Greece

[frankus]

The truth is we're living beyond our means and we probably need a correction [your equivalent of going backwards] but if people are not prepared to accept it what then? The Greeks are on the brink and my guess is they'll take the view that they'll take us with them when they go ...

I'm not sure it's a truth, that we're living beyond our means when 1% of the populace owns 40% of the assets.

That's got to change, and when it does (with catharcism, because people don't readily give up their comforts - real or imagined), there will be progress.

Progress is subjective, so what upsets a privileged candy tufted toff is probably better for the rest of us.

Progress is the resultant force (for better or worse) in a situation, people technically can't fight progress; they can fight someone elses belief of what is progress - the result will be progress, the struggle will fuel progress even if it leads to an evolutionary cul-de-sac or cultural extinction.

The notion of ownership of progress is flawed and Boris is trapped in the middle of that with "his progress" and "their progress" - there's progress and the violence of it's procession amongst people is the only thing we really collectively control.

Progress is innevitable, favourable progress for "us" not necessarily so. This "tragic" condition is called optimism or hope - but if he were to couch it as absolutely in those terms he'd be doomsaying, which is far too tabloid for the torygraph isn't it? It's not, the tele shovels the same shit it just refers to it as faeces to appease the effete.

What is happening in Greece is people being placed in a situation where they can point out the flaws because they've none of the comforts that balance the equation for most of us - what Fleming called "the quantum of solace" - while there's a jot of comfort we won't protest.

As with any unknown upheaval - it is the child-like nature in people to fear (where's the optimism, Boris?) fear the unknown and imagine all sorts of dreadful things that mean all sorts of crazy actions to avoid an unknown change. If the net change of the EU collapsing was 4 day working weeks for half the money and costs of living to drop back to realistic levels, so that children can leave home at 18 - who would worry? Who would fear that? What if money is devalued so that community and other values outstrip it? Who'd really lose out?

The truth is, if you're in the top 20% of society you've probably got the wit to adapt after any upheaval and will again be in the top 20% it just might be that the currencies used to determine that are more complex than the number of beamers you own

[ianpdq]

Can someone tell me who Greece owes all this money too and why they just don't go bankrupt and start again

[Fretwired]

Can someone tell me who Greece owes all this money too and why they just don't go bankrupt and start again

There are many reasons, but at a basic level services like healthcare would fail as they wouldn't have a hard currency with which to buy drugs. The same would be true of oil, petrol, and food. Society could just collapse. The country's broke and nobody will lend them money if they simply default. My guess is the Euro world will evolve into two halves - the German led northern bloc with all the money and the southern bloc with all the debt. The southern bloc will be given freedoms to rebalance their economy [the strict rules surrounding Euro membership is killing the likes of Greece and Spain].

[evilmags]

Can someone tell me who Greece owes all this money too and why they just don't go bankrupt and start again

Largely German and French banks last time I looked. Greece only worked as it was able to print money. It always had high levels of inflation, endemic tax avoidance and deep rooted political corruption. A permanantly weak currency is usualy a sign of misgovernance and corruption. (Look at the Italina lira versus the Deutschemark for a historical perspective). Greece should default and call the Eurozone's bluff. Unless they march in there with tanks I cannot see how you can stop Greek people using euros. Other countries that are not even EU members use the euro as a defacto currency (Serbia, Montenegro ect). The assumtion that Greece would have to leave the euro if it defaults (which it aready all but has) is unproven to say the least.

Spain would benefit hugely from leaving as a peseta would fall about 20% vs the Euro and help the banks clear all the property of their books (nearly 2mn unsold homes). It has serious industries and agriculture and a restoration of competativeness would solve its deepest issues (Unemployment). Greece is regarded as too iresposible by its own people, many of whom remember the last time it went bust and their savings were wiped out, which is why the people cling to the Euro. Most of Greece's deficit is interest repayments so the government could run itself if it defaults.

It was a fairly predictable mess to be honest but political vanity is impeding a sensible solution. The Germans are really stuck. They either bail out their own banks or they bail out the countries they have lent all the money too.

[ianpdq]

Thank Guys Still as clear as mud

[A5D5E5]

Greece is just one of the more extreme examples of a disease which has affected most countries in the developed world - politicians have bought popularity by promising the population unaffordable benefits (be that pensions, health or social, care, infrastructure or whatever) and borrowing money to pay for their spending habit. They have relied on the populations being too stupid or too greedy to refuse the bribes.

