Is the end nigh for the Euro? [vol. 3]
Discussion
gruffalo said:
France, Italy, Portugal and Spain don't have that kind of money to lose.
I can see a deal being done to kick the can even further down the road!
But they need money, but are unwilling and unable to finance the debt interest on what they've borrowed, at very low rates, never mind borrowing more to increase both cost of credit and total debt.I can see a deal being done to kick the can even further down the road!
Something has to give.
Either they continue with austerity measures and the public vote out even more tersely, or the other EU countries lose wealth in order to keep them in.
There is no other way. Can kicking costs money... so who will pay?
Greeks can't, but other wealthier countries can. But will the public in those countries want to?
This is the end game for the EU/Euro... but as said, it could be long and drawn out and fairly painful, with even more dire and desperate attempts at grand unifications and other such bonkers ideas, before a final collapse.
How long it takes, depends on how long the unelected pigs want to keep their neo-socialist gravy train jobs going for.
Dave
Well fair play to CMD, he seems to be sticking to his promise to renegotiate, and it is not as if the EU have the money or the economic tack record to pretend that all is rosy in the Garden.
One of the best concessions cmd won from Europe a while back was that only Eurozone members would be on the hook for currency related bailouts.
I know we chucked Ireland a pile of notes, but frankly that was self interest in any case.
I love how they have "accidentally on purpose" leaked a plan that shows that they have considered the impacts of a brexit, certainly helps ramp some pressure on the various EU bodies.
DJRC said:
Nothing careless about that leak garg 
As Gargamel and DJRC suggest the repeated unofficial suggestions that various EU member state governments are reviewing the consequences of a Greek exit are clearly part of a plan to soften the consequences of a Grexit. Nothing accidental in these supposed leaks at all.
The real tragedy of this is that had Greece grasped the nettle of really facing their insolvency five years ago and started putting the economy right there might just possibly have been just a tiny (indeed minuscule) possibility of a recovery by Greece. Instead the fiddling has gone on, the position of Greece economically has worsened steadily for five years until a Socialist government has been elected in Greece, committed to not addressing the reality of the problem and in consequence there is no hope of recovery by Greece.
Matter of time now in reality.
All the economic signs indicate that the reality of the Greek economy is that there simply is no longer any possibility that Greece could recover. The country is long past the point of recovery. All about arse saving by the EU now. Hence the leaks. How successful that will be once the reality of Who is picking up the tab (the EU Euro member solvent states, that's Who!) is apparent and admitted by the EU there us going to be a real bun fight.
I do think there are going to be major ructions within the EU over this nonsense. Rightly so given the duplicitous approach of the EU leaders and EU Bankers. I somehow doubt their ability to explain all this way successfully! Real trouble coming here for the EU when this is combined with the widening concerns on many Northern Europe EU members including the UK and all of Scandinavia. Could well be fundamental changes coming to the EU. Interesting times.
Mr Whippy said:
But they need money, but are unwilling and unable to finance the debt interest on what they've borrowed, at very low rates, never mind borrowing more to increase both cost of credit and total debt.
Something has to give.
Either they continue with austerity measures and the public vote out even more tersely, or the other EU countries lose wealth in order to keep them in.
There is no other way. Can kicking costs money... so who will pay?
Greeks can't, but other wealthier countries can. But will the public in those countries want to?
This is the end game for the EU/Euro... but as said, it could be long and drawn out and fairly painful, with even more dire and desperate attempts at grand unifications and other such bonkers ideas, before a final collapse.
How long it takes, depends on how long the unelected pigs want to keep their neo-socialist gravy train jobs going for.
Dave
Is grand unification such a bonkers idea? Isn't it the whole point of the EU & particularly the Eurozone? First the standards, then borders and currency, then fiscal policy, etc....Something has to give.
Either they continue with austerity measures and the public vote out even more tersely, or the other EU countries lose wealth in order to keep them in.
