Is the end nigh for the Euro? [vol. 3]

[Art0ir]

AJS- said:

Sorry if it's been posted already but there's a very good article in the Telegraph about this

http://www.telegraph.co.uk/finance/economics/11687...

Certainly Greece has messed up but not alone.

I've tried raising similar points here, only to met with silence or told it's all Greece fault. Syrizas counter proposals were entirely rational and practical and far more effective than simply a fire sale of state assets.

[AJS-]

Indeed.

I think any sensible finance minister whose country is in the Euro must surely have an eye to an exit if or when their time comes.

[andy-xr]

Steffan said:

I agree with both of you!

Currently the reputation of the EU as an effective organisation managing difficult problems, if in fact there ever was that reputation,this is already in tatters. If the EU carry on trying to bail out Greece the little reputation and credibility of the EU as a competent balanced organisation of the EU will evapourate totally!. Shredded very effectively by the the utter nonsense spin that the EU have tried to put on this disaster for both Greece and the EU!

I disagree with this, I think that if the EU cut Greece loose then their reputation around effective organisation, managing difficult problems etc will really end up in the stter.

The problem is, if the rest of the world sees that someone's brother got shot in the leg, and the family's remedy is that they cut all his legs and arms off just incase they might go gammy, then stab him for good measure, it'll not look particularly cool.

The EU I think will step in and bail Greece out using AN Other fund. It might be that a couple of ballot papers go a particular way in how they're reported though

[confused_buyer]

Art0ir said:

I've tried raising similar points here, only to met with silence or told it's all Greece fault. Syrizas counter proposals were entirely rational and practical and far more effective than simply a fire sale of state assets.

I can't say I often agree with Communist/Marxist economist who delighted in British Soliders getting blown up in Northern Ireland but Varoufakis did talk a lot of sense in the interviews I saw yesterday.

The is no hope whatsoever of any sort of stability in the short or medium term or any hope of anyone ever seeing any money if the Greek economy can't start growing again (even stopping it shrinking any more would be an achievement).

[AJS-]

I think the worst aspect of the whole fiasco is the time it has all taken. 6 years - the duration of WW2. 18 successive quarters of recession. It will blight a generation.

Had they reverted to Drachma in 2010 (as they must surely do eventually) it's hard to imagine that they would be in a worse position now.

There may have been a default of some sort but there would also have been the possibility of recovery.

[Art0ir]

confused_buyer said:

I can't say I often agree with Communist/Marxist economist who delighted in British Soliders getting blown up in Northern Ireland but Varoufakis did talk a lot of sense in the interviews I saw yesterday.

The is no hope whatsoever of any sort of stability in the short or medium term or any hope of anyone ever seeing any money if the Greek economy can't start growing again (even stopping it shrinking any more would be an achievement).

I wasn't aware of his views on Northern Ireland (or why he would even have any), but I do think plenty on PH are blinded by the left/right paradigm, where everything that comes from the right is spot on even if a little extreme at times and everything from the left is wrong either by virtue of naivety or jealousy.

[AJS-]

What did he say about Northern Ireland? Can't find any references on Google.

[confused_buyer]

AJS- said:

What did he say about Northern Ireland? Can't find any references on Google.

He was a member of "Troops Out" in the 70's and 80's. Apparently (according to some articles I've seen) he did say some unpleasant things. It was a long, long time ago though.

Apart from that, he's written a lot of books and seems to be quite well respected academically. He's definately more of an economist rather than a politician which is why talking actual economics really pissed off the Eurogroup as they don't appreciate inconvenient things like facts.

[AJS-]

Fairly standard stuff for a left teenager at the time then. Though no less unpleasant for that.

His idea of bonds tied to economic performance certainly seems a sensible way of aligning the interests of debtor and creditors.

[Mark Benson]

confused_buyer said:

Apart from that, he's written a lot of books and seems to be quite well respected academically. He's definately more of an economist rather than a politician which is why talking actual economics really pissed off the Eurogroup as they don't appreciate inconvenient things like facts.

As far as the EU is concerned, this is a political, not an economic situation.

if it were simply economic Greece would never have joined the Euro, and even if they did - as mentioned above this has been going on for 6 years now, it could have been resolved in 6 months if the will was there.

[EskimoArapaho]

confused_buyer said:

Apart from that, he's written a lot of books and seems to be quite well respected academically. He's definately more of an economist rather than a politician which is why talking actual economics really pissed off the Eurogroup as they don't appreciate inconvenient things like facts.

A view shared by Armstrong (whose spelling and fondness for doom-laden hyperbole are annoying but needn't get in the way), and explains why pesky Varoufakis was excluded from the last EZ FinMins meeting.

[turbobloke]

AJS- said:

I think the worst aspect of the whole fiasco is the time it has all taken. 6 years - the duration of WW2. 18 successive quarters of recession. It will blight a generation.

Had they reverted to Drachma in 2010 (as they must surely do eventually) it's hard to imagine that they would be in a worse position now.

Agreed. No parallel makes for a perfect comparison but look at Iceland now compared to 2008. If Greece was only 2 years behind the curve their prospects would be massively better than they are now following EU can kicking for the benefit of the EU's ego polishers and pension-potters not of Greeks.

[maffski]

confused_buyer said:

The whole point of a central bank is that it is lender of last resort. The ECB has simply decided not to fulfill this role with Greece. It sounds small semantics but the fact that it hasn't will have serious ramifications when other countries start getting into more trouble (which they will, beacause the Euro is fundamentally flawed) in the future.

