Greek debt: Merkel dismisses Tsipras's last-ditch compromise plan
Source: The Guardian
In an address to the Bundestag, the German chancellor, Angela Merkel, reiterated her stance that there was no point in having talks with the government of Alexis Tsipras before a referendum in Greece on an EU bailout plan.
The door to talks with the Greek government has always been, and remains, open, she said, but added that talks could not take place before Sundays poll.
...
Shortly before it slid into default, Greece wrote to its creditors to elaborate on an earlier request for a two-year 29bn loan from the eurozones 500bn crisis fund. The Tsipras government indicated it was ready to accept a large part of its creditors demands, but asked for concessions on VAT reform and pensions.
...
Our amendments are concrete and they fully respect the the robustness and the credibility of the design of the overall programme, said the letter, addressed to the heads of the European commission, the International Monetary Fund and the European Central Bank.
Read more: http://www.theguardian.com/business/2015/jul/01/greek-debt-merkel-dismisses-tsipras-compromise-plan-referendum-bailout
Greece's government boxed themselves in. The other Eurozone countries don't see the point in cutting a deal with the referendum coming up this weekend.
Even after the referendum, hard to see the end-game. If the no vote prevails, it's literally back to the drawing board. And what then? The next deal also gets put to a referendum? How different would that deal have to be from the rejected one for Greece's government to accept it, from a legal point of view?
If the yes vote prevails, the questions become (1) can SYRIZA implement an agreement it has rejected; and (2) will SYRIZA even stay in power? It could easily split apart with some factions refusing to implement an austerity agreement. It's already catching hell from other leftwing parties for effectively endorsing an austerity package that is virtually identical to the one it vehemently rejected and put to a referendum.
Merkel et al seem quite a bit more confident at this stage.
PoliticAverse
(26,366 posts)If Greece were running a budgetary surplus (minus debt repayment) this wouldn't
be the case.
Art_from_Ark
(27,247 posts)Merkel is in a good position to fleece Greece.
yeoman6987
(14,449 posts)Money in the first place. There has to be a way to run Greece without taking money from Germany and others. I imagine Merkle is tiring of Greece coming back for loans year after year.
JDPriestly
(57,936 posts)We are kind of in a similar position in terms of ISIS invading Iraq.
The Bush government should never have gone into Iraq. Now unfortunately, and very unfairly, the Obama government has to pick up the pieces and deal with the failure of the Iraq and the Syria (which was shaken and damaged by the Iraq war also) debacle.
The Syriza goverment is trying to clean up a mess it did not cause.
It's actually Goldman Sachs and hedge fund managers and people like Carlos Sim of Mexico, extremely rich people, who made the original and subsequent loans that got handed like hot potatoes around until they ended up with Northern European countries and the IMF as I understand it.
Don't blame the Greek people. They just voted for the candidates backed by the big corporations. We do the same here and could end up in the situation that Greece is in. We have a big debt and a huge balance of payments deficit. We should not be throwing stones at the Greek people. We are just as stupid as they are. We are not paying our bills. Our corporations refuse to pay taxes. They prefer to buy off our political system. That is precisely what put Greece in the position it is in. Do you seriously think that the little pensioner who taught school all her life benefited much from the low tax rates on the rich, the mismanagement of the many ports in Greece, the dirty dealings in various industries? Not really. But now that retired school teacher is being asked to starve herself so that Goldman-Sachs can enjoy its profits from derivative deals made with a former Greek government.
Beware of men in shiny suits with big bank accounts who promise to rescue you from your misery. They probably don't have your best interests in mind.
We should not feel superior to the Greek people. We aren't. We are falling for the same swindles and have fallen for the same swindles that Greece fell for.
ananda
(28,876 posts)One-percent globalization interests are behind at least 99% of the world's ills,
including our own.
Euphoria
(448 posts)and correct summation of what's going on with Greece and the troika.
GliderGuider
(21,088 posts)Well articulated.
still_one
(92,397 posts)Igel
(35,356 posts)So add another day to the nail-biting. (If you're into nail-biting.)
Some of the sites with links to the Greek poll results system are still up and running. I'm glad to see that they've reset the system to yes/no and are starting to run test data already for the referendum.
