greece The Greek Economy Thread

[Dutch Eagle]

@Bananas

 

Like in every country there are morrons and rocket scientists and the rest is in between. Greece is no exception. Greeks in the diaspora are no exception. But this referendum is way out of the league of the majority. Mine too. I can not figure out what the complications are of you say A or B. What are the effects in about 10 or 20 years? Audit offices of countries can. Plain civilians can not. Therefore the government has to decide this specific item. 

 

@js1000

 

Lower taxes and EU would be nice. But (as RS stated so well) we have to move forward. For our kids and future generations.

[Brklyngrk]

I have lost all respect for Tsipras and his government (not that I had that much before hand). If you wanted the people to decide, you should have let them decide BEFORE the June 30th deadline. You know, right before the tourist season (Greece's #1 revenue producer!!!!) This shows his inexperience of negotiating at the international level.  All he did was antagonize the EU and everyone else who was working on the negotiations.  I do not think he is wrong on some of his points however the harsh reality is that if Greece votes NO, Greece is out of the Euro.  People will suffer a lot worse than they will under the current program.  Greece receives/received a lot of EU subsidies which will now come to an end.  He went all in holding a pair of deuces.

[js1000]

 

 

I live in a country that I will work for 40 years and i will not receive a pension.....But the country and its economy is going very well...

The Chinese economy is also doing very well, its one of the strongest, that's been achieved on the back of sweat shops, appalling wages and zero pensions, I'm not sure how happy Chinese workers are that their country has such a strong economy. 

I think its outrageous really 40 years work and no pension, they get away with it because people accept it. applaud it even. 

 

 

Lower taxes and EU would be nice. But (as RS stated so well) we have to move forward. For our kids and future generations.

With the amount of wastage in the EU you can forget lower taxes, they need funds to continue with their incompetent and corrupt ways.

What future have future generations got in Greece if they continue this path? the EU demands i hear people say are reasonable, well suppose Greece accepts them it will be further indebted and what happens 2-3 months down the line? Greece will need another tranche of cash from Europe which will come with further 'reasonable' demands and on and on it will keep going, that's no future. 

[jarvis1981]

I haven't posted on the Greek Economic forum because as a person living in Canada I don't think I can truly appreciate all that is going on in Greece and in Europe in general. I will say that I have heard on a radio station in Toronto from a well known financial guru that Greece has in fact been printing their own currency for some time. Maybe it was a backup plan but it does seem suggestive to me that Greece is moving out of the Euro.

 

I also think a vote is a good idea even if the average citizen in Greece doesn't completely know the full ramifications. My "gut feeling" ( as I'm not an economy expert) is that Greece should leave the Euro currency. I don't see how adding more to the debt load each year with only "nudge nudge wink wink" promises of future investment and growth will get the country out of a bankrupt situation. Sometimes it's better to take a deep drop and hit rock bottom so you can begin the painful climb back up. At least you'll have the sense of accomplishment along the way.

 

Greece is still a beautiful country no matter what the outcome and they will survive no matter how long it takes. I feel for my relatives there and the people in Greece in general.

[Bananas]

@Bananas

Like in every country there are morrons and rocket scientists and the rest is in between. Greece is no exception. Greeks in the diaspora are no exception. But this referendum is way out of the league of the majority. Mine too. I can not figure out what the complications are of you say A or B. What are the effects in about 10 or 20 years? Audit offices of countries can. Plain civilians can not. Therefore the government has to decide this specific item.

@js1000

Lower taxes and EU would be nice. But (as RS stated so well) we have to move forward. For our kids and future generations.

No one knows for certain what the ramifications will be of choosing option A over option B. Economists can't predict more than 12 months ahead, if that, and if you get 10 economists in a room, you'll probably get 11 opinions.

However, what I do know for certain is the following :-

- having control of your own currency and having the ability to set your own interest rates can only be a good thing.

- most economists outside the EU think Greece is better off in the long run because of this.

- most economists outside the EU think the EU is terribly inflexible, bordering on incompetent.

- most economists outside the EU find the idea of Greece paying the debts farcicle.

- if Greece stops using the Euro the next 5 years will be very bad.

- if Greece has a a devalued currency, our exports will grow and imports decrease.

- if Greece stops using the Euro the EU is s%$#! scared (and I mean terrified) that if they manage to stabilise their economy, others could follow one day. This is key and is why Germany doesn't want a Grexit.

- I hate trying to type on an ipad mini with its brain dead auto correction.

The key is having control of your currency. Without that, you have nothing.

Edited June 29, 2015 by Bananas

[Lazarus]

This is the ballot....
 

