The Counter-Jihad goes full fascist - like we didn't know that before.

[HoreTore]

They've always denied the obvious...

"No no, we're not fascists, we're just critical of Islam! Stop pestering my with your PC!!!"

Well, Gates of Vienna made it official last week, by posting and stickying an open call for a fascist oligarchy (http://gatesofvienna.blogspot.com/2012/02/bee-and-lamb-part-4.html). The only change from the past is that they have swapped "Strong manly virtue" with "high IQ".

The weak masses should be controlled by their stronger superiors. We should have less democracy and free speech, not more!! Of particular hilarity is the call for banning voodoo. Which kinda proves which side of the IQ-metre the author is on. I have a feeling he wont be doing many decisions in his ideal society....

Is this openness a sign of a new direction, though? Will the racist blogosphere turn into an openly fascist blogosphere? Or will they continue going into a fit whenever someone points out the blindingly obvious term on their movement?

[rory_20_uk]

Rather amusingly, you are lumping what is probably a rather diverse grouping of individuals into one amorphous mass - the Black Panthers alongside the KKK.

~:smoking:

[Fragony]

http://zorgvraag.info/wp-content/uploads/2012/02/oxazepam.jpg

^

[HoreTore]

Rather amusingly, you are lumping what is probably a rather diverse grouping of individuals into one amorphous mass - the Black Panthers alongside the KKK.

~:smoking:

I am lumping the contributors to a specific blog, Gates of Vienna, into one mass. That does not seem like that big a stretch to me. Given the lack of any critical comment whatsoever(the only criticism was a theological debate on the nature of Christianity which I found utterly boring), I am inclined to lump their readers into the mass as well.

Given that Gates of Vienna is a pretty big and forceful blog in the not-racist underground, I am asking the question of whether others will follow suit, dump the charade and openly declare themselves as fascists now. That remains to be seen.

[Fragony]

The funny thing about facism is that you can see it everwhere without recognising it

[rory_20_uk]

Apologies. I did not realise that you were referring purely to a group who I take from the Blog's title to be pretty homogeneous. From as much of the blog post that I read there is a strong racial element, although interestingly it seems Jews and Christians are fine, it is broadly speaking everything and everyone else.

The comments are also pre-approved, so any that do not agree with the owner will be binned anyway - hence I much prefer this site where there is a reactive censorship for those that infringe the rules.


"Culture is ending, the polite, old white crowd that savors Bach at the Frauenkirche or Velasquez at the Prado having neither the courage nor the vigor to stop the barbarization of its former domains. The future is writ as the torture of the children of Grieg with the barbarians’ Dika Down Booboo! or their mega-decibel Adhan; the Booboo-Muslim-Morlock crowd multiplying and living off white Eloi’s taxes under Leviathan’s special care"

Strange man...

~:smoking:

[HoreTore]

The comments are also pre-approved, so any that do not agree with the owner will be binned anyway - hence I much prefer this site where there is a reactive censorship for those that infringe the rules.

The comments are pre-approved, but to my knowledge that is only to prevent spam and such. I've posted a couple of times, and my comments have gotten through just fine....


Strange man...

~:smoking:

Indeed.

[Philippus Flavius Homovallumus]

They've always denied the obvious...

"No no, we're not fascists, we're just critical of Islam! Stop pestering my with your PC!!!"

Well, Gates of Vienna made it official last week, by posting and stickying an open call for a fascist oligarchy (http://gatesofvienna.blogspot.com/2012/02/bee-and-lamb-part-4.html). The only change from the past is that they have swapped "Strong manly virtue" with "high IQ".

The weak masses should be controlled by their stronger superiors. We should have less democracy and free speech, not more!! Of particular hilarity is the call for banning voodoo. Which kinda proves which side of the IQ-metre the author is on. I have a feeling he wont be doing many decisions in his ideal society....

Is this openness a sign of a new direction, though? Will the racist blogosphere turn into an openly fascist blogosphere? Or will they continue going into a fit whenever someone points out the blindingly obvious term on their movement?

Before you get too hearty in your demonisation, the bolded also perfectly describes the EU! All you have to do is replace "stronger" with "more enlightened" and it is a perfect fit for what is being said by Germany, and Germans, about Southern Europe - and that also has a racial element too it.

Reactionary racial steryotyping is the result of straightened economic situations, which is why we now see it on both right and left. It's a result of the In Group attacking the Out Group.

[Kralizec]

and it is a perfect fit for what is being said by Germany, and Germans, about Southern Europe - and that also has a racial element too it.


What?