(Of course, if the site's up and running, and there's test data, there'll be CT folk out saying that the system's being programmed for the correct results even as we discuss the referendum.)
geek tragedy
(68,868 posts)saving Greece's economy from a complete implosion is to either cancel the referendum or publicly urge everyone to vote yes on it.
The way things are currently set up, the referendum means either a Grexit (no) or SYRIZA resigns and new elections (yes).
The creditors are not going to place any credence in a guy who called a referendum because he can't trust himself.
candelista
(1,986 posts)http://www.archives.gov/exhibits/charters/declaration_transcript.html
geek tragedy
(68,868 posts)there isn't a current offer on the table, the offer that Mr. Bean put to the referendum expired on Tuesday.
Tsipras has shown himself to be a shady, untrustworthy operator. Can't imagine why the Troika aren't lining up to throw him a lifeline.
Recursion
(56,582 posts)The default just happened; once the banks re-open it won't be euros they give out, even if that's what they are in name, capital controls mean they won't actually be "euros".
geek tragedy
(68,868 posts)according to ratings agencies and CDS holders (litigation ahead there).
The banks won't reopen until a decision is made one way or the other.
The referendum was supposed to scare the Troika by waving the contagion bogeyman in front of them.
It failed.
candelista
(1,986 posts)I don't know how familiar voters will be with the referenced proposals.
geek tragedy
(68,868 posts)So, this is like voting on whether we want Abraham Lincoln as President.
candelista
(1,986 posts)JDPriestly
(57,936 posts)Military force?
Greece is a parliamentary system. They think differently than we do. This vote is sort of like taking the temperature of the nation. The Greek government that decided to hold the vote is, and I think this is a morally commendable, democratic thing to do, putting itself up for acceptance or rejection.
After the vote, we will know whether the Greek people prefer to accept the North Europeans' proposal for still more austerity and a long, drawn-out, every worsening economic decline or take a chance on leaving the Euro and sinking or swimming on its own.
I think the referendum is a great way. It means that the Greek people buy into the solution. It doesn't mean that either alternative is good. They are both bad. But at least the voters have made a choice as to which poison they want to drink.
We could find ourselves in the shoes of the Greek people one day. We should not be too hasty to feel superior to them or to judge them harshly. Our banks are a bunch of sick puppies. We don't realize how bad it reallly is -- not yet.
geek tragedy
(68,868 posts)and institutions.
Perhaps you are not understanding things.
The Eurozone countries made a proposal that expired on Tuesday, June 30. After that point, it became literally impossible to accept that offer. That offer expired, it doesn't exist.
Mr. Bean scheduled a referendum on the offer to fall after the offer expired.
If someone says "I need to know whether you want the Tuesday night concert tickets by 6:00 PM on Tuesday" it is Kafkaesque to reply "I will ask my folks to vote on your proposal next Sunday."
The referendum ended negotiations. There was no ultimatum until Mr. Bean announced the referendum.
So, now the Greek people do have an ultimatum--a gun to their head. Grexit or Austerity.
But, Mr. Bean is telling them that the choice is between Austerity and a wonderful deal his crew will land if they just vote no.
Which is patently dishonest.
Greece's banks will remain closed until they either (1) cave in and accept a deal from the Troika or (2) leave the European Union and start printing drachmas.
Greece doesn't have forever to make that decision.
blackspade
(10,056 posts)In an address to the Bundestag, the German chancellor, Angela Merkel, reiterated her stance that there was no point in having talks with the government of Alexis Tsipras before a referendum in Greece on an EU bailout plan.
The door to talks with the Greek government has always been, and remains, open, she said, but added that talks could not take place before Sundays poll.
So there is no point continuing negotiations but the talks are still open.....right.
geek tragedy
(68,868 posts)There is no point negotiating when there's a referendum scheduled that deals with the issue.
If they cut a deal, and then the population votes no two days later, what's the point?
Any condition of a deal would have to be (a) cancelling the referendum outright; or (b) Mr. Bean and SYRIZA publicly urging their supporters to vote 'yes' in the referendum.
