The Eurozone Crisis Thread

I know there's a Greece thread, as well as the UK and US Economy Shitbins, and the French politics thread, but I think having all the relevant Eurozone stuff in its own place - what with Spain teetering and German Austerity questioned and the rise of Right and Left groups that we should have a catch-all for our old friend The Euro and the difficult times it faces.

Spain warns Euro is finished without fiscal union

https://www.youtube.com/watch?v=x6sYTEmHKAE

It's impossible to have any informed opinion on what's really going on because everyone has their own agenda. I try to keep that in mind when I try to follow the news. (RT.com : the whole western world is one big scam! - Anglosaxon media and economists: enthusiastically jump at any hint that the euro may be in trouble possibly - pro-european media: the euro is the one thing that saved europe from the 2008 crisis that those american banks caused - etc etc) - we'll see what happens, no use in having an opinion beforehand.

Krugman put up a little blog about the Estonian thing, and the Estonian President tweeted:

toomas hendrik ilves ‏@IlvesToomas
Let's write about something we know nothing about & be smug, overbearing & patronizing: after all, they're just wogs: http://krugman.blogs.nytimes.com/2012/06/06/estonian-rhapsdoy/

toomas hendrik ilves ‏@IlvesToomas
Guess a Nobel in trade means you can pontificate on fiscal matters & declare my country a "wasteland". Must be a Princeton vs Columbia thing

toomas hendrik ilves ‏@IlvesToomas
But yes, what do we know? We're just dumb & silly East Europeans. Unenlightened. Someday we too will understand. Nostra culpa.

and he continues!

Let's sh*t on East Europeans: their English is bad, won't respond & actually do what they've agreed to & reelect govts that are responsible.

BBC Analysis: Eurogeddon II http://www.bbc.co.uk/programmes/b01k1nh0

o rly

“Forecasters significantly underestimated the increase in unemployment and the decline in domestic demand associated with fiscal consolidation,” Blanchard and co-author Daniel Leigh, a fund economist, wrote in a paper on growth forecast errors. The authors essentially admit that they failed to consider important factors about how regions might react to austerity in times of financial crisis when they advised IMF austerity policy.

http://www.salon.com/2013/01/04/imf_economists_apologize_for_austerity_forecasts/

so, this cyprus thing! it's crazy, right?

It is!

isn't cyprus still occupied by turkey?

northern cyprus is. the rest of cyprus is occupied by drunk british squaddies.

So much dirty money in Cyprus, at the moment, taxing some of it looks superficially attractive but, yes, this seems crazy.

isn't this going to result in panic in italy, greece et al?

that's the plan. get italy used to the rapidly approaching future

the german colonization of europe through non-military means

oh ... kay

maybe that's controversial by suggesting motive but it's an accurate description of what is happening

Colonisation by an elite of ideologues, not "Germans"

ok, and iraq was invaded by an elite of ideologues and not "americans." it's german fiscal policy that is driving this.

this is a good move if it's being done as a purely socialist alternative to crushing austerity measures, especially as cyprus, with its predominantly tourist-driven economy, isn't very affluent, and a great deal of the wealth is held by non-nationals.

the best alternative would be to write off debt but that isn't happening. at least this is a way to alleviate the debt that exists.

cyprus has already been colonised by expat oligarchs, will hold judgement on this new measure until its results are plain. but it seems like a good and surprisingly egalitarian deal.

look at the work-for-free shit we're putting up with in the uk and tell me that some weighted version of this wouldn't be preferable to austerity! obviously there's a totally different economy here and it wouldn't ever come close to happening what with our neocon fucktards at all levels of government and opposition but still. would obviously have to do it first and then announce it to prevent a run on the banks. c'mon, it'd be lolz. vaguely ORWELLIAN lolz.

is german fiscal policy so terrible? surely sustainable economy is far preferable to boom'n'bust at this point

how is this not austerity by different means? 6.7% tax on all deposits under $100k is going to hit an awful lot of middle + lower class ppl

it's a mugging

not that hard

cyprus isn't a very wealthy country. cost of living isn't that high, unless you're living in a gated resort with a spa and a load of native flunkies. this will hit the landowners, hoteliers and other exploiters hardest, which is i'm sure you'd agree the way it should be

why don't you think it will hit lower income ppl with savings?

because they won't, on the whole, be entitled fuckberks about it

unquestioned criticism of austerity is really getting on my tits (where "austerity" = "why cant we live in bubbleland)

austerity fundamentally depresses and doesn't stimulate a recessive economy, which in turn increases debt and austerity measures. it's dumb and it's exploitive. euro bonds are such a better idea.