[Lemur]

the Booboo-Muslim-Morlock crowd multiplying and living off white Eloi’s taxes under Leviathan’s special care
As fond as I am of Morlock/Eloi references, you can't go mixing in Leviathan when you're in the middle of a Time Machine riff. No mixing H. G. Wells and Thomas Hobbes; that's just wrong.

[Philippus Flavius Homovallumus]

What?

Well, those Greeks deserve everything they get, right? They're corrupt, and they elect corrupt politicians, so maybe they're stupid too? If only they could practice German fiscal dicipline, but we don't trust them to do that, so we'll grind them down as low as possible before giving them a loan with punitive interest rates.

Give me a break.

What is happening in the Eurozone is being cast as Northern Dicipline vs Southern immorality (because debt is immoral). It's a Germanic Protestant narrative that ignores the basic structural failure of the Euro, thank God the Left-leaning press is waking up over here, at least.

[Kralizec]

Nice attempt at changing the subject, this is not Furunculus' euro thread. I find your insinuation that there are racist sentiments in the way Germany and others are treating Greece incredibly insulting, even more so because it's so subtle.

[Tellos Athenaios]

The big difference being, however, that the Protestant morality play has nothing whatsoever to do with racism and everything with Germany and others refusing point blank to cover the bill, again, while at the same time France and Germany are insisting that Greece must remain part of the euro. These are mutually exclusive unless the Greeks suddenly pay up after all.

Still, the key here is that it really is a Greek option to call it quits but so far their politicians haven't had the guts to do that either. They've professed as have the Germans/French that a break from the euro is impossible, and hence the Greeks continue to pay their bills through convoluted “bail out” schemes. The talk about it being impossible to do is, just that, talk: neither France/Germany nor Greece officially wants Greece to exit the euro, they're just trying to hang on to it for as long as possible. If either party wanted that, the hands would've been forced and the matter concluded months ago.

[Philippus Flavius Homovallumus]

Nice attempt at changing the subject, this is not Furunculus' euro thread. I find your insinuation that there are racist sentiments in the way Germany and others are treating Greece incredibly insulting, even more so because it's so subtle.

It's Gaelic Cowboy's Euro thread, actually, and I'm not being at all subtle.

I'll be explicit: The punishment being inflicted on the Greeks is not just about a futile attempt to preserve the status quo, an impossible feat in any case. No, this is about a prejudice for "feckless Greeks", the belief that the Greek people are at fault for the graft and corruption in their political system and therefore should suffer for it.

The alternative narrative is that the Left-leaning European establishment, and by British standards the European Establishment lacks a Right-leaning element entirely, is pathologically heartless.

The fact is, hammering the Greeks plays well in Germany, and the Netherlands, as the does taking away fiscal soverignty from those percieved not to deserve it, political children if you like.


The big difference being, however, that the Protestant morality play has nothing whatsoever to do with racism and everything with Germany and others refusing point blank to cover the bill, again, while at the same time France and Germany are insisting that Greece must remain part of the euro. These are mutually exclusive unless the Greeks suddenly pay up after all.

Still, the key here is that it really is a Greek option to call it quits but so far their politicians haven't had the guts to do that either. They've professed as have the Germans/French that a break from the euro is impossible, and hence the Greeks continue to pay their bills through convoluted “bail out” schemes. The talk about it being impossible to do is, just that, talk: neither France/Germany nor Greece officially wants Greece to exit the euro, they're just trying to hang on to it for as long as possible. If either party wanted that, the hands would've been forced and the matter concluded months ago.

France and Germany want Greece to default and exit at this point, because the alternative is to provide Greece unlimited credit with low interest rates for the next several decades. Otherwise, Greece's economy will continue to shrink, because sensible spending decisions cannot be made while credit is withheld based on cuts which are, frankly, absurd in scale.

A 22% cut to the minimum wage? Bear in mind the Greek state has already been cutting wages back for the past two years, and it has built up a huge public sector economy which is intertwined with the whole country, cutting back on that will produce the same result as cutting back subsidies for the Noth of england under Thatcher. Long term decline, followed by stagnation and a "recovery" itself fuelled by the State and precious little else.

What Greece needed two years, as I believe I said at the the time and Adrian shouted at me for, was to exit the Euro and THEN recieve a bailout once it had defaulted on its debts and cleared its balance sheet.

[Kralizec]

It's Gaelic Cowboy's Euro thread, actually, and I'm not being at all subtle.

I'll be explicit: The punishment being inflicted on the Greeks is not just about a futile attempt to preserve the status quo, an impossible feat in any case. No, this is about a prejudice for "feckless Greeks", the belief that the Greek people are at fault for the graft and corruption in their political system and therefore should suffer for it.

