This is desperately sad and upsetting (Greek Crisis)

[Digga]

AJS- said:

But there was also growth at that time. Reasonably healthy growth at 2-3% a year.

On conversion to the Euro (and this is by no means restricted to Greece, but also seen in other Eurozone nations, such as Spain) the prices of certain goods rose considerably, enough to create phantom GDP growth. Price inflation is not 'good' growth.

[Axionknight]

Digga said:

AJS- said:

But there was also growth at that time. Reasonably healthy growth at 2-3% a year.

On conversion to the Euro (and this is by no means restricted to Greece, but also seen in other Eurozone nations, such as Spain) the prices of certain goods rose considerably, enough to create phantom GDP growth. Price inflation is not 'good' growth.

Even in the housing market?

[Guvernator]

Great post andymadmac and generally in line with my feelings. Point 7 is always the shocker for me and not just restricted to Greece. In many countries in that region, people can retire in their early 40's on full salary. Nice if you can get it but how on earth anyone could think that was a viable and affordable long term strategy is beyond me.

The other issue off course is the march of "progress" and all the baubles, trinkets and trappings of a modern western society that entails. Most of the countries in that region were perfectly self sustaining when agriculture and farming were their mainstay but now that almost everyone has bought into the modern technological lifestyle, living on a farm is not seen to be good enough any more hence the migration of large percentages of the population to expensive cities, the thirst for modern gadgets and luxury cars which has huge inflationary pressures and has given rise to the unsustainable "credit" generation.

Add to this the fact that due to the decline in agriculture, they can no longer effectively feed themselves so have to start importing food and you can see why nations which been relatively economically stable for so long are now struggling, "improved" lifestyle over stability?Brave new world indeed.

[williamp]

Great post, i understand all of that apart from the haircut bit. What does this mean?

[andymadmak]

williamp said:

Great post, i understand all of that apart from the haircut bit. What does this mean?

A 25% haircut means that essentially 25% of the debt to each lender is written off.

[anonymous-user]

williamp said:

Great post, i understand all of that apart from the haircut bit. What does this mean?

It means that the lenders need a good haircut, so the dunces' caps they now need to wear, for getting into this mess in the first place, fit.

[Guvernator]

None of it is real money anyway otherwise who would realistically be able to right off billions of debt at a single stroke? The made up figures in your debit or credit column just determine who gets to push your country around and\or vice versa which is all used to keep the mutual financial circle jerk going.

[Andy Zarse]

NoNeed said:

I suspect that the rest of Europe is not bothered by Greece leaving, they are worried that Greece leaves and becomes a success story.

Here's a question; is the Eurozone made strong or weaker if Greece leaves?

[andymadmak]

Andy Zarse said:

NoNeed said:

I suspect that the rest of Europe is not bothered by Greece leaving, they are worried that Greece leaves and becomes a success story.

Here's a question; is the Eurozone made strong or weaker if Greece leaves?

Hmm

Well the currency is likely to be slightly stronger in terms of its trading value (loss of its weakest member)

But the idea of the Euro as a single currency for all of Europe, and the credibility that such a thing could be made to work without political union will be holed below the water line..

[anonymous-user]

Andy Zarse said:

Here's a question; is the Eurozone made strong or weaker if Greece leaves?

If it leads to Eurobonds or similar, stronger, otherwise will drag on from one crisis to another until an anti-eu/nationalist/communist party wins a bigger country. IMO

[barryrs]

The construction of the Rio–Antirio bridge sums up the Greek situation quite well in my mind.

A grand vanity project that cost 630,000,000 euros with a projected crossing rate of just 11,000 vehicle's.

So only 5,700 euros per vehicle to date or 477 euros per crossing over its 120 year life cycle.

Good job they are going to cover this with a 20 euro charge per car eh!!!

ETA

Course you can guess which two euro nations benefited most from the construction.

Edited by barryrs on Tuesday 7th July 16:17

[Guvernator]

barryrs said:

Course you can guess which two euro nations benefited most from the construction.