nothing fundamentally does anything in a x -> y statement in re govt actions/economy

you are wrong

austerity is actually by definition depressive

yeah, all expenditure in an economy is equally recycled and efficient domestically wrt the multiplier effect huh

"austerity" isn't anything more than "what happened?" as it is being used by 90% of ppl atm in europe xp

i don't live in europe & understand that u r taking this position 4 challops/out of exasperation (which i admire) but you're still def wrong

i'll certainly admit that any position i take will be itself overly simplistic- and tbf i realise that ilx isn't hopefully as blanket-lazy about it's use of the word.

but 'austerity' in ireland is nothing more than an attempt to target current spending in an intelligent manner because our deficit is astonishing.

there are of course many ways & means to do this along different political, economical and social theories, and there is of course other such avenues that say you shouldn't be doing it at all. in the absence of any wide-ranging agreement as to how else you plug the gaping streams in individual national budgets (and markets are not rushing in to do so) then here we are.

yes, it'd be great were germany to throw her weight behind measure to put an end to uncertainty in order that the 'short-term' fiscal crisis is eased in a managed way. but the idea that there are not very good reasons that governments across europe should be trying to cut their cloth to measure seems to me to be a far too slavish devotion to kenynesian thought.

this is a good move if it's being done as a purely socialist alternative to crushing austerity measures

it isn't, and the practical effect won't be "purely socialist" either. it's a de facto flat tax, given the "progressive" bit doesn't kick in until you have savings of more than €100,000. flat taxes are not socialist (i.e. not redistributive) even when the beneficiary is the state, but the direct beneficiary here are the bank bondholders who come out unscathed.

look at the work-for-free shit we're putting up with in the uk and tell me that some weighted version of this wouldn't be preferable to austerity!

this is a ludicrous false dichotomy. this has nothing to do with state austerity. cyprus's problems are unusual because their domestic banks (and their debts) are many times the state GDP, which makes the state vulnerable when things go wrong in the banking sector.

maybe my main quibble these days is with the measures we are using to define the success of domestic economies, idk.

the german colonization of europe through non-military means

― Mordy, Sunday, March 17, 2013 3:46 PM (1 hour ago) Bookmark Flag Post Permalink

maybe that's controversial by suggesting motive but it's an accurate description of what is happening

― Mordy, Sunday, March 17, 2013 4:00 PM (1 hour ago) Bookmark Flag Post Permalink

you sound like marcello. that's not "controversial" by suggesting motive. that's utter bullshit by suggesting motive.

i'd prob allow that germany is wreaking havoc to the eurozone through misguided (?) attempts at self-protection, the idea that the damages caused is an intentional or desired outcome is......silly

i guess my main problem with this is that, in their apparent desire to teach a lesson about moral hazard to the people who aren't the problem (savers at retail banks), isn't it *obviously* going to result in a run on banks in cyprus? and an increase in the risk of that in italy, spain, etc. all for what isn't actually that much money. like as well as being regressive and unjust, etc. is just seems completely fucking stupid.

so what do they get ito equity?

I wonder whether there is an ulterior motive in trying to keep Greece on track. Huge numbers of wealthy and moderately wealthy Greeks shifted their savings to Cypriot banks in the fear that domestic ones would collapse or, more feasibly, that Greece would convert back to the Drachma. This will come add a pretty sharp disincentive to doing that again.

Seems strange not to do this as a wealth tax, rather than simply penalising savers. A million Euro holiday home is left untouched but a million Euro in the bank will be decimated.

Christopher Pissarides, a Nobel Prize-winning economist and chairman of the government’s economic advisory committee, warned that the island’s economy would collapse within “two or three days” if the legislation failed to pass.
“If the law isn’t voted through, what happens will be much worse. There will be many bankruptcies and most Cypriots will lose everything because the banks will not reopen,” he said.

hmm.

Mr Anastasiades explained that Cyprus gave way after the ECB threatened to push the island into a disorderly default by withdrawing liquidity support for Laiki, its second-biggest bank, on Tuesday.
He said Cyprus had a choice between “a catastrophic scenario of disorderly bankruptcy, or a scenario of a painful but controlled management of the crisis”.

oh je.

always a good thing that I roadtest my halfbaked first impressions, ty caek, altho tbf I did concede the false dichotomy point in the original post, along with a clear statement (backed up by y'self) that most of the money in cyprus is held in banks by foreign nationals

it's more socialist than letting the economy fall apart! if indeed that was what would have happened

the point that we have reached in contemporary capitalism: paying for bank bailouts w/ the savings of a country's ppl in order to preserve the rapidly depleting capitalism husk is more socialist than idk communism?

ja, sorry, "ludicrous" a bit strong, but i think it's a pretty confused interpretation of this to consider it socialistic.

cyprus's finance minister 17 days ago:

Cyprus's new finance minister on Friday ruled out a haircut, or imposed losses, on bank deposits to ease a financial bailout from international lenders, now stalled amid worries about debt sustainability.