For those that don't read Greek, it reads:

"Should the proposed agreement be accepted, which was submitted by the European Commission, the European Central Bank, and the International Monetary Fund in the Eurogroup of 25.06.2015 and consists of two parts, which constitute their unified proposal?"

 

"The first document is entitled 'Reforms for the Completion of the Current Program and Beyond' and the second 'Preliminary Debt Sustainability Analysis'."

 

Beside the question are two boxes: "Not approved/No; Approved/Yes".

 

How many Greeks do you think have read the plans for 'Reforms for the Completion of the Current Program and Beyond' and 'Preliminary debt sustainability Analysis' ?

[athinaios]

My goodness, this is utterly ridiculous. Not only it's too technical for most people to understand, but it's not clear of what the voters are asked.

 

It shows amateurs--and that's the Greek government--playing with fire in my opinion. Wow. Rather irresponsible too to do it at this point. Also, since there are ongoing negotiations (in the last couple days, the US and Europe said there are other options available) and possible developments, plus other factors (ie. missing the payment to the IMF tomorrow and the implications of it), this is a terrible referendum. It'll backfire on the government, and because this move was without good planning, it's reckless... Already the law of unintended consequences is playing out.... tsk.

 

PM Chipras seems unwilling to do what he was elected (and campaigned on) to do, that is negotiate better terms or declare bankruptcy and leave the euro and the European union.

 

By the way, elections were the referendum 5 months ago. What's happening today, should have happened shortly after those elections (I'm not talking about the referendum), instead of squandering 5 months of "negotiations."

 

On the other hand, the "troika" may have asked for some reasonable measures (reforming Greek law, taxes, transparency, etc), but its stupid severe austerity policies have made things much worse. They share a big part of this mess today.

[Brklyngrk]

So they leave, Greece has no money. Remember, we are an import economy and no one will want our drachma.  How will Greece pay its pensioners? How will Greece pay for law enforcement? Basic needs such as medicine, food?  We are the ones needing funds.  We default, we still owe that money!!!! We may negotiate some sort of write off but even Argentina paid some % of its debt to its creditors.  I do not think the average Greek understands what is at stake.  The deal we are getting stinks (the Samaras administration was getting to the point of building credibility with the Troika and would have gotten way better terms) but the alternatives are far far worse!!!! 

[gyros]

So they leave, Greece has no money. Remember, we are an import economy and no one will want our drachma.  How will Greece pay its pensioners? How will Greece pay for law enforcement? Basic needs such as medicine, food?  We are the ones needing funds.  We default, we still owe that money!!!! We may negotiate some sort of write off but even Argentina paid some % of its debt to its creditors.  I do not think the average Greek understands what is at stake.  The deal we are getting stinks (the Samaras administration was getting to the point of building credibility with the Troika and would have gotten way better terms) but the alternatives are far far worse!!!! 

 

 

Exactly.  I posted an article by the NY Times a few days ago on how Argentina and Greece are not alike.  Argentina is rich in resources while our biggest exports are fish and cotton.  The EU is paying to keep the lights on.  People don't realize it.  All the farmer subsidies from the EU too.  All the new road construction (EU).  To think the drachma will not make it 100x worse is laughable. We are a little kid and the EU is our parent.  We need them.  We are not capable of doing anything of value because we are a worthless society and people.

Edited June 29, 2015 by gyros

[Original 21]

https://www.indiegogo.com/projects/greek-bailout-fund#/

Well this is one way of coming up with the money. The question is, who wants an island???

[gyros]

Gyros are you sure they got their facts correct?

Greece's number one export is oil at 16 billion per year.

Argentina's number one export is fish....Those are the facts....So the source is talking out of their fuken a##.

 

 

http://www.nytimes.com/2015/06/26/business/an-echo-of-argentina-in-greek-debt-crisis.html?_r=0

 

Oil is an export because they refine it but with drachma, you aren't buying oil to refine because nobody wants funny money.

Edited June 29, 2015 by gyros

[Brklyngrk]

The other point is that the drachma will fluctuate to the Euro.  For example, we owe 300 billion euro which today is the equivalent to 600 billion drachma (example).  In a month, the 300 billion euro will equal 1 trillion drachma as the drachma will devalue to the euro making our debts more not less...

[zenon]

Exactly.  I posted an article by the NY Times a few days ago on how Argentina and Greece are not alike.  Argentina is rich in resources while our biggest exports are fish and cotton.  The EU is paying to keep the lights on.  People don't realize it.  All the farmer subsidies from the EU too.  All the new road construction (EU).  To think the drachma will not make it 100x worse is laughable. We are a little kid and the EU is our parent.  We need them.  We are not capable of doing anything of value because we are a worthless society and people.