I do actually believe that the Greeks are responsible. Individuals can't be blamed, but a nation's people, as a collective, is responsible for what their elected government does. Therefore the people of Iceland should be expected to pay for their bloated, failed banking system and the Greeks should pay the price for electing pork-barrel governments for the last 3 decades.



The alternative narrative is that the Left-leaning European establishment, and by British standards the European Establishment lacks a Right-leaning element entirely, is pathologically heartless.

The fact is, hammering the Greeks plays well in Germany, and the Netherlands, as the does taking away fiscal soverignty from those percieved not to deserve it, political children if you like.

You seem to be under the misguided impression that hammering at the Greeks is an exclusively leftist hobby. Maybe that's the case in your country, but it's not in mine, nor in Germany. And I still don't see what any of this has to do with racism.

[rory_20_uk]

Greeks retire at 55.
They get paid a salary for 14 months of the year. Their civil service is massive and inefficient.
They are still less productive than Germany.
Their democratically elected leaders lied to get into the Euro, involving some wizardry courtesy of Goldman Sachs.
Countries such as Slovakia are wondering why they should have to finance a country that is richer than they are.
Countries such as Germany wonder why they have to work something like a further 12 years after the Greeks stop.

To try to play the racism card, you must therefore think that if Denmark was doing exactly the same thing everyone would go "what a shame, here's loads of free money - chin up!" No one signed up for the Euro to be a cuddly institution to help wayward countries whose leaders and peoples just can't seem to pay taxes or have any economic function, bless 'em and hence require vast subsidies from everyone else.

If one were suggesting giving Nigeria £100 Billion one would be considered mad. Yet, their growth is positive, they produce something of value. Greece manages to shrink by 7% in 3 months (illusory growth gained from the EU gravy train previously) and still we pile the money in.

~:smoking:

[Philippus Flavius Homovallumus]

I do actually believe that the Greeks are responsible. Individuals can't be blamed, but a nation's people, as a collective, is responsible for what their elected government does. Therefore the people of Iceland should be expected to pay for their bloated, failed banking system and the Greeks should pay the price for electing pork-barrel governments for the last 3 decades.




You seem to be under the misguided impression that hammering at the Greeks is an exclusively leftist hobby. Maybe that's the case in your country, but it's not in mine, nor in Germany. And I still don't see what any of this has to do with racism.

The Greeks can't pay, so hammering them is pointless. Claiming that "the Greeks" are responsible is also fallacious, just as claiming the UK's position in Europe is our collective "fault". The people vote for the available parties, and in Greek politics as much as anywhere you need money to be a politician.


Greeks retire at 55.
They get paid a salary for 14 months of the year. Their civil service is massive and inefficient.
They are still less productive than Germany.
Their democratically elected leaders lied to get into the Euro, involving some wizardry courtesy of Goldman Sachs.
Countries such as Slovakia are wondering why they should have to finance a country that is richer than they are.
Countries such as Germany wonder why they have to work something like a further 12 years after the Greeks stop.

To try to play the racism card, you must therefore think that if Denmark was doing exactly the same thing everyone would go "what a shame, here's loads of free money - chin up!" No one signed up for the Euro to be a cuddly institution to help wayward countries whose leaders and peoples just can't seem to pay taxes or have any economic function, bless 'em and hence require vast subsidies from everyone else.

If one were suggesting giving Nigeria £100 Billion one would be considered mad. Yet, their growth is positive, they produce something of value. Greece manages to shrink by 7% in 3 months (illusory growth gained from the EU gravy train previously) and still we pile the money in.

~:smoking:

Right, the general Greek populace works a 42 hour week, and though they can retire and draw a pension at 55 most have to keep working because that pension doesn't amount to much. Further, while tax evasion is endemic, it is only so for those able to afford the accountants and the bribes. Those people are still getting rich, the general populace are being hammered.

This is war reparations from Germany all over again.

You want to punish them? Fine. Demand the resignation of all the main political party leaders and the holding of immidiate elections with full UN oversight as well as the publishing the goverment accounts, including a breakdown of defence and infastructure sepnding.

Then, give Greece a low cost loan to fix their infastructure and survive the bang from exiting EMU.

[rory_20_uk]

Years of work to earn a full pension; Greece: 35 Germany: 45
Proportion of wages as pension; Greece: 80% Germany: 46%
Number of pension payments a year; Greece: 14 Germany: 12
Minimum payment; Greece: €450 Germany: €600
Maximum Payment; Greece: €2538 Germany: €2100

They might need to go on working, but less than Germany. The Germans do manage to pay for their pensions.