"Really and categorically - and this doesn't only apply in the case of Cyprus but for the world over and the euro zone - there really couldn't be a more stupid idea," Michael Sarris, who took over his post on Friday, told reporters.

Sarris, a widely respected economist, was the first appointment of new Cypriot President Nicos Anastasiades, who won presidential elections on Feb. 24 on a platform of constructively attempting to seek a deal with lenders.

letting the economy fall apart would not result in communism or anarchism or what I believe may be ideal: localised economies

it would result in exploitation, foreign first-world sharks moving in and buying up land and people, cyprus finally sublimated as luxury mediterranean commodity with no autonomy whatsoever (more so than at present), slave labour and capitalism of a far nasties kind than this bureaucratic fudge

what's the solution? dunno. open table.

first maybe return northern autonomy to cyprus government

what would that do?

all for what isn't actually that much money.

is it really not that much? or is it only considered too much relative to cyprus gdp?

it's not that much from the POV of the ECB

haha this is a clusterfuck

This is so dumb and counterproductive and people at all ends of the political spectrum seem to agree, but whatever this is/was, it certainly isn't socialism.

Some background on the Russian connection:

http://m.bbc.co.uk/news/business-21831943

Lots of that money is filtering through Cyprus to the rest of the EU at the moment. Inflating property prices in London too. A Cypriot agent that acts on behalf of Russian clients offered my mother an insane amount of money for some commercial property she inherited - more than twice the market value, last year.

Rethinking this. If it pisses enough people off to bring about mass redeployment of funds into credit unions, it'll have been an inadvertent success. Otherwise, it's enforced chipping-in where what is chipped into is most probably a reloading gun

oh ... kay.

Cyprus may drop tax for small savers

Cyprus now says bank depositors with savings under $26,000 would be exempt from a levy, amid continuing outrage over a bailout plan.

Better. Exponential curve, Cyprus!

every article i've read about it is a mixture of bafflement and anger. the ft seemed kind of amused at the incompetence this morning, implying that basically what happened was all the negotiators were very tired and got confused over the weekend. shops, hotels, etc. refusing credit cards apparently.

i imagine there was some idea of an ultimatum like "if you're going to make us do this, we'll do it to everyone!" and then everyone else just called the bluff and whoops.

http://krugman.blogs.nytimes.com/2013/03/17/the-cypriot-haircut/

yeah what krugman says is what I don't get about this -- why isn't this just going to make everyone feel less secure about having their money in Cypriot banks? I mean maybe some of the littler guys won't -- as a cypriot electrician interviewed on NPR said, "where would I put it?" But overall it can't be great for their banking system.

alphaville has some speculation this is a move to lean on russia for a heavier hand in the bailout.

Russia's pretty heavily exposed in Cyprus, right?

yeah max otm in the other thread that this isn't the fait accompli that i (and others) thought it was

i guess the prospect of literal defenestration is proving a strong disincentive

if anything the russians will be hit harder now, since the money still "has to be" raised

weird "mouse that roared" vibe from this

Well Cyprus mps voted it down.

cyprus to EU: gfy

Prime Minister Dmitry Medvedev said the euro zone decision seemed to be aimed at confiscating someone else's property.

"This practice, unfortunately, was well known and familiar in the Soviet period," Medvedev was quoted as saying by Russian media.

Oh man

Plan B, say government advisers, would require state pension funds to hand over about €4 billion of their reserves. Cyprus would ask Russia for the other €2 billion, arguing that Russian companies, with an estimated €25 billion stashed in Cyprus, would then no longer face the prospect of losing 10-12% of their deposits. Michalis Sarris, the finance minister, flew to Moscow as soon it became clear the bill would not be approved.

that's one of the things we did <3 <3 <3 governments/banks

haha ok no touching savings but wipe out retiree's pensions sure that's legit.

Germany's finance minister has warned Cyprus that its crisis-stricken banks may never be able to reopen if it rejects the terms of a bailout.

