Greece Watch...

[kenneal - lagger]

There is talk that all these negotiations have been to allow time for the banks to isolate themselves from the Greek debt. How successful that has been we shall see.

[energy-village]

There is talk that all these negotiations have been to allow time for the banks to isolate themselves from the Greek debt. How successful that has been we shall see.

The ECB has been buying up Greek debt (from European banks) for some time.

I suppose ultimately they can print that lot away. I'm sure someone has to lose out somehow; taxpayers probably.

[UndercoverElephant]

There is talk that all these negotiations have been to allow time for the banks to isolate themselves from the Greek debt. How successful that has been we shall see.

They can't isolate themselves.

[Lord Beria3]

http://www.guardian.co.uk/world/2012/fe ... rts-prices

Iran has warned that it could cut off oil exports to six European countries in retaliation for the latest sanctions imposed on the regime, causing turmoil in the world's crude market.

Iran's state-run English language television, Press TV, initially reported on Wednesday that Tehran had stopped exporting oil to the Netherlands, Greece, France, Portugal, Spain and Italy, which resulted in oil prices jumping up as much as $1 a barrel.

The Greeks are relying on Iranian oil at the moment, if these reports are true, this is going to be a heavy hit on a already troubled economy.

Watch this space folks.

[pixelwitch]

There is talk that all these negotiations have been to allow time for the banks to isolate themselves from the Greek debt. How successful that has been we shall see.

I read this somewhere..

http://hat4uk.wordpress.com/2012/02/16/ ... s-default/

[vtsnowedin]

I doubt that the Greeks would have to pay in gold after a default, any hard currency should be acceptable, but that probably wont include new improved Drachmas.

I suppose Gold ,silver or platinum would do but who has any amount of precious metal coins available for circulation? Or are you suggesting that US dollars or UK pounds are "Hard currencies"?
They could I suppose issue gold or silver coins minted as Drachmas. That would preclude any inflation worries but where would they get the bullion to mint the coins from considering their current balance of payments.
It would be interesting to see a small country try to return to the gold standard just to see how long it takes to create a currency shortage.

[UndercoverElephant]

There is talk that all these negotiations have been to allow time for the banks to isolate themselves from the Greek debt. How successful that has been we shall see.

I read this somewhere..

http://hat4uk.wordpress.com/2012/02/16/ ... s-default/

Sounds about right, but if the cat is out of the bag already...

[adam2]

I doubt that the Greeks would have to pay in gold after a default, any hard currency should be acceptable, but that probably wont include new improved Drachmas.

I suppose Gold ,silver or platinum would do but who has any amount of precious metal coins available for circulation? Or are you suggesting that US dollars or UK pounds are "Hard currencies"?
They could I suppose issue gold or silver coins minted as Drachmas. That would preclude any inflation worries but where would they get the bullion to mint the coins from considering their current balance of payments.
It would be interesting to see a small country try to return to the gold standard just to see how long it takes to create a currency shortage.

In the near term, yes I would suggest that US dollars or sterling are hard currencies and would be accepted by any major vendor of oil or other imports.
In the longer term I have my doubts about ANY fiat money, but in the near term, UK or USA money should be preferable to new Drachmas.

[vtsnowedin]

I doubt that the Greeks would have to pay in gold after a default, any hard currency should be acceptable, but that probably wont include new improved Drachmas.

I suppose Gold ,silver or platinum would do but who has any amount of precious metal coins available for circulation? Or are you suggesting that US dollars or UK pounds are "Hard currencies"?
They could I suppose issue gold or silver coins minted as Drachmas. That would preclude any inflation worries but where would they get the bullion to mint the coins from considering their current balance of payments.
It would be interesting to see a small country try to return to the gold standard just to see how long it takes to create a currency shortage.

In the near term, yes I would suggest that US dollars or sterling are hard currencies and would be accepted by any major vendor of oil or other imports.
In the longer term I have my doubts about ANY fiat money, but in the near term, UK or USA money should be preferable to new Drachmas.

Certainly preferable but if UE is correct and the Greek exit from the EU is the fuse that detonates the bomb that might only be true for a few weeks or so.
USA fifteen trillion in debt and going under at better then another trillion per year and no possibility of stemming the tide. I think I shall go down to my loading bench and assemble a few rounds. They might be needed sooner rather then later.

[emordnilap]

http://www.irishleftreview.org/2012/02/ ... ts-athens/

[UndercoverElephant]

I suppose Gold ,silver or platinum would do but who has any amount of precious metal coins available for circulation? Or are you suggesting that US dollars or UK pounds are "Hard currencies"?
They could I suppose issue gold or silver coins minted as Drachmas. That would preclude any inflation worries but where would they get the bullion to mint the coins from considering their current balance of payments.
It would be interesting to see a small country try to return to the gold standard just to see how long it takes to create a currency shortage.

In the near term, yes I would suggest that US dollars or sterling are hard currencies and would be accepted by any major vendor of oil or other imports.
In the longer term I have my doubts about ANY fiat money, but in the near term, UK or USA money should be preferable to new Drachmas.