Punish for punishment sake? No I agree that's pointless. In WW1 culpability was on all sides. Here the blame falls more on Greece alone. Their entire finances should be internationally reviewed for starters, and definitely penalties for the leaders. National assets should be used as collateral for the loans for a long time. Not impossible loans, but loans against most assets that the state currently has. We could even take offshore rights and airspace.

They've stopped being a country in any meaningful sense of the word. Like teenagers, they appear to be refusing to see how independence is directly linked to fiscal responsibility.

~:smoking:

[Philippus Flavius Homovallumus]

Years of work to earn a full pension; Greece: 35 Germany: 45
Proportion of wages as pension; Greece: 80% Germany: 46%
Number of pension payments a year; Greece: 14 Germany: 12
Minimum payment; Greece: €450 Germany: €600
Maximum Payment; Greece: €2538 Germany: €2100

They might need to go on working, but less than Germany. The Germans do manage to pay for their pensions.

Punish for punishment sake? No I agree that's pointless. In WW1 culpability was on all sides. Here the blame falls more on Greece alone. Their entire finances should be internationally reviewed for starters, and definitely penalties for the leaders. National assets should be used as collateral for the loans for a long time. Not impossible loans, but loans against most assets that the state currently has. We could even take offshore rights and airspace.

They've stopped being a country in any meaningful sense of the word. Like teenagers, they appear to be refusing to see how independence is directly linked to fiscal responsibility.

~:smoking:

Ultimate blame for the Greek situation lies with Germany and the architechts of EMU, because Portugal, Ireland and Italy are all going through the same thing - and here's where I detect the whiff of prejudice, Greece gets it in the neck much more than Ireland, and is being asked to make much bigger cuts. The fact is, a large portion of the Greek defecit at this point is about loan repayments.

[rory_20_uk]

No one forced anyone into anything. We're dealing with countries here, who are not supposed to walk into scams.

When I was 18 I was offered a Platinum credit card with a limit of £25k. I had no job. I chose not to take it. Not only did Greece decide to take something that was worse than this, but also lied on the form to become a member.

~:smoking:

[rory_20_uk]

Double post...

[spankythehippo]

Whoa, double post.


Well, those Greeks deserve everything they get, right? They're corrupt, and they elect corrupt politicians, so maybe they're stupid too?

Blaming an entire demographic for the actions of corrupt politicians? Now you're just attacking a straw man. Of course, my words mean nothing, since I don't live in EU.

But I find this informal fallacy rather distasteful.

[Philippus Flavius Homovallumus]

Whoa, double post.



Blaming an entire demographic for the actions of corrupt politicians? Now you're just attacking a straw man. Of course, my words mean nothing, since I don't live in EU.

But I find this informal fallacy rather distasteful.

I find the penury the Greek people are being driven into more than distasteful, and the restrictions being placed upon them are EXPLICITELY stated to be to make sure they keep up their end of the deal.

As I said - if its about the politicians, get rid of them, don't crash the whole ******** economy, it's pointless.

Also take a look at this:


No one forced anyone into anything. We're dealing with countries here, who are not supposed to walk into scams.

When I was 18 I was offered a Platinum credit card with a limit of £25k. I had no job. I chose not to take it. Not only did Greece decide to take something that was worse than this, but also lied on the form to become a member.

~:smoking:

Rory, I think if we're honest, this is much more like every time you wanted something your girlfriend gave it to you, and she was using her dad's credit card.

[rory_20_uk]

I find the penury the Greek people are being driven into more than distasteful, and the restrictions being placed upon them are EXPLICITELY stated to be to make sure they keep up their end of the deal.

As I said - if its about the politicians, get rid of them, don't crash the whole ******** economy, it's pointless.

Rory, I think if we're honest, this is much more like every time you wanted something your girlfriend gave it to you, and she was using her dad's credit card.

The penury is still above the vast majority of the world's population. Deal with it.

The example you give again removes all responsibility that the Greek government had to the situation. To extend your metaphor, even if one's girlfriend is giving one gifts, one should be asking where the money is coming from - and as an adult realise that there are very things free in life. If it wasn't an explicit gift from the source of the money, changes are there will be a bill to pay.

~:smoking:

[Philippus Flavius Homovallumus]

The penury is still above the vast majority of the world's population. Deal with it.