There is no other way. Can kicking costs money... so who will pay?
Greeks can't, but other wealthier countries can. But will the public in those countries want to?
This is the end game for the EU/Euro... but as said, it could be long and drawn out and fairly painful, with even more dire and desperate attempts at grand unifications and other such bonkers ideas, before a final collapse.
How long it takes, depends on how long the unelected pigs want to keep their neo-socialist gravy train jobs going for.
Dave
We all know that Greece will never pay back the debt in real terms to Eurozone members, so we've already had major fiscal transfers.
I know Netherlands, Finland, etc... might not want it, but aren't they too deep in it to back out now? If you consider the complexity of just the UK leaving the EU imagine how difficult it would be for the Netherlands to leave the Eurozone!
Instead of the endgame of the Eurozone ending, it might be the endgame of the Eurozone becoming a proper federal union?
(I think I might be completely wrong on this, hence all the question marks!)
Steffan said:
As Gargamel and DJRC suggest the repeated unofficial suggestions that various EU member state governments are reviewing the consequences of a Greek exit are clearly part of a plan to soften the consequences of a Grexit.
Nothing accidental in these supposed leaks at all.
The real tragedy of this is that had Greece grasped the nettle of really facing their insolvency five years ago and started putting the economy right there might just possibly have been just a tiny (indeed minuscule) possibility of a recovery by Greece. Instead the fiddling has gone on, the position of Greece economically has worsened steadily for five years until a Socialist government has been elected in Greece, committed to not addressing the reality of the problem and in consequence there is no hope of recovery by Greece.
Matter of time now in reality.
All the economic signs indicate that the reality of the Greek economy is that there simply is no longer any possibility that Greece could recover. The country is long past the point of recovery. All about arse saving by the EU now. Hence the leaks. How successful that will be once the reality of Who is picking up the tab (the EU Euro member solvent states, that's Who!) is apparent and admitted by the EU there us going to be a real bun fight.
I do think there are going to be major ructions within the EU over this nonsense. Rightly so given the duplicitous approach of the EU leaders and EU Bankers. I somehow doubt their ability to explain all this way successfully! Real trouble coming here for the EU when this is combined with the widening concerns on many Northern Europe EU members including the UK and all of Scandinavia. Could well be fundamental changes coming to the EU. Interesting times.
It was a BOE report on a Brexit, not Grexit Nothing accidental in these supposed leaks at all.
The real tragedy of this is that had Greece grasped the nettle of really facing their insolvency five years ago and started putting the economy right there might just possibly have been just a tiny (indeed minuscule) possibility of a recovery by Greece. Instead the fiddling has gone on, the position of Greece economically has worsened steadily for five years until a Socialist government has been elected in Greece, committed to not addressing the reality of the problem and in consequence there is no hope of recovery by Greece.
Matter of time now in reality.
All the economic signs indicate that the reality of the Greek economy is that there simply is no longer any possibility that Greece could recover. The country is long past the point of recovery. All about arse saving by the EU now. Hence the leaks. How successful that will be once the reality of Who is picking up the tab (the EU Euro member solvent states, that's Who!) is apparent and admitted by the EU there us going to be a real bun fight.
I do think there are going to be major ructions within the EU over this nonsense. Rightly so given the duplicitous approach of the EU leaders and EU Bankers. I somehow doubt their ability to explain all this way successfully! Real trouble coming here for the EU when this is combined with the widening concerns on many Northern Europe EU members including the UK and all of Scandinavia. Could well be fundamental changes coming to the EU. Interesting times.
Agree with the post though.
grantone said:
Is grand unification such a bonkers idea? Isn't it the whole point of the EU & particularly the Eurozone? First the standards, then borders and currency, then fiscal policy, etc....
We all know that Greece will never pay back the debt in real terms to Eurozone members, so we've already had major fiscal transfers.
I know Netherlands, Finland, etc... might not want it, but aren't they too deep in it to back out now? If you consider the complexity of just the UK leaving the EU imagine how difficult it would be for the Netherlands to leave the Eurozone!