Whilst I'm sure it's not a nice experience for the Greek people or businesses the ECB is really doing them a favour. This is what default will feel like for quite a while, if a week of 'being in arrears to the IMF' had been working ATMs and life as normal people might have been more inclined to think 'this isn't so bad, oxi it is'.

At least now they can make an informed decision - years as a zombie nation like they have been, or the (relatively) short (and very) sharp shock of a default.

[PugwasHDJ80]

Art0ir said:

confused_buyer said:

I can't say I often agree with Communist/Marxist economist who delighted in British Soliders getting blown up in Northern Ireland but Varoufakis did talk a lot of sense in the interviews I saw yesterday.

The is no hope whatsoever of any sort of stability in the short or medium term or any hope of anyone ever seeing any money if the Greek economy can't start growing again (even stopping it shrinking any more would be an achievement).

I wasn't aware of his views on Northern Ireland (or why he would even have any), but I do think plenty on PH are blinded by the left/right paradigm, where everything that comes from the right is spot on even if a little extreme at times and everything from the left is wrong either by virtue of naivety or jealousy.

is there a left or right in this case? i'd struggle to identify them!

[Steffan]

Mark Benson said:

confused_buyer said:

Apart from that, he's written a lot of books and seems to be quite well respected academically. He's definately more of an economist rather than a politician which is why talking actual economics really pissed off the Eurogroup as they don't appreciate inconvenient things like facts.

As far as the EU is concerned, this is a political, not an economic situation.

if it were simply economic Greece would never have joined the Euro, and even if they did - as mentioned above this has been going on for 6 years now, it could have been resolved in 6 months if the will was there.

EskimoArapaho said:

confused_buyer said:

Apart from that, he's written a lot of books and seems to be quite well respected academically. He's definately more of an economist rather than a politician which is why talking actual economics really pissed off the Eurogroup as they don't appreciate inconvenient things like facts.

A view shared by Armstrong (whose spelling and fondness for doom-laden hyperbole are annoying but needn't get in the way), and explains why pesky Varoufakis was excluded from the last EZ FinMins meeting.[/quote

Mark Bendon is correct in his suggestion that this could and should have never taken place. This should also have been resolved in 6 months. confused buyer is spot on on his reminder that Varoufakis is an excetionally able economist. This is the reason thatthe EU leaders wanted him out of duscussions, because they cannot face the economic broadside he fires occasionally. Eskimo Arapaho is also spot on with his reminders that the EU leaders want an easy ride and truthfullness is unwelcome in their game.

We are where we are and the EU is where it is on ths nonsense. I cannot see how the credibility of the EU has not been seriously damaged by this nonsense. The whole bail out of Greece has been a disaster. Underfunded from the start and based upon fallacious Greek figures suggesting recovery, which were accepted, like patsies, without proper enquiry,by the EU. The EU has no regard for reality and the truth. Fortunately and as ever, reality and the the truth will out. And here we are!

What now for the EU, must be the question on this nonsence? Greece sadly, is not going to recovery economically, particularly with the inexperienced Syriza party in charge and spouting Socialism as the answer. I can see little choice for the EA but to accept the fall out of Greece. That will be a real distater for Greece, but a self inflicted disaster.

Question then is what are the consequences to the EU? At best deeply serious and permanent loss of credibility in financial management and many years of effort to hopefully Rebuild that credibility I think. However Iif another country seeks to eave the EU following on the Greek nonsense then I think the EU will be permanently damaged as a secure investment and all hope of expandion and further growth has gone for the EU.

Which gives the piquancy of the Cameron Referendum in the UK a real cutting edge. Cameron may well get many of the changes he is seeking. The real fly in the ointment, to my mind, is that I am highly doubtful that Cameron can actually achieve a majority in favour of the UK remaining within the EU at that Referendum. 4.000,000 voters for UKIP at the recent GE are most unlikely to vote in favour of that proposal. I seriously doubt Canerons ability to deliver a yes vote. Could well get very, very interesting indeed.

[Andy Zarse]

They'll just have another referendum until they get the right answer...

[Andy Zarse]

They'll just have another referendum until they get the right answer...

[Vaud]

Andy Zarse said:

They'll just have another referendum until they get the right answer...

Merge Greece with Scotland?

[Pan Pan Pan]

PugwasHDJ80 said:

Art0ir said:

confused_buyer said:

I can't say I often agree with Communist/Marxist economist who delighted in British Soliders getting blown up in Northern Ireland but Varoufakis did talk a lot of sense in the interviews I saw yesterday.

The is no hope whatsoever of any sort of stability in the short or medium term or any hope of anyone ever seeing any money if the Greek economy can't start growing again (even stopping it shrinking any more would be an achievement).

I wasn't aware of his views on Northern Ireland (or why he would even have any), but I do think plenty on PH are blinded by the left/right paradigm, where everything that comes from the right is spot on even if a little extreme at times and everything from the left is wrong either by virtue of naivety or jealousy.

is there a left or right in this case? i'd struggle to identify them!

Exactly, Right wing governments in Greece have been just as disastrous (helped of course by the population, who just loved taking money for nothing) in running the country, and in using the billions received from the EU to maintain the practices (some almost medieval) which have prevented Greece from developing their country into a productive, modern 21st century economy.
The population voted for Tsipras because he kidded them into believing he had a cunning plan to magic away all the countries debt, (whilst not requiring them to make any changes whatsoever) which would actually improve their situation.
They have had the party for at least 25 years, but now they don't want to pay the bill (not least because they refused to change and develop anything that would actually help them to pay the bill)

[Mermaid]

So how do we expect currency/stock markets to react Sunday night/Monday? A damp squib or a big swing?