Yep it's like me lending someone money because they are hard up but then saying you have to pay me back with interest AND you can only spend the money I give you in my shop. Then when you've spent it I lend you more money so that you can pay back the interest on the money you already owe me. Some unscrupulous loan sharks could learn a lesson or two from these guys. You couldn't make it up.

[XM5ER]

Not sure if this chap has been quoted on here yet.

http://www.armstrongeconomics.com/

and more specifically this http://s3.amazonaws.com/armstrongeconomics-wp/2011...
written in 2011.

I've never seen a better write up of the history of this whole mess and it makes so much sense. There is a lot to read and it really gets to the nitty gritty about half way through. Worth the effort of you have the time.

[McTory]

barryrs said:

The construction of the Rio–Antirio bridge sums up the Greek situation quite well in my mind.

A grand vanity project that cost 630,000,000 euros with a projected annual crossing rate of just 11,000 vehicle's.

So only 5,700 euros per vehicle to date or 477 euros per crossing over its 120 year life cycle.

Good job they are going to cover this with a 20 euro charge per car eh!!!

ETA

Course you can guess which two euro nations benefited most from the construction.

11,000 per day

not per year

[barryrs]

McTory said:

11,000 per day

not per year

Whoops.

[pork911]

Blackpuddin said:

I remember years ago when I used to holiday in Greece every year (before I got fed up by the way they were p*ssing away the beauty of their own country), one popular method of avoiding tax was to never complete house extensions. The tax law said that as long as work was ongoing you didn't have to pay tax on it. Ergo the place was absolutely littered by houses with unfinished upper storeys.

strong irony - a tourist bemoaning the effects of tourism

[Ean218]

Guvernator said:

Great post andymadmac and generally in line with my feelings. Point 7 is always the shocker for me and not just restricted to Greece. In many countries in that region, people can retire in their early 40's on full salary. Nice if you can get it but how on earth anyone could think that was a viable and affordable long term strategy is beyond me.

Agreed. On R4 Today this morning there was some Greek chap bemoaning his lot. His pension had been cut from 2,500 euros per month to 1200. He didn't think it fair that he had worked hard for 35 years and they now did this to him.

He was aged 56.

I am 55 and have just had my NI contribution statement and it shows I have paid 39 years of NI. I cannot retire for another 10 years and all the government are promising me is £7500 pa.

So he's already worked less than me, retired 10 years earlier than me and already gets more pension than me. How on earth is that economically sane?

[RobinBanks]

barryrs said:

The construction of the Rio–Antirio bridge sums up the Greek situation quite well in my mind.

A grand vanity project that cost 630,000,000 euros with a projected crossing rate of just 11,000 vehicle's.

So only 5,700 euros per vehicle to date or 477 euros per crossing over its 120 year life cycle.

Good job they are going to cover this with a 20 euro charge per car eh!!!

ETA

Course you can guess which two euro nations benefited most from the construction.

Edited by barryrs on Tuesday 7th July 16:17

Is France and Germany the correct answer? I have no idea who the contractors were.

[vournikas]

RobinBanks said:

barryrs said:

The construction of the Rio–Antirio bridge sums up the Greek situation quite well in my mind.

A grand vanity project that cost 630,000,000 euros with a projected crossing rate of just 11,000 vehicle's.

So only 5,700 euros per vehicle to date or 477 euros per crossing over its 120 year life cycle.

Good job they are going to cover this with a 20 euro charge per car eh!!!

ETA

Course you can guess which two euro nations benefited most from the construction.

Edited by barryrs on Tuesday 7th July 16:17

Is France and Germany the correct answer? I have no idea who the contractors were.

Main contractor was Vinci Construction

[Cheese Mechanic]

NoNeed said:

I suspect that the rest of Europe is not bothered by Greece leaving, they are worried that Greece leaves and becomes a success story.

Yup. Low tax, nimble economy. Everything that fks up lefty big tax , big state posturing.