Instead of the endgame of the Eurozone ending, it might be the endgame of the Eurozone becoming a proper federal union?
(I think I might be completely wrong on this, hence all the question marks!)
i actually think in the grand scheme of things that could well be the natural evolution of things . the current problem is it being rammed down peoples throats too quickly by a bunch of self serving ,unelected ,corrupt idiots.We all know that Greece will never pay back the debt in real terms to Eurozone members, so we've already had major fiscal transfers.
I know Netherlands, Finland, etc... might not want it, but aren't they too deep in it to back out now? If you consider the complexity of just the UK leaving the EU imagine how difficult it would be for the Netherlands to leave the Eurozone!
Instead of the endgame of the Eurozone ending, it might be the endgame of the Eurozone becoming a proper federal union?
(I think I might be completely wrong on this, hence all the question marks!)
as with most things, it could probably have been achieved in a far more efficient manner if there had been no politicians involved.
like you i do not think it would be such a bad thing if done correctly.
wc98 said:
grantone said:
Is grand unification such a bonkers idea? Isn't it the whole point of the EU & particularly the Eurozone? First the standards, then borders and currency, then fiscal policy, etc....
We all know that Greece will never pay back the debt in real terms to Eurozone members, so we've already had major fiscal transfers.
I know Netherlands, Finland, etc... might not want it, but aren't they too deep in it to back out now? If you consider the complexity of just the UK leaving the EU imagine how difficult it would be for the Netherlands to leave the Eurozone!
Instead of the endgame of the Eurozone ending, it might be the endgame of the Eurozone becoming a proper federal union?
(I think I might be completely wrong on this, hence all the question marks!)
i actually think in the grand scheme of things that could well be the natural evolution of things . the current problem is it being rammed down peoples throats too quickly by a bunch of self serving ,unelected ,corrupt idiots.We all know that Greece will never pay back the debt in real terms to Eurozone members, so we've already had major fiscal transfers.
I know Netherlands, Finland, etc... might not want it, but aren't they too deep in it to back out now? If you consider the complexity of just the UK leaving the EU imagine how difficult it would be for the Netherlands to leave the Eurozone!
Instead of the endgame of the Eurozone ending, it might be the endgame of the Eurozone becoming a proper federal union?
(I think I might be completely wrong on this, hence all the question marks!)
as with most things, it could probably have been achieved in a far more efficient manner if there had been no politicians involved.
like you i do not think it would be such a bad thing if done correctly.
I'd simply say two things; history is littered with terrible conflict when countries are forced together against the will of the people. Secondly, the single currency is swiftly being rendered obsolete by technology. As we quickly move to a cashless society I would ask you to explain what on earth is the point of it any more? Have we not reached the point where the massive disadvantages outweigh the perceived benefits (which never really materialised as planned anyway).
wc98 said:
grantone said:
Is grand unification such a bonkers idea? Isn't it the whole point of the EU & particularly the Eurozone? First the standards, then borders and currency, then fiscal policy, etc....
We all know that Greece will never pay back the debt in real terms to Eurozone members, so we've already had major fiscal transfers.
I know Netherlands, Finland, etc... might not want it, but aren't they too deep in it to back out now? If you consider the complexity of just the UK leaving the EU imagine how difficult it would be for the Netherlands to leave the Eurozone!
Instead of the endgame of the Eurozone ending, it might be the endgame of the Eurozone becoming a proper federal union?
(I think I might be completely wrong on this, hence all the question marks!)
i actually think in the grand scheme of things that could well be the natural evolution of things . the current problem is it being rammed down peoples throats too quickly by a bunch of self serving ,unelected ,corrupt idiots.We all know that Greece will never pay back the debt in real terms to Eurozone members, so we've already had major fiscal transfers.