You have shown that the only worthless person in this debate is you with your continuous abuse and downright people like you disgust me. You are incapable of any kind of reasoned debate. All you do is constantly abuse hiding behind your keyboard you silly child.

Why don't you go and tell some of these "worthless" people what you think of them to their faces.

[Bananas]

Good article http://www.theguardian.com/business/2015/jun/29/joseph-stiglitz-how-i-would-vote-in-the-greek-referendum from Joseph Stiglitz.

 

Some snippets.

 

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Of course, the economics behind the programme that the ?troika? (the European Commission, the European Central Bank, and the International Monetary Fund) foisted on Greece five years ago has been abysmal, resulting in a 25% decline in the country?s GDP. I can think of no depression, ever, that has been so deliberate and had such catastrophic consequences: Greece?s rate of youth unemployment, for example, now exceeds 60%.

 

It is startling that the troika has refused to accept responsibility for any of this or admit how bad its forecasts and models have been. But what is even more surprising is that Europe?s leaders have not even learned. The troika is still demanding that Greece achieve a primary budget surplus (excluding interest payments) of 3.5% of GDP by 2018.

 

Economists around the world have condemned that target as punitive, because aiming for it will inevitably result in a deeper downturn. Indeed, even if Greece?s debt is restructured beyond anything imaginable, the country will remain in depression if voters there commit to the troika?s target in the snap referendum to be held this weekend.

 

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We should be clear: almost none of the huge amount of money loaned to Greece has actually gone there. It has gone to pay out private-sector creditors ? including German and French banks. Greece has gotten but a pittance, but it has paid a high price to preserve these countries? banking systems. The IMF and the other ?official? creditors do not need the money that is being demanded. Under a business-as-usual scenario, the money received would most likely just be lent out again to Greece.

 

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That concern for popular legitimacy is incompatible with the politics of the eurozone, which was never a very democratic project. Most of its members? governments did not seek their people?s approval to turn over their monetary sovereignty to the ECB. When Sweden?s did, Swedes said no. They understood that unemployment would rise if the country?s monetary policy were set by a central bank that focused single-mindedly on inflation (and also that there would be insufficient attention to financial stability). The economy would suffer, because the economic model underlying the eurozone was predicated on power relationships that disadvantaged workers.

 

It is hard to advise Greeks how to vote on 5 July. Neither alternative ? approval or rejection of the troika?s terms ? will be easy, and both carry huge risks. A yes vote would mean depression almost without end. Perhaps a depleted country ? one that has sold off all of its assets, and whose bright young people have emigrated ? might finally get debt forgiveness; perhaps, having shrivelled into a middle-income economy, Greece might finally be able to get assistance from the World Bank. All of this might happen in the next decade, or perhaps in the decade after that.

 

By contrast, a no vote would at least open the possibility that Greece, with its strong democratic tradition, might grasp its destiny in its own hands. Greeks might gain the opportunity to shape a future that, though perhaps not as prosperous as the past, is far more hopeful than the unconscionable torture of the present.

Edited June 30, 2015 by Bananas

[Bananas]

And another http://www.nytimes.com/2015/06/29/opinion/paul-krugman-greece-over-the-brink.html?_r=0 from Paul Krugman.

 

Some snippets.

 

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It has been obvious for some time that the creation of the euro was a terrible mistake. Europe never had the preconditions for a successful single currency ? above all, the kind of fiscal and banking union that, for example, ensures that when a housing bubble in Florida bursts, Washington automatically protects seniors against any threat to their medical care or their bank deposits.

 

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Greece should vote ?no,? and the Greek government should be ready, if necessary, to leave the euro.

 

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And this collapse, in turn, had a lot to do with the euro, which trapped Greece in an economic straitjacket. Cases of successful austerity, in which countries rein in deficits without bringing on a depression, typically involve large currency devaluations that make their exports more competitive. This is what happened, for example, in Canada in the 1990s, and to an important extent it?s what happened in Iceland more recently. But Greece, without its own currency, didn?t have that option.

 

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This is, and presumably was intended to be, an offer Alexis Tsipras, the Greek prime minister, can?t accept, because it would destroy his political reason for being. The purpose must therefore be to drive him from office, which will probably happen if Greek voters fear confrontation with the troika enough to vote yes next week.

 

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So it?s time to put an end to this unthinkability. Otherwise Greece will face endless austerity, and a depression with no hint of an end.