It's hard to overstate what a colossally stupid, chickenshit stunt calling that referendum was while there were negotiations going on.
Once that referendum was called, all negotiations ended. That was the entire point of the referendum. You don't schedule a referendum for a deal that's still being negotiated.
blackspade
(10,056 posts)Neo-liberal economics has failed yet again.
geek tragedy
(68,868 posts)and they refuse to negotiate in good faith.
Do you think the EU, ECB and IMF should just hand over all their money to Mr. Bean and the gang who couldn't shoot straight and tell them to go ahead and save the world?
The problem is that a no doesn't mean no, and yes doesn't mean yes when dealing with SYRIZA.
Mr. Bean makes offer in the morning, goes out in public and asks Greek voters to reject the offer he just made.
blackspade
(10,056 posts)and what is this bullshit statement?
Her finance minister, Wolfgang Schäuble, was fiercely critical of Tsipras, saying: Greece is in a difficult situation, but purely because of the behaviour of the Greek government Seeking the blame outside Greece might be helpful in Greece, but it has nothing to do with reality.
This is a patent lie.
geek tragedy
(68,868 posts)They are advocating some pretty heinous policies, but one knows exactly where they stand.
Is Mr. Bean open to a deal based on the offer that expired on Tuesday? He's making proposals based on it while asking voters to reject that offer as a basis for negotiations.
That's the very definition of duplicitous.
JDPriestly
(57,936 posts)Americans have trouble understanding that in a parliamentary system, elections whether simply in the parliament itself to disband a government and ask the people to vote again on a new government, or this sort of referendum are the elections system. Sure, there are regular elections, but parliaments can be dissolved. This referendum may result, in my opinion, on a re-election of one party or group or another depending on the result.
It is a vote of confidence or no confidence on the direction the current government leadership is taking. I think Syriza might remain in power after the vote, but it might have a different configuration of parties or leadership.
But, the fact remains that there is no way out for Greece other than some form of default. The austerity programs have not helped Greece relieve itself of debt. It is very likely that Greece will turn to countries like Brazil, Russia, China, etc. for help.
This is not good for Europe. Germany was forgiven debt and allowed to extend its debt repayment and assisted with all kinds of aid after WWII even though it was responsible for allowing Hitler to invade country after country and kill millions of people.
And now, Greece, over money, is being allowed to suffer like this. There is a moral disgust in my throat when I think of it. The average Greek person did not understand the financial shenanigans that were going on under the previous governments. As recently as 1973-74, the Greek government was a military dictatorship. My heart goes out to the Greek people. This is a sad state of affairs.
And Goldman-Sachs and a lot of wealthy "lender" (vultures as Greg Palast points out) are primarily to blame for helping a Greek government cook its books.
Greece is still and I will repeat this again and again in a strategically important location. It may be that our planes can pass over Greece without touching its bases, but Greece is reached by sea and land and will be vulnerable to all kinds of problems and a feeding place of anger and desperate poverty that will bring no good to Northern Europe. The Northern Europeans are foolish in this case. Very foolish.
Democat
(11,617 posts)No matter what, Germany is the bad guy and Greece is the good guy to some people.
blackspade
(10,056 posts)the "stick it to Greece" crowd?
It is not Germany that is the bad guy here.
It is the Troika capitalists that want to impoverish the citizens of Greece.
They are the bad guys. Merkal is just their mouth piece.
Bosonic
(3,746 posts)https://twitter.com/AFP/status/616255001544015872
geek tragedy
(68,868 posts)from power.
Also, he makes an offer and then turns around and pretty much tells the country he opposes his own offer and asks them to reject it.
Complete weasel.
Recursion
(56,582 posts)When the banks reopen they'll either have to be in an explicitly non-euro currency or in alleged "euros" that can't leave the country.
As far as I can see this referendum is at most a call for a snap election to facilitate a government that will re-enter the eurozone.
geek tragedy
(68,868 posts)there was even a default (seems academic to us, those holding CDS's would beg to differ)
Their car is out of gas. The question is whether they put more gasoline in the tank, or try to rebuild the engine so it can run on solar power.
Banks won't open until after the referendum and after there's been a decision one way or the other.
