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The Greek Economy Thread


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At the end of the day, was Greece in a better position before the Euro, say in the 1990's or now ?  That is the most important question.  There is no reason why Greece couldn't return to an economy of that level after a Grexit.

 

If that's the best they can do due to their crazy labour laws, left right crazy politics (which as Che pointed out is all such a load of s%$#!, I can't believe anyone believes in that crap these days), people taking 10 years (lol) to finish their degrees, then so be it.  That's as far as the Greek economy can go.  If they want to do better, then they'll have to do it off their own bat, but at least they'll have done it themselves (or not), as opposed to having EU technocrats governing the country.

 

 

Buying power will be cut in half.  So that 500 Euros a month will be worth 250 Euros. Drug dealing, stealing, and prostitution will reign supreme.  All fine and dandy if you want to buy Feta Cheese but won't be all fine and dandy when you need to buy medication or gasoline for your vehicle or a television or for that matter anything outside of Greece.  Greece will be a Banana Republic.  Corruption and theft plus monopoly money LOL.  We are probably the most uncivilized country in Europe.  We should just align ourselves with Africa and Central America and be done with it.

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Buying power will be cut in half.  So that 500 Euros a month will be worth 250 Euros. Drug dealing, stealing, and prostitution will reign supreme.  All fine and dandy if you want to buy Feta Cheese but won't be all fine and dandy when you need to buy medication or gasoline for your vehicle or a television or for that matter anything outside of Greece.  Greece will be a Banana Republic.  Corruption and theft plus monopoly money LOL.  We are probably the most uncivilized country in Europe.  We should just align ourselves with Africa and Central America and be done with it.

very true gyros, however that will only be short term, people will flock to greece and invest in greece because of they value for money they'd get from their own currency being so much stronger than any greek currency, then a recovery can begin slowly, if they stay as they are then there's no hope, the EU has proved to be a disaster, its made rich countries poorer and poor countries more expensive and has never been audited, you can talk about greek corruption and incompetence until you're blue in the face but the EU has similar issues on a bigger scale.

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very true gyros, however that will only be short term, people will flock to greece and invest in greece because of they value for money they'd get from their own currency being so much stronger than any greek currency, then a recovery can begin slowly, if they stay as they are then there's no hope, the EU has proved to be a disaster, its made rich countries poorer and poor countries more expensive and has never been audited, you can talk about greek corruption and incompetence until you're blue in the face but the EU has similar issues on a bigger scale.

 

I don't understand why investment would flock to Greece when it never flocked to Greece during the drachma.  All the factories closed because of how mighty the unions are.  Who would open anything up in Greece when it will turn into a nightmare.

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VERY TRUE....

 

Investors wont flock to greece simply because of the drachma.....We will be seen as even more unstable and unattractive than ever...

 

@Bananas

 

the standard of living in Greece was not great prior to the 1990s....a lot of crazy wild spending and two bob millionaires....was the catalyst of what we have today.....Andreas Mr.PASOK started the rort, people were not accountable the gravy train would not last forever.....

 

you may scoff at the right v left debate as some cold war joke...however the 10 year uni degrees and unfriendly labour laws etc are inventions and protectorates of the 'infamous greek left psyche'.....the whole nation has a warped unhealthy perception on these issues...

 

just take some time and listen to the air time given to clowns like kke and the rubbish they talk about....any serious commentator would laugh them off the planet, but in Greece they feed the beast and treat them as if they are 'legit'???

Syriza is the modern sitcom version of kke.....

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tourists would definitely come in greater numbers, people stopped coming because they can get more for their money in places like egypt and turkey, also lifting visa requirements for russians would see loads of people coming and i believe the cheap cost of property would see people buying up properties, thats the only way to start any sort of recovery, do you seriously think staying as we are is any sort of solution, being dictated to by an organisation even more bent then our own government.

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we have had record growth in tourism over the last 10 years.....people have not stopped coming

 

we had 21-22 million tourists last year.....  A souvlaki at 2-3 euro or 1-2 euro(or the equivalent in drachma) won't alter tourism numbers.  The costs of goods and services in greece are not prohibitive to quality modern tourists...