I know Netherlands, Finland, etc... might not want it, but aren't they too deep in it to back out now? If you consider the complexity of just the UK leaving the EU imagine how difficult it would be for the Netherlands to leave the Eurozone!
Instead of the endgame of the Eurozone ending, it might be the endgame of the Eurozone becoming a proper federal union?
(I think I might be completely wrong on this, hence all the question marks!)
as with most things, it could probably have been achieved in a far more efficient manner if there had been no politicians involved.
like you i do not think it would be such a bad thing if done correctly.
Most creatures in nature are territorial in one way or another. Humans are both territorial and tribal. Add to that the concept of Wealth (and equality) and one can see a number of ways in which wide area governments, in the absence of overarching Control Regimes, are likely to find challenges beyond their ability to manage for the long term. In fact once one takes the effects of mass migration into account together with the disproportionate influences that some fluid "groups" of peoples can have (with or without their migration anywhere) thnigs begin to look a bit of a mess.
A currency union may be symbolic and as such the Euro was probably forced through to push the credibility political union (and to hell with the financial risks). However, look at the UK. We have, nominally, a financial Union of a similar nature and have had for some years.
Scotland and Ireland had their own currency issuing mechanisms and the notes and coins that, although nominally Sterling, were for a long time not guaranteed to be accepted by the banks associated with other countries in the Union. (And of course the National Football teams have never been integrated. Now that would be an achievement ....) That "Local Currency" situation in the UK is still not entirely eliminated and, indeed, there seem to be suggestions that pacifying the Scots through devolution would be likely to lead to a return to splitting the currency issuing authority once again. Well, no surprise their - much of Ireland disappeared from the Union at one point along with it's visible use of the Pound Sterling.
Moreover there is this odd situation whereby it seems that whilst the EU seeks to attract ever more members from parts of the globe that have relatively peripheral involvement with recent "European" core history (even though the "Core" group is not yet especially unified politically), there are individual areas of countries in Europe that seek greater autonomy. The UK is a prime example of that with Scotland and Wales having devolved responsibilities and so joining Northern Ireland which has been doing its own thing anyway. One might include London too in some ways. The recent announcement that Manchester will also be given greater local autonomy is yet another example.
At the moment I don't think it is clear to anyone how the introduction of such local autonomy - especially for fiscal matters - fits with the "One Europe" concept, especially for financial management.
Potentially local autonomy (or some aspects of it) is a good means of extending true democracy into the population allowing local people to make local decisions. Or at least that is the theory. However it becomes somewhat meaningless without control over funding and the revenue streams to deliver the funding. If such things prove problematic for the extended EU in the context of little Greece (for example,) how on earth would devolved revenue and spending controls be implemented successfully under the current conceptual "regime"? The EuroZone, if allowed by its members, might want to sit back and see how the UK handles the transition now that promises have been made.
They might also want to reflect on the apparent long term strengths and weaknesses of the UK "Union" in terms of political and social integration as well as the fiscal aspects and then project the "lessons" for 200 years of "One Europe".
At least the UK had the general advantage of a common language (for most of the people most of the time and ignoring some of the more extreme local dialects!).
However the UK was a union formed and "case hardened" at a time of huge progress, especially industrial and territorial, for the islands involved. Burying their differences (up to a point) made sense since the main wealth benefits to be obtained were in and through trade with the wider world rather than local lands. The UK, and GB in particular, made a case for a strong economic unit when brought together in those times. Not the least important aspect were the sources of raw materials required at the time. That element of the "bonding" has all but disappeared in recent times. The balance has changed.
In the expanded EU "the market" seems to be the only selling point. This is the problem for Greece - economically it has nothing much to bring to the table to justify any need for the rest of the members to support it in troubled times. Moreover the way it is going it's not a great consumer either. "Not a bad leisure area for a few months each year" may not be enough in a "union" with a very short history.
Sorry but we aren't in a currency union or anything close. The Scottish banks issuing notes are not analogous to anything that happens in the Eurozone.