Edited June 30, 2015 by Bananas

[HellasHab]

 

the Samaras administration was getting to the point of building credibility with the Troika and would have gotten way better terms

 

If they were doing such a great job then why didn't he win the elections?!  I like how this moron is coming out now criticizing every single thing the current administration has done and pouring on the fear mongering real thck- it is clear he is a shill for the EU and the bankers who run the whole show.  He was IN POWER just a few months ago, why the hell didn't he negotiate a good deal for the country when he was PM?!  The whole political system in Greece is one big gong show IMO, is there not one competent politician in that country or are they all bought and paid for?!

 

 

At the end of the day Greece has played by the European Union's rules, and they have led us to what all the experts are agreeing on....Worse off than the great depression....We've gone backwards.

 

Exactly and the is all by design and precisely the reason why they should leave EU (its going to collapse eventually anyway so better to get out now).  The EU and the bankers only care about getting their money back, they don't care anything about the wellbeing of the populace.  Its clear that these people don't want a deal that is why this side show has been going on seemingly forever without any resolution in sight.  If they really wanted to help Greece get back on track and start fixing its economy then they would have come forth with more acceptable terms and the two sides would have actually reached a deal by now.  The reforms demanded have to take into account the current economic reality, namely that the country is in a depression and this means that changes must be implemented gradually and be tied to the performance of the economy.  The previous government did nothing but sell out the country, they were pretty much agreeing to everything that the Eurocrats were asking and even had started the process of selling off assets.

 

What Greece needs is a strong, competent individual who will stand up to those who want to destroy the country (they have succeeded to an extent as the econony is in shambles) and bring them back from the abyss.  Does such a person exist, I don't know but I sure hope so for the sake of all our brothers and sisters in Greece.

[Bananas]

Excellent post Bananas....Greece must vote no, by voting yes what are they voting for? Higher unemployment, no jobs, and continued shrinkage in the economy.

 

To me, a yes vote is a vote for fear of the unknown ... which is fair enough.  It is scary.  It is also a vote for the preservation of existing asset values and debt values.  If Greece introduces a new currency, effectively anyone that has assets in Greece will see their value probably halved, so this is definitely a big hit.  But the biggest thing about a yes vote, is that it's effectively a vote to condemn the youth of Greece to high unemployment indefinitely.  This is the worst aspect of the austerity, and one the EU has shown they are not too bothered about.  The vote from my perspective is, do I worry about my pocket now, or worry about what sort of a country my children will inherit.

 

A bit melodramatic I know, but that's what this is about.  What will give Greece the better outcome in the long run.

[HellasHab]

 

HellasHab, Since when did Samaras ''call an election''?

 

Sorry, my mistake.  What I meant to say is 'why didn't he win the elections that were subsequently held'.

[js1000]

 

 

We should be clear: almost none of the huge amount of money loaned to Greece has actually gone there. It has gone to pay out private-sector creditors ? including German and French banks. Greece has gotten but a pittance, but it has paid a high price to preserve these countries? banking systems. The IMF and the other ?official? creditors do not need the money that is being demanded. Under a business-as-usual scenario, the money received would most likely just be lent out again to Greece.

Read this and re read this, and 3 months down the line more of the same in exchange for further 'reforms' but you know what, they'll get away with it because the Greek people will vote in favour of the bailout because of fear.

Any reforms are completely pointless while the above is happening every few months. 

[RED SHERIFF]

@js1000

 

the australian economy and socio economic structure can't be compared to the Chinese...

 

there is nothing inhumane about the government not giving me a pension after 40-45 years of work...

 

the government has provided me and my parents a fertile system that has enabled me to benefit and I don't need a $400pw handout...when I can earn a lot more through my hard work and investments..

 

@jvc

 

its all well and good to say we have massive tourism and strong shipping industry...agriculture that we can grow and possibly untapped resources...

however.....we don;t have the political will to exploit or harness any of this....for all this to work we need to educate the public that the system does not owe you a living...and a free ride..the entitlement and job for life mentality has to end...pensions are at 67....regardless of EZ.TROIKA.MERKEL..

[RED SHERIFF]

@js1000

 

the australian economy and socio economic structure can't be compared to the Chinese...

 

there is nothing inhumane about the government not giving me a pension after 40-45 years of work...

 

the government has provided me and my parents a fertile system that has enabled me to benefit and I don't need a $400pw handout...when I can earn a lot more through my hard work and investments..

 

@jvc

 

its all well and good to say we have massive tourism and strong shipping industry...agriculture that we can grow and possibly untapped resources...

however.....we don;t have the political will to exploit or harness any of this....for all this to work we need to educate the public that the system does not owe you a living...and a free ride..the entitlement and job for life mentality has to end...pensions are at 67....regardless of EZ.TROIKA.MERKEL..

