Greece...

[civilservant]

The Greeks - all of them - want to stay in the eurozone. They FEEL European and the euro is the most potent signal of that.

They're up a creek anyway whether they leave or stay. The country has been living on borrowed time, borrowed money and empty politicians' promises for years. Syriza is just the latest of a bad lot. It is painful to watch them - Tsipras, Varoufakis, various MEPs and MPs - twist and squirm and bluster under questioning. Its going to be painful no matter what

[Earl Aelfheah]

That's for sure

[Loz]

rahrahrah Wrote:

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> There is no way Greece can meet the conditions

> imposed upon them. They should leave the euro and

> start rebuilding their society and economy.

It's a rock and a hard place, isn't it? But leaving the Euro might actually be harder since they are a seriously net-importing country, so switching to a currency that will devalue rapidly would be extremely difficult for them.

So I think what they have now is possibly the least-worst, mainly as Germany doesn't trust them now and so will be checking to see that all the structural things they should have started changing 5 years ago (improving tax collection, getting rid of cronyism, freeing up their labour market) may actually now get enacted.

The question the Greeks may now ask is: how many billions will Varofakis' silly games cost them in the end?

[miga]

Loz Wrote:

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> The question the Greeks may now ask is: how many

> billions will Varofakis' silly games cost them in

> the end?

I think they're more likely to ask themselves what the point of clearly voicing their opinion in that referendum was, given that the conditions attached to the latest tranche of debt are worse than before, and that Greece won't be in charge of that money anyway. Assuming Tsipras gets the deal through parliament.

It's second rate thinking to pin the current crisis on one guy, who's been second in charge for less than 6 months.

[miga]

Which BTW is what you were wondering earlier in the thread re: referendum - what was the point when the deal is worse than what was on the table some weeks back.

[Loz]

miga Wrote:

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> Loz Wrote:

> -------------------------------------------------------

> > The question the Greeks may now ask is: how many

> > billions will Varofakis' silly games cost them in

> > the end?

>

> I think they're more likely to ask themselves what

> the point of clearly voicing their opinion in that

> referendum was, given that the conditions attached

> to the latest tranche of debt are worse than

> before, and that Greece won't be in charge of that

> money anyway. Assuming Tsipras gets the deal

> through parliament.

I agree - as I said in my post (July 10, 03:02PM)

> It's second rate thinking to pin the current crisis on one guy, who's been second in charge for

> less than 6 months.

That was a second rate reading attempt - it's not what I said at all. The crisis in itself wasn't Varofakis' fault (obviously), but all the posturing that led to capital controls and to Greece being offered an even worse deal can be laid directly at his doorstep. He basically used Greece to test a few (failed) game theories of his. And it has cost them billions more.

[miga]

Loz, by "current crisis" I largely meant the immediately preceding negotiation impasse - to the extent that you can separate the negotiation from the context of the previous 5 years. I disagree that the fact the negotiation failed so badly (from the Greek perspective) can be attributed mainly or only to Varoufakis, however annoying/narcissistic/bald/"bookreading" his presence some find.

He attempted to renegotiate terms, which seems quite reasonable to me given the circumstances. He was second in charge in a country where the economy is shrinking (ability to repay debts decreasing), and debts are increasing so that they need to borrow just to repay interest. It seems like a reasonable thing to aim for from his perspective to attempt to get some of the debt forgiven/restructured and attempt something other than what hadn't been working for the previous 5 years. If the facts (rather than opinion) of what he stated in the New Statesman interview today aren't outright lies (a possibility) it would appear Schauble was inflexible in position, but also uninterested in rounding off the talks constructively. I guess he'll have his reply soon enough.

Related, there's a narrative about Varoufakis as this psycho academic narcissist who tested out his loopy academic theories on the long suffering Greeks, pushed from various corners of the media. Aside from this being slightly corny, I think it misses the point that there are two sides to the negotiation, and that whatever you think of him, he and Tsipras had a clear mandate from the Greek population to renegotiate the deal.

[Otta]

For me the saddest thing about this whole affair is the lack of humanity within this "union".

I get that debts need to be paid, but I feel like Germany in particular are almost enjoying beating Greece with a stick.

There is an easier way to do this (slowly) but it's just not being considered.

[*Bob*]

Otta Wrote:

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> I get that debts need to be paid, but I feel like

> Germany in particular are almost enjoying beating

> Greece with a stick.

When you're paying the most, you get to hold the stick.

[Jeremy]

Yep... doesn't say much about the "union" when the wealthy partners are using strong-arm tactics to force austerity on the poorer ones.

[Loz]

If I need the bank to extend my credit, opening negotiations by talking a dump in the manager's out-tray and calling him/her a fascist bastard probably will not elicit much sympathy towards my situation, however dire my predicament.

[miga]

I'm not sure that analogy works. When did Tsipras/Varoufakis call Germans "fascist bastards"? Are you talking about the discredited "flipping the finger" thing from a few months back?

ETA: I just re-read about that story, and yes, he did give Germany the finger in a speech years before he became a minister/negotiator, within the context of a much longer talk.

[Parkdrive]

I bet the Greeks that voted for Alexis Tsipras and his anti austerity stance are well chuffed with the new deal he's brokered for them.

[*Bob*]

Merkel doesn't want to go down in history as the Chancellor that started the European exit and Greece must know this - so I think the current situation will draw itself out for the time being.

But eventually Greece will go, followed by various others.