Nor would FFA give the Scottish Parliament the ability to issue debt without central approval nor debase Sterling.
We have total freedom to enable fiscal transfers. Google Barnett formula.
When the Scots proposed it post-independence, the refusal was deafening.
The Euro was created to fail. Currency union with such disparate economies and no fiscal transfers could never work. The failure was a necessary step to create a crisis that would force fiscal union. Fiscal Union would then force political union. I heard these words from Jacques Delors. The Eurocrats knew that the population did not want a United States of Europe but have tried to engineer one by the back door. So far, they are succeeding.
Nor would FFA give the Scottish Parliament the ability to issue debt without central approval nor debase Sterling.
We have total freedom to enable fiscal transfers. Google Barnett formula.
When the Scots proposed it post-independence, the refusal was deafening.
The Euro was created to fail. Currency union with such disparate economies and no fiscal transfers could never work. The failure was a necessary step to create a crisis that would force fiscal union. Fiscal Union would then force political union. I heard these words from Jacques Delors. The Eurocrats knew that the population did not want a United States of Europe but have tried to engineer one by the back door. So far, they are succeeding.
Isn't the key issue that even if Federal Europe is the way to go given some countries are vastly worse off and others vastly better off going into a federal setup would mean totally rebalancing the debts.
Rewarding the inept punishing the shrewed.
Also headline news today Greece confirms it cannot pay the next instalment due in a matter of days .....
Rewarding the inept punishing the shrewed.
Also headline news today Greece confirms it cannot pay the next instalment due in a matter of days .....
Welshbeef said:
Isn't the key issue that even if Federal Europe is the way to go given some countries are vastly worse off and others vastly better off going into a federal setup would mean totally rebalancing the debts.
Rewarding the inept punishing the shrewed.
Also headline news today Greece confirms it cannot pay the next instalment due in a matter of days .....
They couldn't pay the last installment either; so the sleight of hand of using the IMF's own money to pay them back was the last fix. I expect the next payment will be met with another miraculous fix.Rewarding the inept punishing the shrewed.
Also headline news today Greece confirms it cannot pay the next instalment due in a matter of days .....
Two immoveable objects?
'German Finance Minister Wolfgang Schäuble sees no need to discuss “alternatives” or disbursing further aid to Athens, since “Greece has to deliver what it promised” on its current bailout program first, he said in a radio interview.'
http://www.marketwatch.com/story/german-finance-mi...
'German Finance Minister Wolfgang Schäuble sees no need to discuss “alternatives” or disbursing further aid to Athens, since “Greece has to deliver what it promised” on its current bailout program first, he said in a radio interview.'
http://www.marketwatch.com/story/german-finance-mi...
NicD said:
Two immoveable objects?
'German Finance Minister Wolfgang Schäuble sees no need to discuss “alternatives” or disbursing further aid to Athens, since “Greece has to deliver what it promised” on its current bailout program first, he said in a radio interview.'
http://www.marketwatch.com/story/german-finance-mi...
So could we see IMF bailing out ongoing to replace the ECB funds ?'German Finance Minister Wolfgang Schäuble sees no need to discuss “alternatives” or disbursing further aid to Athens, since “Greece has to deliver what it promised” on its current bailout program first, he said in a radio interview.'
http://www.marketwatch.com/story/german-finance-mi...
Or is it all pissing in the wind.
AstonZagato said:
Sorry but we aren't in a currency union or anything close. The Scottish banks issuing notes are not analogous to anything that happens in the Eurozone.
Nor would FFA give the Scottish Parliament the ability to issue debt without central approval nor debase Sterling.
We have total freedom to enable fiscal transfers. Google Barnett formula.
When the Scots proposed it post-independence, the refusal was deafening.
The Euro was created to fail. Currency union with such disparate economies and no fiscal transfers could never work. The failure was a necessary step to create a crisis that would force fiscal union. Fiscal Union would then force political union. I heard these words from Jacques Delors. The Eurocrats knew that the population did not want a United States of Europe but have tried to engineer one by the back door. So far, they are succeeding.