Despite the way the politicians try to present it, these debts are not being paid off - in the UK for example they are simply trying to slow down the rate of increase in the outstanding debt. Therefore, the debt has to be refinanced regularly - that is to say find a new lender who will give you a bigger loan with which you will lay back the loans due for repayment and use the surplus to pay for this years bribes.

At some point (and that point differs according to many factors, but some important ones are monetary sovereignty, track record on paying debts and political stability) lenders start to question whether they should lend you any money, demand higher interest rates because of the risks or refuse to lend at all. When a country reaches this point it is screwed as it will very quickly run out of money and have to default. After this of course, borrowing becomes even harder.

The policies in many of these countries of creating an ever larger public sector reliant like junkies on government or local government funding have only made it harder to make the changes needed to get finances back to a sustainable level.

The euro zone problems were predicable and predicted. Sadly, anyone who made such predictions was abused as a small minded, little englander, tied to an unreasonable love of sterling and standing in the way of the entirely positive creation of the Euro by the largely europhile media.

[evilmags]

Greece is just one of the more extreme examples of a disease which has affected most countries in the developed world - politicians have bought popularity by promising the population unaffordable benefits (be that pensions, health or social, care, infrastructure or whatever) and borrowing money to pay for their spending habit. They have relied on the populations being too stupid or too greedy to refuse the bribes.

Despite the way the politicians try to present it, these debts are not being paid off - in the UK for example they are simply trying to slow down the rate of increase in the outstanding debt. Therefore, the debt has to be refinanced regularly - that is to say find a new lender who will give you a bigger loan with which you will lay back the loans due for repayment and use the surplus to pay for this years bribes.

At some point (and that point differs according to many factors, but some important ones are monetary sovereignty, track record on paying debts and political stability) lenders start to question whether they should lend you any money, demand higher interest rates because of the risks or refuse to lend at all. When a country reaches this point it is screwed as it will very quickly run out of money and have to default. After this of course, borrowing becomes even harder.

The policies in many of these countries of creating an ever larger public sector reliant like junkies on government or local government funding have only made it harder to make the changes needed to get finances back to a sustainable level.

The euro zone problems were predicable and predicted. Sadly, anyone who made such predictions was abused as a small minded, little englander, tied to an unreasonable love of sterling and standing in the way of the entirely positive creation of the Euro by the largely europhile media.

Agree with everything written, there and very well put. The other real problem is that different countries have very different levels of productivity. Locking them into a currency union caused credit bubbles at a private level in the med states and led to ruinious housing bubbles, especially in Spain. Still you can now buy a 3 bedroom flat off a Spanish bank for €30,000 if anyone wants to escape to the sun.

[A5D5E5]

Still you can now buy a 3 bedroom flat off a Spanish bank for €30,000 if anyone wants to escape to the sun.

Never mind a 3 bedroom flat, you could probably pick up an "as new" Spanish airport for about €30,000!

[evilmags]

Never mind a 3 bedroom flat, you could probably pick up an "as new" Spanish airport for about €30,000!

The Ghost towns outside Madrid are ace if you actually have a job. My brother in law rents a 5 bedroom house with a swimming pool and garage for under €400 a month.

[donald39]

Some rather disappointing reads on this thread. Do some reading and thinking please.

The problem is globalisation of financial markets combined with non-isolated currency. You can't print money unless you control all the money in the world. More euros in the market compared to the same amount of everything else makes euros less valuable. Why does this need to be explained?

The problem is not Greece, Greece is an example of neo-liberalist policies which simply put, try to source money from the public to service debts rather than invest in growth. The problem began with Lehmann Bros collapse in 2008 when they found they had a load of shit debt based on unwise loans to people who couldn't pay them. At the same time, property bubbles in Spain and Ireland were waiting to burst. A combination of greed and deregulation results in debt suddenly being a big issue (while capitalism is predicated on debt, the markets are predicated on panic). The political class reveals itself as a front for the banking system by nationalising the banks' private debt, and using public money to bail them out. Then the banks stop lending to each other because the whole atmosphere is poisonous. result - more pubic money please in the form of tax and inflation.

It's not an issue of politics, union, currency, nationalism or partisanship. It is a basic problem of "democratic" capitalism which has happened many times before. Please get familiar with wikipedia and read some stuff if you want to understand.