Referendum was an idiotic, chickenshit negotiating stunt that backfired spectacularly.
Recursion
(56,582 posts)But, yeah, I grant that the question of the default having happened remains open.
geek tragedy
(68,868 posts)Recursion
(56,582 posts)If your currency stops being convertible, that's what I would call "leaving"
geek tragedy
(68,868 posts)An actual Grexit isn't the type of thing that happens with no one noticing it.
JDPriestly
(57,936 posts)The referendum gives the power to the Greek people to decide whether to exit the Euro or stay in and accept basically a government program imposed by Northern Europe.
I think that Syriza is showing a lot of courage with this vote. It is the right thing to do. The Greek people, not a small group of representatives, have to commit to one direction or the other.
This vote is a commitment. If they vote to stay in the Euro, then the Greek people will have a difficult time dealing with austerity.
If they vote to leave the Euro, the Greek people will have a difficult time dealing with a new currency organization and another source of austerity.]
Either way, the Greek people lose and a lot of very rich people like Carlos Sim and Goldman-Sachs win because they have most likely sold their debt and their interest in the derivatives they sold based on the Greek debt.
Either way, those rich people who should have been paying their taxes all along have probably already rescued their money from the financial devastation that is coming (regardless of how the referendum turns out) will reap the bonanza and will buy up everything they can.
If the vote is no as the Prime Minister has requested, then I assume that the Prime Minister knows he will have to pull rabbits out of the hat to continue to govern. If the vote is "yes," then Syriza which did not cause the problem in the first place is off the hook.
I think people, if they don't understand the issues and just vote without much information, are more likely to vote yes than no. But I might be wrong about that.
When will it be our turn? is my question.
Our trade agreements plus our overvalued dollar are messing up our economy at its very foundation, making us dependent on foreign money. That's what our trade deficit means. We rely on foreign investment to keep our industrial base and country going. We are headed toward the kind of fiasco that Greece is in.
No to the TPP. It's our EURO.
geek tragedy
(68,868 posts)He's telling people, flat out, that a 'no' vote is a vote to keep the Euro AND get rid of austerity.
http://www.theguardian.com/business/live/2015/jul/01/greek-debt-crisis-creditors-consider-next-moves-after-imf-default-live#block-5593fb49e4b08f71d0eba4ee
Here are his tweets today:
.
.
.
Do you think Mr. Bean is being honest with the Greek people? He's saying the 180 degree opposite of what you're saying.
If he's lying to the Greek people, do his negotiating counterparties have any reason to trust him to follow through on commitments he makes as part of a deal?
cstanleytech
(26,319 posts)What was on the table to be cut?
JDPriestly
(57,936 posts)and a rise in taxes on certain sources of tourism revenue.
The pensions have already been cut to rock bottom, and tourism revenue is a major and useful source for taxation because it comes from outside Greece and is a real source of income. Increasing costs to tourists would discourage tourism and reduce that very good source of government income in Greece. The Greek people gain from the tourism in terms of employment, but they don't directly benefit from low taxes for tourists.
I think the real goal is to make sure there is a McDonalds in the Parthenon, maybe Goldman Sachs wants a share of the Oracle of Delphi. They sure need one. They bet Greece and derivatived Greece into this mess. Obviously, their current Oracle is pretty satanic.
Gregorian
(23,867 posts)It's almost like the human race forgot they were human.
I'm really pissed off at this species now.
geek tragedy
(68,868 posts)Greece is the outlier, not Germany.
Gregorian
(23,867 posts)After all, it really is about more than just money.
Max Keiser says Greece is toast, and France and Italy could be next.
turbinetree
(24,720 posts)geek tragedy
(68,868 posts)turbinetree
(24,720 posts)fraud is fraud
geek tragedy
(68,868 posts)What doesn't make sense is arguing that Germany should be penalized/is the villain because Goldman and Greece collaborated on fraud.
