural woes that have earned the country a reputation as the weak link in the euro zone.
“We will reduce the deficit, we will control the debt and there will be no need for a bailout,” the Greek finance minister, George Papaconstantinou, said in an interview in his office here this week. “We are not Iceland; we are not Dubai.”
But Mr. Papaconstantinou may have good reason for the traditional Greek metal worry beads he fingered during the interview. Outside his office, garbage was piled high in Syntagma Square, a result of a two-week strike by trash collectors that ended Friday.
A student demonstration was advancing on the square a day after pensioners had taken to the streets. This week, protests for the first anniversary of the death of an Athenian teenager shot by the police turned violent, but did not cause as much damage as disturbances last year.
Common in Greece even during better times, such protests are expected to increase drastically once the government introduces austerity measures in its 2010 budget, including wage freezes and measures to scale back public sector hiring, steps it says are needed to bring Greece’s finances under control.
As Mr. Papaconstantinou suggested, the problem is not Greece’s alone: heavily indebted countries, including Ireland, Britain and Spain, are under pressure to show that they can stimulate growth and grapple with debt burdens at the same time. Investors and European monetary officials are skeptical.
Greece, in particular, has to transform a culture with a low tolerance for change and a high tolerance for protest, no easy task for a two-month-old Socialist government that says it is committed to sustaining social spending. While convincing European Union leaders in Brussels, the new government also has to win over Greece.
The president of the civil servants’ union Adedy, Spyros Papaspyros, said the union was prepared to strike if cutbacks were unilateral and severe. “If funding cuts are made in critical sectors such as health or welfare, we create a serious risk of destabilization,” he said.
The political and social challenges are intense. “It will be a very tall order for any country to pull off the fiscal rescue they’ve now got to pull off,” said Simon Tilford, the chief economist at the Center for European Reform in London, a research group. In light of Greece’s political challenges, he added, “I find it at this point difficult to see how Greece is going to manage this without some kind of fiscal crisis.”
Certainly, the bond markets think Greece is a risky bet. Yields on the country’s two-year bonds soared to 3.09 percent from 1.9 percent this week — the worst for the markets here in more than a decade — and were about 3 percent on Friday, while the 10-year bond rose to 5.3 percent this week from an already elevated 4.99 percent. In the United States, by contrast, a 10-year bond yields 3.55 percent, and a two-year bond 0.81 percent.
The dire economic situation has prompted the question of what went wrong in a country that was once seen as a model for European Union membership and that enjoyed 15 years of sustained growth, coming from behind to host the 2004 Summer Olympics.
“We didn’t use the Olympic spirit well,” said Elias Clis, a former Greek ambassador. “The previous government took the safe way, and the safe way is a very dangerous path.”
After winning by a wide margin in October, the Socialist government of Prime Minister George Papandreou announced that the country’s budget deficit was 12.7 percent of the gross domestic product, more than four times the 3 percent ceiling set by the European Monetary Union.
Mr. Papandreou last week estimated the national debt at $430 billion, calling it Greece’s worst crisis in three decades and blaming his conservative predecessors for the economic state. Greece’s national debt is expected to rise above 110 percent of its gross domestic product.
Last week, the ratings agency Fitch downgraded Greece’s credit rating based on fears that the deficit might cause the country to default, and the change sent Greek shares plunging and made the markets jittery. Standard & Poor’s has said it will reserve judgment until it sees the plan the government is expected to announce in January.
On Friday, Mr. Papandreou stressed the need for drastic measures. “We acknowledge the scale of the problem that we are faced with, and we are determined to make the shift toward a sustainable and healthy economy,” he said in Brussels.
He called for a “merciless crackdown on the corruption that is endemic in society and on widespread tax evasion.”
Yet that is not expected to be easy. The underground economy, which some estimates place as high as 30 percent of gross domestic product, helps people in countries like Greece that have European prices but salaries below the European average.
As he sat in a cafe with friends in the chic Kolonaki area on a recent afternoon, Antonis, 33, who disclosed only his first name, proudly announced that he refused to pay taxes.
“Why should I pay?” he asked with a grin. “I don’t care about my government; I don’t care about my country,” he added. He conceded, however, that he did care about soccer and women.
Such views, while not always so vehement, are common in Greece, where the government is widely seen as corrupt, regardless of who is in power. Few people expect much from the state — except highly coveted public sector jobs. Today, one in four Greek workers is employed by the state, a result of decades of public hiring to stave off social unrest.
The Papandreou administration has said that in 2010 it will hire only one new state worker for every five who retire. But that, too, poses problems. Savas Robolis, a member of the main labor union, the Greek General Confederation of Labor, who serves on a government committee on pension reform, called the pension situation a “time bomb.”
He said Greece had only enough money to pay pensions for one more year. If the country does not replenish the pension funds, “then we will face a huge social crisis in 10 years,” Mr. Robolis said.
Fears of cutbacks are causing widespread anxiety. Lambrini, who works in the Health Ministry and would give only her first name, said a possible freeze on her $1,300 monthly salary was a real concern for her and her husband, a municipal worker.
“We want to plan a family, but I don’t see how we can with such low incomes and with prices going up all the time,” she said.
She said she had never joined a labor protest before, but would take to the streets if her salary was frozen or cut. “I’ll be there,” she said. “And so will half the population.”
http://www.nytimes.com/2009/12/12/world/....
Black markets, "underground" economies, tax dodging, public sector jobs, and rampant government corruption will sound all too familiar here in the near future.
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Everyone keeps looking at the system and saying "it's not working, it needs to be redesigned somehow." It's working exactly the way the people who own it intend it to work.-Sutluc
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Mikek31
Posts: 4341
Incept: 2009-05-04
Chicago
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Inez, we may soon need a petition to kill the Senate altogether. 
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Everyone keeps looking at the system and saying "it's not working, it needs to be redesigned somehow." It's working exactly the way the people who own it intend it to work.-Sutluc
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Jnojr
Posts: 784
Incept: 2008-09-18
San Diego, CA
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Quote:Inez, we may soon need a petition to kill the Senate altogether. I think a gallows would be more effective. |