[PeckhamNicola]

Otta Wrote:

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> I get that debts need to be paid, but I feel like

> Germany in particular are almost enjoying beating

> Greece with a stick.

I agree with the sentiment, but debts don't need to be paid, the Greeks can default. The renewal of loans the Greeks need are mainly to continue paying back the loans made to them by French and German banks. So basically the strongest EU countries are using their power to protect their own banks who made careless lending decisions. Whatever happened to banks managing risk when lending? Oh...

[Blah Blah]

That's not quite true. Around 30% of the payment needed is to make the outstanding repayments. The rest is needed to prop up the banks, public services and pensions. The country is bankrupt. The banks are running out of money. When banks run out of money, cashflow is affected in every sector. Businesses have to lay people off, or worse still close. Everything stops.

I think what needs to happen is that the EU needs to write off around a third of the bailout debt and set a repayment structure on the rest that doesn't strangle any chance of recovery by the Greek economy. And the Greek people themselves also have to accept that things have to change. They have to pay tax. They have to understand that economic recovery depends on them working longer for less and they need to be realistic about public expenditure.

Pulling the plug on Greece is not an option just as Greece pulling the plug on membership of the EU is not an option for them either.

I disagree on Merkel bob. Merkel only has to look to the history of her own country to know what happens when another country calls in loans. The USA did it after the Wall Street crash forcing the already delicate German economy to hand over a fifth of their gold and Reichsmarks. The following depression led to the rise of an extremism we all paid for in the end. I believe she is genuinely trying to save Greece from the abyss.

The Greek government have been obstructive though. A sane government works for the best deal and then sells that to their people. Tsipras has played games. He won on a ticket of us vs them, but right now, them is the only thing keeping Greece going. The referendum was pure showmanship.

[Gadge]

....

[Gadge]

Greece owes Germany ?56b, France ?42b, Italy ?37b, Spain ?25b, Other euro zone countries with smaller economies than Spain ?32b and another ?100b to mostly European banks. It is the tax payers of these countries, particularly German that are wanting to cut Greece loose. In writing off these loans it will crystalise the losses for the taxpayers in each country. I wonder what a uk taxpayer would say having to stump up such money.

[Earl Aelfheah]

PeckhamNicola Wrote:

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> Whatever happened to banks managing risk when

> lending? Oh...

That is the Billion euro question.

[DulwichFox]

I don't really understand World Economy / Debt.

If someone borrows ?100.00 from a loan shark.. who then charges extortionate interest and tells them

they now owe ?2,000. They do not really owe ?2,000.

How much of this sort of thing applies to the situation with Greece. ?

When the economy broke down in 2008/9 it seemed every country was in debt 'but to who' ?

DulwichFox

[*Bob*]

Blah Blah Wrote:

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> I disagree on Merkel bob. Merkel only has to look

> to the history of her own country to know what

> happens when another country calls in loans. The

> USA did it after the Wall Street crash forcing the

> already delicate German economy to hand over a

> fifth of their gold and Reichsmarks. The following

> depression led to the rise of an extremism we all

> paid for in the end. I believe she is genuinely

> trying to save Greece from the abyss.

True, but then Greece is unlikely to produce a fascist regime with a large, highly mechanised army capable of storming most of Europe!

[bodsier]

Well given that vast amount of money is spent on war weapons, and then the cost of rebuilding counties, (much of it wasted).....I'd like to think that most woulld prefer to alleviate the poverty and uncertainty faced by Greeks....

http://www.telegraph.co.uk/news/uknews/defence/10859545/Wars-in-Iraq-and-Afghanistan-were-a-failure-costing-29bn.html

http://www.telegraph.co.uk/news/worldnews/asia/afghanistan/11004928/Afghanistan-has-cost-more-to-rebuild-than-Europe-after-Second-World-War.html

[miga]

*Bob* Wrote:

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> Blah Blah Wrote:

> --------------------------------------------------

> -----

> > I disagree on Merkel bob. Merkel only has to

> look

> > to the history of her own country to know what

> > happens when another country calls in loans.

> The

> > USA did it after the Wall Street crash forcing

> the

> > already delicate German economy to hand over a

> > fifth of their gold and Reichsmarks. The

> following

> > depression led to the rise of an extremism we

> all

> > paid for in the end. I believe she is genuinely

> > trying to save Greece from the abyss.

>

> True, but then Greece is unlikely to produce a

> fascist regime with a large, highly mechanised

> army capable of storming most of Europe!

Although looking at the shape of Golden Dawn man, any Greek fascist regime will just need to wrap him in something sturdy and roll him down Europe's highways and byways, like a giant souvlaki of death.

[Jeremy]

Blah Blah Wrote:

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> I believe she is genuinely trying to save Greece from the abyss.

If she is, she's gone about it a strange way. By agreeing on a "haircut" months ago, Germany could have given Greece a fighting chance of recovery while still repaying a large chunk of their debt. But by trying to force Greece into austerity measures, she has caused widespread resentment, destabilisation of the union, radicalisation of Greek parliament... AND Germany still aren't going to get paid in full. Lose lose.

[Earl Aelfheah]

Jeremy is right. As I understand it, the IMF suggested that Athens should receive a 30-year grace period before it has to start paying off its debts. it seems to me that something much more generous needs to be done with regards debt relief, if Greece is ever going to rebuild and (eventually) be in a position to start repaying creditors.