JDPriestly
(57,936 posts)An international body needs to fine Goldman for doing this deal. It's Goldman that should pay. And I say that knowing that ultimately American pension funds and investments of people who had no part in this fraud will pay. That hurts my heart, but the fair thing is to fine Goldman and give the proceeds to Greece and the creditors that were tricked. Goldman can defend itself and get a fair deal. It has defended lots of fraud and dirty tricks in the past. It will get a fair shake. Greece and Germany are getting the bad end of this, I agree. But Germany should stand up for Greece and not just pour oil on the fire.
geek tragedy
(68,868 posts)Those running the deal belong in jail.
hill2016
(1,772 posts)but what exactly did Goldman do that was illegal?
Currency and interest rate swaps are legitimate transactions between two willing counterparties. In this case, an entity wants to hedge its exposure to interest rate risk in return for paying a fixed rate. If interest rates went up it would earn a lot. In this case it bet wrongly hence Goldman made the profits.
Another example is how airlines hedge their the price of oil. If oil goes up a lot they make a lot of money and the counterparty loses. Is either party doing anything illegal?
JDPriestly
(57,936 posts)Goldman Sachss instant gain on the transaction illustrates the dangers to clients who engage in complex, tailored trades that lack comparable market prices and whose fees arent disclosed. Harvard University, Alabamas Jefferson County and the German city of Pforzheim all have found themselves on the losing end of the one-of-a-kind private deals typically pitched to them by securities firms as means to improve their finances.
Goldman Sachs DNA
Like the municipalities, Greece is just another example of a poorly governed client that got taken apart, Satyajit Das, a risk consultant and author of Extreme Money: Masters of the Universe and the Cult of Risk, said in a phone interview. These trades are structured not to be unwound, and Goldman is ruthless about ensuring that its interests arent compromised -- its part of the DNA of that organization.
A gain of 600 million euros represents about 12 percent of the $6.35 billion in revenue Goldman Sachs reported for trading and principal investments in 2001, a business segment that includes the banks fixed-income, currencies and commodities division, which arranged the trade and posted record sales that year. The unit, then run by Lloyd C. Blankfein, 57, now the New York-based banks chairman and chief executive officer, also went on to post record quarterly revenue the following year.
Extremely Profitable
The Goldman Sachs transaction swapped debt issued by Greece in dollars and yen for euros using an historical exchange rate, a mechanism that implied a reduction in debt, Sardelis said. It also used an off-market interest-rate swap to repay the loan. Those swaps allow counterparties to exchange two forms of interest payment, such as fixed or floating rates, referenced to a notional amount of debt.
More, much more at
http://www.bloomberg.com/news/articles/2012-03-06/goldman-secret-greece-loan-shows-two-sinners-as-client-unravels
Don't blame Greece. You wouldn't blame the other vicitms of Goldman Sachs in these kinds of deals, would you? Harvard University?
Come on now. I would expect Harvard University to have a very sophisticated, knowledgeable investment advisory board. Yet it was tricked too.
We need to clean up our banking and investment regulations.
And I think Bernie is the only one with the courage to do that.
That's one of the reasons I so strongly support Bernie.
geek tragedy
(68,868 posts)Greece used the funny money it was channeling through Goldman to artificially boost wages, government spending, real estate and stock market values.
Greece's rightwing government knew exactly what it was doing. They were corrupt oligarchs who screwed their country blind.
JDPriestly
(57,936 posts)Bush left the country with a huge deficit for wars he did not fund.
That was his gift to Halliburton and the military industrial complex.
Again, the only person I trust to set this straight, talk straight to the American people about our choices before we end up like Greece (assuming we aren't already in Greece's position) and discover the fraud perpetrated on us by our own banks and government, is BERNIE SANDERS. The only one. He is the only one who is not bought out.
geek tragedy
(68,868 posts)Our national debt is perfectly manageable. It should be even higher, as we should be borrowing aggressively to finance infrastructure projects.
JDPriestly
(57,936 posts)dollar -- is our problem.
That is a real debt. A lot of people think it is nothing. But what it represents is the fact that we are buying products for less than they would really be worth if our currency were properly valued. And that means that we are headed for a reckoning and an inflation that won't be pleasant. And that will be complicated by the fact that we have neither the industrial infrastructure nor the skills to make the things we need.
My father-in-law came from Europe having learned a valuable skill over there. He worked for his life making highly valued products in an American factory. The company that owned the factory now makes its products in China and elsewhere.