Wolfgang Schaeuble said major Cypriot banks were "insolvent if there are no emergency funds".

cyprus should just extort russia into paying the whole bill

don't even touch the savings

http://static.guim.co.uk/sys-images/Guardian/Pix/pixies/2013/3/19/1363725322421/Protesters-outside-Cyprio-008.jpg

Marios Mavrides, a government MP and former finance minister, raised the prospect of the country becoming the first to leave the euro. He told BBC2's Newsnight: "If we cannot come up with the €5.8bn in a few days then I think we will go to the Cyprus pound. That will be the end of Cyprus in the eurozone. We're going to exhaust all other possibilities but what can we do? If we have no other solution we cannot leave the people without money."

wtm

to add to my panicked and unproductive waffling upthread, I'm going to Cyprus in September to see my grandmother. will be able to report back on the riotous disrepair utopian barter economy

Prime Minister Dmitry Medvedev said the euro zone decision seemed to be aimed at confiscating someone else's property.

"This practice, unfortunately, was well known and familiar in the Soviet period," Medvedev was quoted as saying by Russian media.

― Mordy, Tuesday, March 19, 2013 10:22 PM Bookmark Flag Post Permalink

"Thankfully," he continued to himself, stroking his siamese cat, "today we conceal it much better...muhahahaha...HAHAHAHAHAHAAAAAA!"

Cops at lagarde's apartment?

Heard something about that too...

http://www.guardian.co.uk/world/2013/mar/20/christine-lagarde-flat-raided-police

yves smith gives her take:

http://www.nakedcapitalism.com/2013/03/cyprus-bailout-stupidity-short-sightedness-something-else.html

14. Even despite all the arbitrariness above, at least it solves the problem right???

Absolutely not. You will haircut 10% of deposits on day 1 to make up a capital shortfall and promptly watch 30% of the rest of the deposits flee the country, leading to a much bigger capital hole that Europe will have to fill.

In addition, this will severely cramp Cyprus’s main economic driver the last 2 years (selling real estate, tourism and accounting services to Russians) so any concept that it will make the debt “more sustainable” comes from a lunatic place in financial modeling. Cyprus is a 78% services-based economy. So, if you assume that GDP growth is exactly the same before and after you confiscate the assets of your clients, well, I have a solvent Cypriot bank to sell to you…

This is so obviously risky, that the more paranoid commentators believe it is a deliberate plan by Germany to end up as a multi-deca-billion creditor to Cyprus to which the pledging its oil and gas reserves is the only solution. I don’t think this is the case, but boy it is getting hard to believe that they are this short-sighted.

all the front pages in germany today are of the demos in cyprus where people held up pictures of merkel in nazi uniform, etc. the german elections later this year are going to be oh boy.

why don't the ppl in cyprus realize that this isn't the germans fault but the fault of an elite of ideologues???

doesn't sell papers.

Definitely German colonisation that isn't a paranoid fantasy

Would welcome it tbh

Could do worse than bratwurst and on-time trains tbh

Dunphy's demand of staunton takes new and sinister significance

http://blogs.reuters.com/felix-salmon/2013/03/22/cyprus-what-are-the-russians-playing-at/

I don’t pretend to understand Russian politics, but

*speculates furiously about Russian politics*

Cyprus now has a binary choice: become a gimp state for Russian gangsta finance, or turn fully towards Europe, close down much of its shady banking sector and rebuild its economy on something more sustainable.

yeah, something more sustainable - exploitation of natural resources (gas) + labor.

With Cyprus facing a Monday deadline to avoid a banking collapse, the government and its international negotiators devised a plan late Saturday to seize a portion of savers’ deposits above 100,000 euros at all banks in the country, in a bid to raise money for an urgently needed bailout.

A one-time levy of 20 percent would be placed on uninsured deposits at one of the nation’s biggest banks, the Bank of Cyprus, to help raise 5.8 billion euros demanded by the lenders to secure a 10 billion euro, or $12.9 billion, lifeline. A separate tax of 4 percent would be assessed on uninsured deposits at all other banks, including the 26 foreign banks that operate in Cyprus.

http://www.zerohedge.com/news/2013-03-22/jpmorgan-inevitability-europe-wide-capital-controls

cool zone

you know, it's remarkable how differently i feel about this savings theft levy now that it's only on accounts of 100,000 or more

Amazing they didn't see the PR disaster of the original plan. Too many people involved who think losing €100 from your savings is bugger-all, I suspect.

http://www.bbc.co.uk/news/world-europe-21771229

bulgarians are setting themselves on fire

*yawn* http://www.bbc.co.uk/news/world-europe-20912616

http://i.imgur.com/K9DVGLg.jpg

Germans otm

rmde at german bougies staying in rental in perpetuity

Stable housing market tho iirc, with v strong tenancy rights

Spain, Italy, Portugal, Greece and Cyprus probably have a much higher percentage of people in their late twenties and thirties still living with their parents.