Also quality tourism requires constant upgrading in infrastructure, standards of hotels etc...this can't be achieved by an economy on the brink or one dealing in unwanted drachma.

Greece can't become a 'Fiji'  or 'Bali' style tourist destination.   It needs to become a modern,sophisticated destination competing with the best of Europe.....

 

be careful what you wish for? Turkey and Egypt tourism means Turkey and Egypt prices? = Turkey and Egypt standard of living and labour laws...

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in that case we stay in the EU do what the troika tell us, privatise everything to pay off debts, further impoverish our people with cuts/austerity demanded by the troika and blame the 'left wing' the unions and the 'greek mentality' for everything. Seems the western media narrative of greeks being lazy scrounging idle tax dodging people who are being propped up by a charitable EU is quite correct.

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its not that Greeks are lazy as such....

 

its more of a case of Greeks not have a true understanding of the mechanisms of a viable modern economy....nor what the role of government is in our lives....the government does not owe us a living..

they lay the framework and rules for us...we make our own luck...

 

the tools required to create proper investment and wealth are foreign to Greeks...

 

10 year degrees that lead nowhere are not the 'governments fault nor the troikas'.    its a mentality that has been fostered and nurtured for decades....

 

the troika simply want us to function like other EU member states......there are rules and processes...

cutting corners greek style circa 1980 is what got us in the poo...

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The greatly devalued drachma will make Greek products much more competitive (cheaper), but this assumes Greece will have lots to export. However anything it'll import will be extremely expensive, which includes all everyday items Greeks are accustomed to having. Same with imported food stuffs. If the country produces enough food stuffs to feed itself, no problem. If...

 

Now, they'd have to pay for imports with hard currency, because no one would accept a worthless currency for payment outside the country. Where do you get it? From exports and from tourism. Red Sherriff makes great points (above) about the tourist economy. Be careful what you wish for. There are many poor countries whose tourism industry is foreign-based. In other words, foreign investors come in and handle most of it. Yes, they employ locals thus creating jobs. Good. But, there are many poor countries who have great tourist destinations, some luxurious places for tourists to stay. Yet, why do you think the countries remain poor?....

 

What makes a country or a person poor? It's not a simple answer. It depends on the quality of life. And, in western societies it's largely maintaining/enhancing the welfare state--the services and the social safety net, education, health care, etc. Poor countries can't provide this safety net, which on the other hand is expected/demanded in western countries. Also, economic opportunity should be available to everyone not the investors; this doesn't mean the government has to employ everyone, but surely doesn't mean being employed in low-skill jobs at starvation wages.

 

For all the rhetoric from Syriza and others about national independence, what became clear to them is that if Greece left the euro, there were NO good options, because there are systemic problems in Greece that would basically waste the one-time fix (going back to the drachma) for the reasons I just explained. Since NO political party is willing to do the tough decisions to correct the systemic problems, they actually prefer that those tough measures are dictated by the "troika."

 

What the "memorandum" means is, you want our money, here are the conditions. You don't have to take this money, by the way. But, if you declare bankruptcy, don't come to us for help either.

 

...

 

PS. I'm not suggesting that the troika's package deal is ideal or even correct.

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the troika simply want us to function like other EU member states......there are rules and processes...

cutting corners greek style circa 1980 is what got us in the poo..

like Ireland Portugal Spain Cyprus and Italy they're also in the poo. 

who made these 'rules and processes'  and for what ends?? basically they want to dictate policy and demand austerity in 'sovereign' countries. 

and what about european countries who are not in the EU, how do they manage to function? the whole EU is undemocratic, when french and dutch voters voted no to a new constitution they simply changed the wording to a 'treaty' when Irish voters voted no to the Lisbon treaty they were made to vote again, when private banks went tits up in Cyprus well we know what happened there, the whole EU is a mess and needs to be disbanded but instead its swallowing up more countries.

 

like i said, as bent and incompetent as the greek government is, the EU whose commissioners make all the rules are not elected and have never been audited because of their own corruption have no business dictating to Greece. To me their arrogance is staggering and I don't want their meddling/dictating in Greece. 