When our currency is devalued and prices start rising in our stores, we will borrow more to buy more. We have no other choice because we have irresponsibly and regrettably traded away our economic infrastructure when it comes to manufacturing.
We could easily be worse off than Greece. Greek people have always known how to live on very little, how to consumer very little. Americans????????? Big problem. We buy trash and throw it away as fast as we can.
The proverbial frogs do not feel the rising temperature of the water in which they are slowly being cooked. Neither do we.
The only person I trust to examine, investigate and do something to right our economy is Bernie Sanders.
People say he is an extremist, but I think that the evidence is that he is quite middle of the road. And what is that evidence? He has been elected and re-elected and trusted by the sturdy, winter-proofed, romantic but feet-on-the-ground voters of Vermont over and over. Hard to argue against Yankee common sense. So I trust Bernie and only Bernie to assess our economic situation and know what needs to be done.
I know he calls himself a democratic socialist, but I think that in fact he is actually a democratic realist. My assessment is based on his record. He is hard-headed but tends to judge correctly.
hill2016
(1,772 posts)Goldman defrauded Greece of $600m, how does that make it responsible for the rest of the $300b that Greece owes?
JDPriestly
(57,936 posts)On the day the 2001 deal was struck, the government owed the bank about 600 million euros ($793 million) more than the 2.8 billion euros it borrowed, said Spyros Papanicolaou, who took over the countrys debt-management agency in 2005. By then, the price of the transaction, a derivative that disguised the loan and that Goldman Sachs persuaded Greece not to test with competitors, had almost doubled to 5.1 billion euros, he said.
http://www.bloomberg.com/news/articles/2012-03-06/goldman-secret-greece-loan-shows-two-sinners-as-client-unravels
Compound interest would certainly be one factor. Another factor is that the austerity that was imposed on Greece by the Troika and suggested also by the IMF management although warned against by the IMF staff caused the huge debt to swell.
Further, as the country fell deeper into debt, wages fell, pensions fell, etc., and young people who could produce revenue began to leave. The austerity deepened Greece's economic problems.
Money represent the exchange of products and services. It has no value in and of itself. Austerity looks like a good idea if you think about the numbers and view money as something with a value all of its own. But when you think of money as actually representing a flow, the exchange of value, money as an incentive and reward for economic activity, then you see that when an individual or a nation takes on a lot of debt for whatever reason (and Greece took on some of its debt to cover up its economic weakness so that it could join the EURO - - that was under a conservative government) and has to pay the interest on that debt rather than use earnings gained as an incentive for more economic activity, then the servicing of the debt and the austere policies adopted to insure payment of the debt cause the economy to just dwindle down.
Money is like blood. If it flows through the economy in a balanced way, they you have a good chance of having a healthy economy. But when the blood flows out of the body as when you have a serious injury, then the body becomes weaker, less active and may even die simply from the loss of blood.
Greece may be at that point now.
The debt is in my opinion may also be in part due to the very geography and geology and difficulty of the terrain and limitations on the natural resources in Greece.
There was a lot of cheating on taxes and an unwillingness on the part of wealthy Greeks to pay Greek taxes too I am informed. I don't know about this, but unless someone shows me evidence to the contrary and based on my limited but probably greater experience than most with Greek people and even with Greek wealthy people, I am inclined to believe that this is true. Think how reluctant our wealthy are to pay fair taxes. I can only imagine that in the shipping industry, traditionally one of Greece's great industries, it is now easy to hide profits and escape paying fair taxes in Greece.
Good question. I am not an expert. But those are facts that I am pretty certain of. There is a Real News Network video here on DU that explains well the history of aspects of the Greek crisis.
On edit: http://www.democraticunderground.com/1017275705
That's the video. Bill Black is one of the interviewees.
Hard to find facts on just how the situation could have been allowed to get so bad. Do you remember one or two months ago, the big moment when Greece managed to meet an IMF deadline. Have you read, John Perkins' book Confessions of an Economic Hitman?
If you notice, no one wants to answer or even try to answer your question. It's quite embarrassing to Northern Europe, the IMF and the US. That's the fact.
hill2016
(1,772 posts)Let's say you hire a lawyer to set up an offshore trust for you.