Certainly preferable but if UE is correct and the Greek exit from the EU is the fuse that detonates the bomb that might only be true for a few weeks or so.
USA fifteen trillion in debt and going under at better then another trillion per year and no possibility of stemming the tide. I think I shall go down to my loading bench and assemble a few rounds. They might be needed sooner rather then later.

At the end of the day, all the countries outside the eurozone who are also in serious trouble (including the US, Japan, the UK and several other non-eurozone EU countries) can print money. I believe they will see this as infinitely preferable to defaulting, especially after the world has witnessed the chaos caused by the defaults of Ireland and Portugal and is staring down the barrel of a eurozone-busting Italian default.

That means the economic/monetary bomb that is going to explode in the eurozone is not likely to bring about the final economic endgame in the rest of the world. What it will do is make the debt problems even worse (by piling extra losses onto non-eurozone banks, which will eventually end up on non-eurozone national balance sheets) and cause another global recession (not that the last one ever properly ended.)

The game won't end in the non-eurozone insolvent nations until they run into unsolvable political problems like those which currently exist in the eurozone. It is happening there first because the situation is so much more politically complex.

[vtsnowedin]

The US is already printing and creating money as fast as it can without people breaking out the wheelbarrows. This is rapidly eroding the value of all retirement accounts and accounts payable. The longer they wait to put the brakes on this spending juggernaut the bigger the crash will be.

[UndercoverElephant]

The US is already printing and creating money as fast as it can without people breaking out the wheelbarrows. This is rapidly eroding the value of all retirement accounts and accounts payable. The longer they wait to put the brakes on this spending juggernaut the bigger the crash will be.

And what happens if/when they put the brakes on?

That's the Greek solution - austerity - and it doesn't work either. It doesn't work because "putting the brakes on" inevitably means large numbers of public sector workers losing their jobs at a time when the private sector is in no position to offter them alternative work. This results in the debt going up, not down, even if you deny those people social security payments (which in turn would lead to mass civil unrest.)

Of course the US can spend less. It could get rid of half of its armed forces, for example, and the most serious consequences of doing so would not be the weakening of the US military capability but the removal of all that spending power from the economy.

[vtsnowedin]

The US is already printing and creating money as fast as it can without people breaking out the wheelbarrows. This is rapidly eroding the value of all retirement accounts and accounts payable. The longer they wait to put the brakes on this spending juggernaut the bigger the crash will be.

And what happens if/when they put the brakes on?

That's the Greek solution - austerity - and it doesn't work either. It doesn't work because "putting the brakes on" inevitably means large numbers of public sector workers losing their jobs at a time when the private sector is in no position to offter them alternative work. This results in the debt going up, not down, even if you deny those people social security payments (which in turn would lead to mass civil unrest.)

Of course the US can spend less. It could get rid of half of its armed forces, for example, and the most serious consequences of doing so would not be the weakening of the US military capability but the removal of all that spending power from the economy.

There is more then one way to balance a budget. Instead of laying off twenty percent of a work force you could cut the pay rate of the entire work force twenty percent. You can change retirement rules so that you are entitled to what is actuarially sound based on what you paid in and for how long you paid it in. You can have people work forty hours a week if they want a full weeks pay.
In the US you could amend the constitution so that congress doesn't set it's own pay. Then set it so any deficit reduces there pay by a proportionate amount. You could end any military procurement program set by earmarks and let the pentagon decide what and where to buy from a limited budget.
People say Ron Paul's trillion in cuts the first year is crazy but I think that not cutting it is crazier.

[UndercoverElephant]

The US is already printing and creating money as fast as it can without people breaking out the wheelbarrows. This is rapidly eroding the value of all retirement accounts and accounts payable. The longer they wait to put the brakes on this spending juggernaut the bigger the crash will be.

And what happens if/when they put the brakes on?

That's the Greek solution - austerity - and it doesn't work either. It doesn't work because "putting the brakes on" inevitably means large numbers of public sector workers losing their jobs at a time when the private sector is in no position to offter them alternative work. This results in the debt going up, not down, even if you deny those people social security payments (which in turn would lead to mass civil unrest.)

Of course the US can spend less. It could get rid of half of its armed forces, for example, and the most serious consequences of doing so would not be the weakening of the US military capability but the removal of all that spending power from the economy.

There is more then one way to balance a budget. Instead of laying off twenty percent of a work force you could cut the pay rate of the entire work force twenty percent.

That saves on social security, but it still removes the same amount of spending power from the public. Everybody gets poorer, everybody spends less...

You can change retirement rules so that you are entitled to what is actuarially sound based on what you paid in and for how long you paid it in. You can have people work forty hours a week if they want a full weeks pay. In the US you could amend the constitution so that congress doesn't set it's own pay. Then set it so any deficit reduces there pay by a proportionate amount. You could end any military procurement program set by earmarks and let the pentagon decide what and where to buy from a limited budget.

I agree that there are some cuts which could easily be made (like paying politicians less). But you still have the problem that the current system depends on economic growth and most of your cuts involve reducing the level of disposable income of large numbers of people.