 

the government does not owe us a living..

they lay the framework and rules for us...we make our own luck...

supposing those rules favour some and penalise others, suppose its not a level playing field?? besides its the EU that are laying the framework and rules for greeks, now if you think that there are no other options because greeks are too stupid to ' have a true understanding of the mechanisms of a viable modern economy....or what the role of government is in our lives' then there's no hope for Greece and they need the EU to govern them. 

 

 

For all the rhetoric from Syriza and others about national independence, what became clear to them is that if Greece left the euro, there were NO good options, because there are systemic problems in Greece that would basically waste the one-time fix (going back to the drachma) for the reasons I just explained. Since NO political party is willing to do the tough decisions to correct the systemic problems, they actually prefer that those tough measures are dictated by the "troika."

one wonders how Greece even survived as a nation before they joined the EU.

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@JS100

 

you say European nations can prosper without EU?

 

I ask which backward,Balkan state without proper industries has prospered outside the EU?

 

The areas that Portugal,Spain, Cyprus have suffered are similar to our shortcomings....where they have maintained ahead of us is that they don't have the same complex over bearing antiquated sociopolitical system that we have....not to our extent...

 

the 'framework' to success is not an EU troika way to control.....the 'framework' is the one that gives us the opportunities living in more advanced modern societies....

 

In short...we got it way wrong some 50 years ago...and refused to see the 'light'....

 

we refused to become a version of Holland or Belgium  but chose to become Serbia or El Salvador.

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croatia was doing ok before they stupidly decided to become the 28th member recently and also slovenia. romania other than losing most of its working people to other EU nations hasn't really benefited from joining, Bulgaria's tourism and construction was booming with tourists flocking there because it was so cheap but prices have now risen sharply there since they joined.  

 

Portugal saw property prices rise sharply with brits and germans snapping up property in the algarve but wages there did't really rise and we saw the portuguese protesting because they couldn't afford property in their own country.

 

Cyprus was doing ok before they joined, strong pound, good economy, low unemployment - look at them now, still divided, high unemployment, rising population huge reduction in wages, young educated cypriots leaving for other countries in order to find work with the island being full of foreigners. 

 

yes you make good points about greece but you cannot champion the EU as some sort of benevolent organisation that countries can't survive without, its undemocratic, its even more wasteful and corrupt than even Greece and the people now suffering in Greece through the EUs austerity demands are not the ones that caused the crisis in the first place. Just like in Cyprus, those that had their savings stolen by the banks (i believe they call it a 'haircut' in order to conceal what it really is) were not the ones that caused the mess. 

 

if you have your own currency you can devalue try and attract foreign investment and would have more tourists coming because it would be so cheap for them, but all i'm hearing here is that greeks are too stupid and need to be governed by the EU. 

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if all we can hope for is to become another Croatia or Bulgaria then god help us??

 

don't forget these countries are nothing to aspire to....also their GDP per capita has always been much lower than Greece especially prior to 2008......and any growth in these countries + Romania and Slovenia needs to be put in the context that they started from an extremely low base in the first place

 

you are obsessed with 'tourism'....tourism in Greece is as strong as it has ever been...the currency is not the issue in tourism...

we can't keep flogging this old chest nut....we are not Bali or Fiji...

 

Construction in places like Bulgaria has more to do with being more friendly to foreign investment, as is FYROM...Greece is terrible at this...we have no  policy for proper investment...Greeks need hundreds of thousands of real jobs paying a decent monthly salary...this is big picture stuff...not frappe makers...

 

Cyprus is a tiny nation with a tiny economy....Greece is far more complex the two can not be compared...

 

Portugal is struggling, but they are not on the brink as we are, mainly because the political landscape is vastly different...they do not have characters like Kanelli on prime time radio preaching  her manifesto 'on new world order' and the 'bad capitalists'..

 

sadly Greeks are too stupid to realise how these proper economies work....

 

 

would the nation and the individuals be better off if at 19  they decided that in fact they are better off becoming 'cannon fodder for the capitalists' and getting a job, instead of hanging around universities at 35 unemployed and planning their next fire bombing???

 

frappe anyone?