The example you give again removes all responsibility that the Greek government had to the situation. To extend your metaphor, even if one's girlfriend is giving one gifts, one should be asking where the money is coming from - and as an adult realise that there are very things free in life. If it wasn't an explicit gift from the source of the money, changes are there will be a bill to pay.

~:smoking:

The only people paying though are the Greek poor, and reducing them to third world status and saying "deal with it" is not sensible, because if we go on like this we might well have to "deal" with a new Junta.

[Kralizec]

Every layer of the population evades taxes, the rich just are more succesful at it because they can afford professional help.

"Third world status"? The fact of the matter is that Greece has acquired the level of development it has today by financial practices which are obviously unsustainable. I realize that pushing Greece into economic servitude isn't desirable or feasible. Ask again when Greece's minimum wage drops to the level of Poland or Slovakia, at which point your words may have some merit.

I still don't see why the Germans (or anyone else) are racists for demanding that Greece displays financial sense in return for loans.

Carthago delenda est.

Which isn't supposed to imply I want Greece destroyed, it refers to the apparent necessity to keep confronting PVC about his accusations of racism before getting an answer

[Philippus Flavius Homovallumus]

Every layer of the population evades taxes, the rich just are more succesful at it because they can afford professional help.

"Third world status"? The fact of the matter is that Greece has acquired the level of development it has today by financial practices which are obviously unsustainable. I realize that pushing Greece into economic servitude isn't desirable or feasible. Ask again when Greece's minimum wage drops to the level of Poland or Slovakia, at which point your words may have some merit.

I still don't see why the Germans (or anyone else) are racists for demanding that Greece displays financial sense in return for loans.

Carthago delenda est.

Which isn't supposed to imply I want Greece destroyed, it refers to the apparent necessity to keep confronting PVC about his accusations of racism before getting an answer

I'm sorry, how have I not been clear?

I know Greeks who pay taxes, some of them are over here wondering if, you know, they should be going home.

You are making a blanket generalisation about an entire country - all Greeks are lazy and dishonest, just like all Italians and licentacious cowards, and you ask where I detect the whiff of prejudice?

In Greece, people need soup kitches to survive, we're talking lines around the block here. Sure, Greek wages were inflated, but so were Greek expenses, and the latter have continued to got up while the former have fallen.

you are also subscribing to "people = Government", what is happening is that the Greek people are suffering for the sins of Greek politicians, it's not like there was a referendum on the Euro.

For that matter, they're also suffering for the sins of the German politicians who let Greece join despite knowing the books were cooked and were subsequently the first to run defecits that broke the existing fiscal compact.

Lets he who is without sin cast the first stone, eh?

This WILL NOT WORK. More austerity placed on Greece will cause the economy to continue to contract, requireing more austerity to meat loan repayments, causing further contraction, requiring more loans, requiring more austerity to meet repayments, requireing more contraction.

Read Dickens on Debtors Prison, once you go in you can never escape unless someone else pays your way out.

[Beskar]

Still amazes me that intergovernment lending and debt within the UK alone is far more than the Greek Debt. I am surprised that the Greek debt is really such a massive issue everyone is making out it is, especially when there are 27 countries involved.

I am guessing it is mainly due to the lack of fiscal union which makes it a gear-wrenching mess.

[Philippus Flavius Homovallumus]

Still amazes me that intergovernment lending and debt within the UK alone is far more than the Greek Debt. I am surprised that the Greek debt is really such a massive issue everyone is making out it is, especially when there are 27 countries involved.

I am guessing it is mainly due to the lack of fiscal union which makes it a gear-wrenching mess.

That, plus exernal exposure, plus the "Rubicon" of a country leaving the Euro.

[Kralizec]

Oh please. Get off your high horse.

I never, never said that all Greeks are lazy, dishonest or whatever. I said that tax evasion is prevalent in all layers of their society - and that is pretty obvious, because it's the same in the Netherlands, and presumably everywhere else. Off the top of my head, I could name 5 personal friends/acquaintances right now who have held jobs that weren't on the employer's books. And allthough few people would deny the necessity of taxes as such, our fiscal agency isn't exactly the most popular institution of our government. Fact: in Greece, it's worse.

Yes, the other European countries are partly responsible because they were aware that Greece's bookkeeping practices were dubious. You seem to be singling out Germany especially for some reason (are you an anti-German racist?), but whatever. It's still primarily the Greek state which was at fault. And I still maintain that the Greek population carries a lot more fault for what happened to them than German taxpayers, who by the way weren't able to vote on the Euro either, let alone on the entry of basket case countries like Greece.