You use it to hide assets from your creditors or your spouse who wants to divorce you.
Is the lawyer at fault here or you?
That's basically what Greece did. It hired Goldman to hide its debts so it could squeeze into the Euro. Goldman may have made a lot of money but it didn't do anything illegal.
If Greece already had debts and borrowed more and more until it was sustainable, how is that Goldman's fault?
I do agree that the rich Greeks should have to pay much more in taxes.
JDPriestly
(57,936 posts)Now, the Greek people are being asked to pay for the fraud and cheating of a former government.
If we agree to the TPP, we could find ourselves in a similar situation. We don't know what is in the agreement. We are being asked to trust our government. The agreement could land us in enormous, unimaginable debt or deprive us of the capacity to govern ourselves with regard to things like banking, barring dangerous financial instruments, etc. The TPP courts could be a big problem in this respect.
We are being prepared for the slaughter just like the Greeks. We already have a huge trade deficit. We are told that it is due to the fact that our currency is overvalued. What happens when our currency is valued accurately? Imports become more expensive and we find our debt rising to cover the cost of products we need because our factories were shipped overseas and we no longer produce basic products like sweatshirts (or we produce too few of them).
So don't think for one minute that we are better than the Greek people. They were lead to the slaughter by unscrupulous, possibly bought-off, but in all events, foolish politicians, possibly just like some of the corporate bought-off politicians we suffer under.
Greece owes a lot of money. Much of it is interest. That interest can be written off. Maybe the creditors should be asked to accept repayment of the original principal of 600 million that the Greeks borrowed. The creditors are the German government and behind and prior to them, as I understand it, the French government, hedge funds and extremely wealthy individuals.
The situation in Greece is a test of our humanity.
Did you watch this video?
http://www.democraticunderground.com/1017275705
I would say that Greece is a victim of the 2008 and 1999
Germany for one is failing it.
Greece could raise taxes and lower pensions, but those measures would wreck their economy still further and not enable them to pay their bills.
They may be rescued by a group of countries, and those countries may include us, Brazil, China, Russia, and the nations that are emerging and perhaps more sympathetic to Greece than Europe.
That's my guess. If you listen to that Real News interview, you learn that the people that want to be paid off are the usual scoundrels.
Nye Bevan
(25,406 posts)He is asking for a "no" vote but expects and hopes for a "yes" vote. This way he can (effectively) say "OK, sure, whatever, we'll do it your way, but I didn't want to do it like this and if it doesn't work out it's not on me, it's on you".
geek tragedy
(68,868 posts)they'll have to form a coalition/national unity government with a party that can be trusted to implement agreements with its creditors.
In any event, SYRIZA's factions would head for the exits rather than implement an austerity package.
DCBob
(24,689 posts)I suspect he is now scrambling to figure out a way to cancel the referendum. Maybe too late.
geek tragedy
(68,868 posts)Euro powers that be are very close to concluding that SYRIZA aren't a partner for peace
DCBob
(24,689 posts)He has lost all credibility by capitulating to EU demands while at the same time telling his people to vote no on referendum. He's playing games and he's about to lose.
geek tragedy
(68,868 posts)down the middle, in addition to making him look like a combination of Benjamin Netanyahu and the House Republican clown car in their debt ceiling prime.
DCBob
(24,689 posts)BRUSSELS (Reuters) - Euro zone finance ministers piled pressure on Greek voters and their government on Wednesday by warning that negotiations on a new bailout would depend on the result of Sunday's referendum on previous EU credit terms.
"We will come back to your request for financial stability support from the ESM (European Stability Mechanism) only after and on the basis of the outcome of the referendum," Jeroen Dijsselbloem, who chairs the Eurogroup, wrote to leftist Greek Prime Minister Alexis Tsipras, who is calling for a No vote.
The implication is that loan terms -- commitments from Athens to tighten its budget and revamp its economy -- may be tougher in the event of a No to the creditors than a Yes. EU leaders have said this week that a No could jeopardize Greece's use of the euro, while a Yes would show support for the EU.
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This sounds like Tsipiras and his party will either have to capitulate entirely or simply resign.