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It's a disgrace and the people to blame are the various governments and the unions. What makes it worse is that there was car production in Greece in the past albeit on a small scale. Just imagine the jobs there would have been the tax payers. How can politicians and union barons not see this. It is not rocket science

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Lets take a look another at the car industry in the EU.. remember.. the EU offers help to countries who want to invest in this industry so that Europe is not dominated by foreign car makers.... where is Greece?

don't understand this comment.

Japanese companies manufacture cars in Britain so do German companies, they are both foreign companies, where does EU membership come in?, I'm sure if Germany were not EU members they'd continue making as many cars as they do now. 

 

In the UK manufacturing is now almost non existent, people were quick to blame the unions for the closure of factories, but the truth is companies found it cheaper to use sweatshop labour in the far east and used the unions and the 'lazy british worker' as a convenient excuse for their outsourcing. yet in Germany unions are strong and wages are high and they still find it economically viable to manufacture in Germany.

 

Turkey has 15 plants despite not being in the EU, even Serbia has 3, and Greece doesn't make the list despite being EU members. where's the benefit of EU  membership for Greece??

 

 

 

Unfortunately they don't even produce bicycles in Greece.  Everything in Greece gets pillaged until there is nothing left. The Greek mentality is something unseen in civilized world

I get that, that's all i'm hearing, that we're a bunch of uncivilised anarchists, but where's the benefit of being governed by a corrupt unaudited organisation?

Its not all bad though, we make a decent gyro and a lovely frappe.

 

what ever happened to all those recent plans for Solar energy and wind farms?

how is the gas/oil explorations going?  we were told that by early 2015 we would have significant reports?

wind farms don't work, they've proved disastrous in the UK, the government has subsidised them and got far less in return, what they produce is minimal and the subsidies have caused energy bills to increase.

the gas/oil exploration and solar? perhaps we're waiting for the EU to sort it all out for us while we sip our frappe. 

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For how bad the EU is, Greece gets more money in subsidies than it pays.  Not a bad deal.  The subway and new roadways all over Greece probably wouldn't have been built without the EU's help.  We'd still have the antique freeways with 2.5 lanes.

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what ever happened to all those recent plans for Solar energy and wind farms?

 

how is the gas/oil explorations going?  we were told that by early 2015 we would have significant reports?

 

Energy development requires foreign investment, where else will Greece get the money from but who the hell wants to invest in Greece with this mickey mouse government running the show? 

 

Greece needs to attract foreign investment, start exporting product besides olive oil and feta and create jobs. 

 

26% unemployment is simply incomprehensible. 

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First of all, we still need reforms.  No more "hazardous" retirement jobs like bakers and musicians who can retire at 50 or people getting pensions that are higher than their final year salary.  The pillaging has to stop.

 

International investment will never come with the country being operated by borderline communists.  Nobody is going to start industry here only to be kicked out.

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The EU knows the value of car firms setting up in the EU. It doesn't matter who owns them. What matters is that the factories are built in the EU, by EU citizens, the workers are EU nationals and the cars produced are to European spec.  Therefore the EU encourages foreign firms to set up within the EU. The fact that Greece has fought this process to actually make sure no one builds any cars in Greece is spectacular. 

so why can't the UK government do all of the above without being members of an unaudited club that costs them net

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furthermore foreign investors need a stable environment where growth is not sabotaged....

 

Asian investors have come to invest in the Australian property market because it's secure and long term it won't suffer even if at the time the prices are artificially inflated....

 

going back to the drachma or even in the current depressed market Greek property is cheap but only as a 'cheap option'....somewhere to 'spend/waste' a few dollars for a holiday pad.....not a market to invest for long term growth...

 

Syriza, from a point of view of growth and investment and 'foreign credibility' where the worst option for Greece.

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I have stated in the past that even if the debt was written off in a few years we will be back in the poo....For the very same reasons you say...

 

Also, regarding tax collection.....I also said how can syriza collect tax from 'working class people' effectively???  how can syriza be seen as 'punishing the masses'?

 

How can Syriza set KPI s for Executive staff and Managers at the Tax office who will be tasked with making sure tax dept. staff increase productivity in conducting tax audits....and then also be more efficient and effective in collecting tax from high caliber audits?

 

How can syriza 'fast track' the legal process thru the Courts to prosecute tax dodgers?

How will Syriza allow the Courts to enforce orders against 'The Lao'

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