The truly heartless approach to Greece would have been to let it go bankrupt from the outset, kick them out of the EMU and into certain doom and use the money to bail out affected financial institutes instead. In fact I remember some economists who suggested exactly that when the whole mess started collapsing on itself. Instead, the EU and IMF is lending them money at interest rates which are generously low considering the fact that nobody else would lend to them at all. Yet somehow Germany (in particular) is racist for not helping them enough, and for not providing help without strings attached.

[a completely inoffensive name]

I know a greek guy. Nice dude but he asks too many questions in class. He should probably just wait for office hours.

[PanzerJaeger]

This WILL NOT WORK. More austerity placed on Greece will cause the economy to continue to contract, requireing more austerity to meat loan repayments, causing further contraction, requiring more loans, requiring more austerity to meet repayments, requireing more contraction.


...until Greece reaches a state in which the public sector economy is a manageable proportion of the whole economy. It will be a long, painful process and it will probably bring Greece back to a more realistic GDP, but it is the only viable long term solution, other than permanent European welfare for the nation.

There is certainly room for sympathy in the form of write-offs, but the essential function the repayments represent - that of dismantling the public sector economy - must remain in place. The Greeks will not do it themselves. Reducing the public sector will definitely cause contraction in the short and medium terms, but suggesting that that reality means that it must continue to be propped up ignores the long term and condemns the Greeks to a future of dependence on those awful, racist Germans.

[gaelic cowboy]

There is certainly room for sympathy in the form of write-offs, but the essential function the repayments represent - that of dismantling the public sector economy - must remain in place.

None of this is happeneing the way you think it is

First the write offs are not really write offs when the largest creditor the ECB will not contenance any write down of it's own debt.
This means that people who bought senior debt now find themselves actually not really having senior debt at all, then when the EU/IMF writes stuff down the problem is that CDS get called in and we have a default in the Eurozone.

Also the repayments really represent Greece paying back there OWN central bank with borrowed money :dizzy2: the idea would be laughable except it's not really funny.

Also the state is not being reformed it is being dismantled the same government inefficiencies will still be there after the bailout.

This problem has from the start been missdiagnosed, the rot was in the entire european banking structure since about 2007, we know this now for sure from all the stealth QE the ECB has engaged in by lending billions of low interest loans for 3yrs.(all promptly deposited back with the ECB due to fear of lending to each other)

Interbank lending expanded massively under the ECB and there was no heed paid to it at all, they paid no heed because policy dictated that a Greek Euro was the same as a German one.(the banks believed as did everyone else that sovereigns dont default)

[Philippus Flavius Homovallumus]

The truly heartless approach to Greece would have been to let it go bankrupt from the outset, kick them out of the EMU and into certain doom and use the money to bail out affected financial institutes instead. In fact I remember some economists who suggested exactly that when the whole mess started collapsing on itself. Instead, the EU and IMF is lending them money at interest rates which are generously low considering the fact that nobody else would lend to them at all. Yet somehow Germany (in particular) is racist for not helping them enough, and for not providing help without strings attached.

Kicking them out of EMU, letting them go bankrupt, and calling in the IMF is EXACTLY what should have happened, by now Greece would have returned to growth, not least because a massively devalued Drachma would have put labour costs through the floor and German tourists would be able to spend on holiday, even with inflation. As it is, in the Euro, the inflation in Greece makes it a less attractive place to go, which hamstrings its best short term hope for economic recovery.


...until Greece reaches a state in which the public sector economy is a manageable proportion of the whole economy. It will be a long, painful process and it will probably bring Greece back to a more realistic GDP, but it is the only viable long term solution, other than permanent European welfare for the nation.

There is certainly room for sympathy in the form of write-offs, but the essential function the repayments represent - that of dismantling the public sector economy - must remain in place. The Greeks will not do it themselves. Reducing the public sector will definitely cause contraction in the short and medium terms, but suggesting that that reality means that it must continue to be propped up ignores the long term and condemns the Greeks to a future of dependence on those awful, racist Germans.

No, because the Greek economy has gone into shock and siezed up, just like a man with an arterial wound it is bleeding profusely, the collapse in domestic demand is causing businesses to fold, which has caused foriegn investment to dry up. As a result companies are moving their Euros out of the country on a daily basis, and because Greece is in a currency union that money is not exchanged and told back to the central bank, it just leaves. The same is happening in the bond markets, and the rapid cuts in the public sector are making the situation even worse because the public sector moves oney through the economy, whereas the private sector is currenlty extracting the money and putting it into Germany.