[RED SHERIFF]

I care very little for Germany or Russia or anyone else...

 

I always envisaged and hoped for a modern progressive Greece.....Unfortunately I saw that only being achieved with the direction/guidance/influence/  and strict EU adherence to policies and structures..

 

I fear that going alone will see us resort to all the bad practices of the 1970s and 1980s......we just simply don't want to reform..

 

no point having massive resources if PAME, Syriza , KKE are going to stymie every attempt to turn resources into jobs and income...

these guys need a massive awakening from their ideological dribble....yes...the oil and gas resources will be exploited by mega rich types like Tzigger, Kokkalis, Marinakis, Savvidis, Meli, Savvidis, Mytelineos etc etc....in conjunction with Shell/BP/UK/EU/USA.....That is how the world functions...

the result will be jobs for people ,taxes, investment and growth...

 

KKE/Syriza would rather argue about words in the 'syntagma' to 'protect the lao' from greedy capitalists..

[js1000]

 

there is nothing inhumane about the government not giving me a pension after 40-45 years of work...

the government has provided me and my parents a fertile system that has enabled me to benefit and I don't need a $400pw handout...when I can earn a lot more through my hard work and investments..

Well the UK government owe me a pension, I pay 

Income tax Local Authority/property tax VAT(on almost everything)

Tax on alcohol, tax on tobacco, tax on fuel (around75%each time i fill up) inheritance tax, airport tax, road tax, thousands in 'stamp duty' every time a property is bought, National insurance contributions, Capital gains tax, tax on savings and investments, TV license.

yet they plead poverty and always want a little more while giving their corporate buddies tax breaks.

 

I provide the state with money through my efforts so yes i expect a little back when i retire, particularly given the extraordinary wastage mismanagement and incompetence by government with my funds. 

 

 

I always envisaged and hoped for a modern progressive Greece.....Unfortunately I saw that only being achieved with the direction/guidance/influence/  and strict EU adherence to policies and structures..

Their policies are starving Greece, the wastage mismanagement corruption and incompetence throughout the EU makes even the UK government look competent. 

Their direction/guidance/influence/policies and structures are ones of impoverishing Greece through austerity and privatisation of out assets in exchange for loans that go straight back out to creditors with further interest.

Their policies prevent countries being self sufficient(in exchange for subsidies) in order to create dependance with other EU nations.

like i said earlier reform is pointless until we exit this union and currency, i just hope the Greeks are brave enough to see it through although i think they'll bottle it

 

 

 

when i read the ez's/troika's methods of growing the greek economy are failing - so we have nothing to lose;: then you know the poster isn't well-informed as it wasn't the ez's/troika's intention nor interest to grow our economy with these loans - they want their money back, firstly.

Agree, its not about growing our economy its about getting their money, be it through new loans or asset stripping the Greek state.

 

 

?The IMF?s loans to Greece have not only bailed out banks which lent recklessly in the first place, they have actively taken even more money out of the country. This usurious interest adds to the unjust debt forced on the people of Greece.?

 http://jubileedebt.org.uk/news/imf-made-e2-5-billion-profit-greece-loans

Edited June 30, 2015 by js1000

[RED SHERIFF]

I pay all those taxes too..

 

however its no longer an entitlement.... the pension in Australia is not for everyone...

[Brklyngrk]

Quote

If they were doing such a great job then why didn't he win the elections?!  I like how this moron is coming out now criticizing every single thing the current administration has done and pouring on the fear mongering real thck- it is clear he is a shill for the EU and the bankers who run the whole show.  He was IN POWER just a few months ago, why the hell didn't he negotiate a good deal for the country when he was PM?!  The whole political system in Greece is one big gong show IMO, is there not one competent politician in that country or are they all bought and paid for?!

 

I am new to these forums, express my opinion and get called a moron over what is sound reasoning. Instead of having an honest debate, I get critized for posting.  Way to encourage new people to express their opinions.  I am in these forums as I believe many of us are, because we genuinely love Greece and its people and are upset on all that has transpired over the last few years.  There have been many mistakes made by all parties.  The reason I blame Tsipras is for his unprofessionalism in handling negotiations.  You do not set up a referendum after a deadline has passed.  That's amateurism at its finest.  To go over your logic, Syriza has been in power for a few months as well, why haven't they closed a good deal.  If you remember their campaign promises, they would have ripped the deal and Europe would have forgiven our debt.  All these things take time, you can't reverse something in a few months that took years to make.