How about the NI banks?Nor would FFA give the Scottish Parliament the ability to issue debt without central approval nor debase Sterling.
We have total freedom to enable fiscal transfers. Google Barnett formula.
When the Scots proposed it post-independence, the refusal was deafening.
The Euro was created to fail. Currency union with such disparate economies and no fiscal transfers could never work. The failure was a necessary step to create a crisis that would force fiscal union. Fiscal Union would then force political union. I heard these words from Jacques Delors. The Eurocrats knew that the population did not want a United States of Europe but have tried to engineer one by the back door. So far, they are succeeding.
http://en.wikipedia.org/wiki/Banknotes_of_Northern...
OK, it's Wikipedia but look deeper ....
That Article doesn't seem to add much.
I am not sure about NI but there is nothing there to suggest that it is anything other than the same as Scotland. In order for a Scottish bank to issue a note, it has to make an equivalent deposit at the Bank of England. They have no authority to issue non-secured notes. So they can't print notes without having the Sterling in the first place.
Currency union is something totally different. It is disparate governments with the authority to borrow unlimited amounts in the same fiat currency. That allows any member to potentially debase the currency. With any fiat currency, the only store of value it represents is confidence.
Neither Scotland nor Northern Ireland governments can print Sterling nor borrow in their own name (allowing them to debase Sterling). The total of Scottish government spending is mandated by Westminster.
I am not sure about NI but there is nothing there to suggest that it is anything other than the same as Scotland. In order for a Scottish bank to issue a note, it has to make an equivalent deposit at the Bank of England. They have no authority to issue non-secured notes. So they can't print notes without having the Sterling in the first place.
Currency union is something totally different. It is disparate governments with the authority to borrow unlimited amounts in the same fiat currency. That allows any member to potentially debase the currency. With any fiat currency, the only store of value it represents is confidence.
Neither Scotland nor Northern Ireland governments can print Sterling nor borrow in their own name (allowing them to debase Sterling). The total of Scottish government spending is mandated by Westminster.
AstonZagato said:
That Article doesn't seem to add much.
I am not sure about NI but there is nothing there to suggest that it is anything other than the same as Scotland. In order for a Scottish bank to issue a note, it has to make an equivalent deposit at the Bank of England. They have no authority to issue non-secured notes. So they can't print notes without having the Sterling in the first place.
Currency union is something totally different. It is disparate governments with the authority to borrow unlimited amounts in the same fiat currency. That allows any member to potentially debase the currency. With any fiat currency, the only store of value it represents is confidence.
Neither Scotland nor Northern Ireland governments can print Sterling nor borrow in their own name (allowing them to debase Sterling). The total of Scottish government spending is mandated by Westminster.
So one would expect that a business person in NI bringing cash to some other part of the the UK in order to buy something by way of trade would have no problems whatsoever. I am not sure about NI but there is nothing there to suggest that it is anything other than the same as Scotland. In order for a Scottish bank to issue a note, it has to make an equivalent deposit at the Bank of England. They have no authority to issue non-secured notes. So they can't print notes without having the Sterling in the first place.
Currency union is something totally different. It is disparate governments with the authority to borrow unlimited amounts in the same fiat currency. That allows any member to potentially debase the currency. With any fiat currency, the only store of value it represents is confidence.
Neither Scotland nor Northern Ireland governments can print Sterling nor borrow in their own name (allowing them to debase Sterling). The total of Scottish government spending is mandated by Westminster.
However it seems that within the rules of banking (as it currently exists) that may be considered to be a "grey area" and possibly subject to "money laundering" regulations.
Ignoring, for a moment, the veracity of such a situation, why on earth would it have any potential to exist in the first place?
When is a "single currency" NOT a single currency?
Perhaps when it's a fiscal Union rather than a Political union?
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