Dismantling the private sector for ideaological reasons is one thing, doing it against economic sense it absurd and dangerous. The way this has been handled makes it likely that none of the major parties in the parliament will be able to form a government after the election, so austerity will not be carried through and Greece will default in any case.

Here's the real dirty secret: Greece only has a defecit because of its debts - managable cuts would be possible if Greece defaulted, but that would upset the European banks, so the Greeks have to wait until everyone else has extracted their money from the country before they can leave EMU and devalue.

[rory_20_uk]

I do not recall strikes and protests in the streets when Greece was set to join the Euro - and if the Government was inflicting such a drastic change on the Greeks this would surely occur.
I do not recall Greek horror at being given the Olympics, even though it is known to suck up a vast amount of money and leave stadia that require a vast population to utilise. There are many in the UK who aren't thrilled that we won it - and only wanted it so that France wouldn't get it. On balance it is something that UK could have done without IMO.

Greek debt has already had a 70% write off. Everybody is paying for Greece's financial practices both directly and indirectly.

The Greeks have a choice: stay in and follow the rules, or leave and have their own rules. Both situations have pros and cons.

I would have kicked Greece out and limited blowback (I would have never let Greece in frankly - and mainly had it as a Norther European alliance). If you want to have one's money doing good in the world, it'll go a lot further giving it to Oxfam.

~:smoking:

[gaelic cowboy]

Here's the real dirty secret: Greece only has a defecit because of its debts - managable cuts would be possible if Greece defaulted, but that would upset the European banks, so the Greeks have to wait until everyone else has extracted their money from the country before they can leave EMU and devalue.

Exactly +1 multiplied by 10 to the power of 12

European banks are sick with debt and euro elites are afraid so they have bailed them out under the guise of saving the Euro. Interestingly the article beloew points out that this new deal requires Greece to achieve 120% debt to gdp as it's felt to be sustainable:dizzy2:

Illusion of Greek bailout is Europe's dirty little secret (http://www.independent.ie/opinion/columnists/david-mcwilliams/david-mcwilliams-illusion-of-greek-bailout-is-europes-dirty-little-secret-3026892.html)

Sigmund Freud once noted that: "Illusions commend themselves to us because they save us pain and allow us to enjoy pleasure instead. We must therefore accept it without complaint when they sometimes collide with a bit of reality against which they are dashed to pieces."

Europe and the EU are soon to go through one of those 'collisions with reality'. The reality of the latest deal in Greece is that it drives the Greeks deeper into the mire and as the economy there contracts yet more, the wheels of this deal will fall off.

Before we go into what the deal means for us, let's examine the latest illusion. Last year the illusion was that 'austerity creates growth'. The 6pc contraction in the Greek economy in the final quarter put paid to that canard. As does our rising insolvency and mortgage arrears data here.

The latest illusion that the EU has now come up with is that '120' is the new '60'. A debt/GDP ratio of 120pc is now regarded as sustainable. A few weeks ago during agreement of the fiscal compact, a debt ratio of 60pc was regarded as the sustainable target. Now we know -- well, for Greece at least -- 120pc is the new 60pc.

One has to wonder is the new target set at 120pc of GDP because that's where Italy and Belgium are right now and to suggest that this was anything other that a good outcome for Greece might shine the light on these other outliers?

Whatever the reason, what is interesting for Ireland is that private bondholders took a 53pc haircut on their holdings. They have been burnt. It is estimated that the ECB owns up to €55bn of these Greek bonds, which it bought at a discount. Obviously because it didn't buy these bonds at face value, the loss the ECB will take will be less than 50pc but it is interesting in itself.

For Ireland, this means that we will get a deal on bank debt most definitely. It might take time because the last thing the ECB wants is a queue of 'me too' demands from Ireland and Portugal. But it is clear that our hand has been strengthened, if we decide to play it.

But just in case you think this is a victory for the citizen, let's examine in a bit more detail how it works. There will be no default. Greece will be given a €130bn loan. With that loan it will pay out €100bn to bondholders, who will have seen their bonds fall 53pc in value. After the penal interest Greece has paid on these bonds already, we still see an insolvent country paying bondholders 50pc of face value when they should be getting nothing.

So Greece gets €100bn written off, but borrows €130bn in order to achieve this, so it is still borrowing more making its overall debt not better but worse in absolute terms.

Now it needs to grow to bring these figures down and that is going to be impossible. So we are going to be back to square one in a few years except for one crucial thing.

After all this is done, private creditors to Greece will have been paid by European public money stumped up by the taxpayers of other European countries. The banks have been bailed out again. Without help they would have got nothing. They now get 50pc of their worthless holdings and the subsidy comes from the taxpayer.

The illusion of a great deal was exemplified by Jean-Claude Juncker, the chair of the meetings of eurozone finance ministers, who said that the Greek debt deal "will preserve the financial stability of Greece".

It will do no such thing. And Mr Juncker knows it.

According to Bill Bonner at the wonderful www.dailyreckoning.com: "A 10-page 'strictly confidential' report on the country's debt projections prepared for eurozone leaders warns that the principles of the new deal will (a) cause debt levels to rise by further weakening the Greek economy and (b) scare off future bond market funding."

The report also reveals that Greek debt could still be at 160pc of GDP by 2020 and that it could require another €245bn in bailout funding.

It concluded: "Prolonged financial support on appropriate terms by the official sector may be necessary."

So let's go back to Freud. Why would Europe's financial and political elites insist the deal is sound when they know it's not? The reason goes back to the dirty little secret. The 'bailout' of Greece is really a bailout of eurozone banks.

But they can't say that, so they maintain the illusion of success because, as Freud said, "it saves us pain" and obviously the collision has been postponed for a little while more.

As this column has said many times before, you don't make a balance sheet with too much debt better by adding more debt; you fix it with less debt.

Greece is not making progress on this basis. All it is doing is incurring new debt to retire old debt .

Contrast this with Iceland. In the same week as the eyes of the EU were focused on Greece, Iceland -- a country which in 2008 suffered a monumental crash -- is now recovering strongly.

It has done exactly what economic mainstream thinking would advise. It dropped its currency by over 40pc to make itself more competitive and mainly to choke off unnecessary imports. It defaulted on its bank debt by simply telling the creditors that there was no cash and they could take equity in the banks if they wanted.

So it devalued and defaulted and, far from the markets punishing Iceland, the markets rewarded them. Iceland is now borrowing again, the economy is growing, inflation has fallen and there has been large-scale mortgage debt relief. Crucially, unemployment is now at 6pc and falling. And it is running at 6pc of GDP budget deficit, borrowing from abroad and at home to do so. Who says people won't lend? Of course they will, because the debt default means that the balance sheet is fixed.

The Icelanders took control of the situation and did things their way. They were rewarded. They didn't try to be 'best in class', but laid out things as they were to the creditors. The markets moved on. They would do the same here.

Make no mistake, the way mortgage arrears are rising here and the way companies are going to the wall due to their debt burden, huge debt deals will have to be done here.

It's just a matter of when, not if. Greece shows us how not to do things. When it comes to debt, Iceland gives us a roadmap.

www.davidmcwilliams.ie

[Kralizec]

Kicking them out of EMU, letting them go bankrupt, and calling in the IMF is EXACTLY what should have happened, by now Greece would have returned to growth, not least because a massively devalued Drachma would have put labour costs through the floor and German tourists would be able to spend on holiday, even with inflation. As it is, in the Euro, the inflation in Greece makes it a less attractive place to go, which hamstrings its best short term hope for economic recovery.

You make it sound like this is a painless transition.



Here's the real dirty secret: Greece only has a defecit because of its debts - managable cuts would be possible if Greece defaulted, but that would upset the European banks, so the Greeks have to wait until everyone else has extracted their money from the country before they can leave EMU and devalue.

Since when? AFAIK Greece is still running a primary deficit - that is; even when you'd subtract the interest payments, they're still in the red. Or at least, they were until shortly ago:
http://sdw.ecb.europa.eu/quickview.do?SERIES_KEY=121.GST.Q.GR.N.D1300.PDF.D0000.CU.E

[gaelic cowboy]

Since when? AFAIK Greece is still running a primary deficit - that is; even when you'd subtract the interest payments, they're still in the red. Or at least, they were until shortly ago:
http://sdw.ecb.europa.eu/quickview.do?SERIES_KEY=121.GST.Q.GR.N.D1300.PDF.D0000.CU.E

And the solution is to lend more money to increase the debt to gdp ratio???????

Only a fool would think this is anything other that ensuring banks get repaid, if the objective was to reform Greece then simply kick them out of the Euro devalue there debt and have them enter a strict IMF only programme. The present plan is merely about lending money to a drunk man so the local pub doesnt go bust this side of christmass.

[Fragony]

The present plan is merely about lending money to a drunk man so the local pub doesnt go bust this side of christmass.

Not even that, they are just paying his bill to the bartender. I feel sorry for the Greeks. First EU-colonie yay.

[drone]

The present plan is merely about lending money to a drunk man so the local pub doesnt go bust this side of christmass.
:laugh4:

About as good an analogy I've heard yet.