the net worths for those countries are optimistic/outdated

This is absolutely nuts if true:

http://www.nakedcapitalism.com/2013/04/yanis-varoufakis-greek-banksters-in-action-on-the-latest-twist-in-the-story-of-mafia-style-terror-spreading-through-the-greek-polity.html

On 11th September 2012, late at night, a group of 4 or 5 people staked out my home. It was only accidentally that I avoided being ambushed (my motorcycle had a flat tire and I thus returned home in a friend’s car). Upon noticing the stalkers I called the police and asked them to come quietly. The police arrived noisily and went to a nearby house first, thus giving the men plenty of time to make their escape. For days, the police refused to investigate properly or to call eyewitnesses to make a statement (later, after I published the story, they did). Since then, I have been denied police protection (unlike most other journalists) and have had to resort to private security.

Soon after the failed ambush, a woman visited my office insisting that I should see her to discuss “the bankers’ designs” on me. I decided to meet with her. She was a frightened woman who claimed to be in grave personal danger. She said that she had been, and was, part of a group comprising former agents and salaried members of the Greek intelligence services, connected to business interests who worked on, at first, wrecking my public image and, later on, planning my physical demise. She added that it was her who, following specific orders, had forged the document ‘proving’ that I was on the payroll of the secret service – a document which her group then circulated to the various blogs that used it.

According to her testimony to me, a group stationed in Skopja was engaged to “see me off”. Part of the same plot concerned the defamation of another woman, a former bank manager with The Bank, who had been fired on false charges of embezzlement because, in truth, she possessed damning evidence concerning The Chairman’s family’s activities. Their plan, vis-a-vis this former bank manager was to plant narcotics in a restaurant that she owned on the island of Zakynthos and to orchestrate a very public arrest so that, in the future, if she ever revealed her evidence against The Chairman’s family, the press could dismiss her as a ‘drug dealer’. To prove her story, my interlocutor handed over a sequence of photographs that were the result of the surveillance of the former bank manager taken by «her group». The woman further claimed that she had not dared distance herself from that group but she was afraid that she would be killed upon completing her ‘tasks’.

And some depressing lols from the comments:

‘Insults even below the belt flew through the air, glasses full of water were broken while even a microphone felt also victim to extreme-right testosterone. The parliament room turned into an “American bar”, an expression Greeks use to describe a place where everybody can come and do whatever one wants. The “circus” started on Thursday after a meeting break and after Venizelos told reporters why the meeting was interrupted. Instead of speaking about some disagreements, he told reporters:

“There are tensions due to testosterone; it’s a matter of endocrinology. In any case, medical science has not concluded whether psychiatry precedes endocrinology or vice versa.”

When the meeting resumed, Ilias Kasidiaris, Golden Dawn MP, took the floor and said” I want to denounce that Mr. Venizelos speaks insultingly about the committee members… It’s you, Venizelos, lacking testosterone.”

Venizelos: I can’t follow such sexist behavior, Mr. Chairman, protect me.

Kasidiaris: I am a man; I’m not a hustler, I ‘m not a fraudster

Venizelos: But you are a fascist. The parliament cannot be in dialogue with such Nazi behaviors

Kasidiaris throws down glass full of water, breaks the microphone and beating his hand on the table

Kasidiaris: Shut up, your are ridiculous and fat

Venizelos: Mr. Chairman, protect me

Chairman to Kasidiaris: I withdraw from you the right to speak.

Kasidiaris left the meeting, Chairman Markogiannakis told reporters later, stressing “that was fascism in action.”

François Hollande, current president of the Republic, sat pillion to trysts with his mistress in the flat of a moll of a Corsican gangster killed in a shoot-out on the island last year.

http://www.lrb.co.uk/v36/n10/perry-anderson/the-italian-disaster

http://www.theguardian.com/business/2015/jan/15/currency-markets-switzerland-franc

I think the exchange rate vs the USD is now marginally worse than at the bottom of the 2005 dip. Nightmare for British companies selling to Europe.

i'm currently working in CH but spend a fair amount of time back in the UK. most other people i work with are foreign researchers, so everyone is in quite good spirits today. let's see how long it lasts...probably until our US parent company can no longer afford to pay swiss salaries.

Turns out 37% of Polish household debt is owed in CHF

http://www.economist.com/news/europe/21639760-poles-were-slow-get-out-swiss-franc-mortgages-now-they-are-paying-price-currency-risk?fsrc=scn/tw/te/bl/currencyrisk

€1.1tn QE package announced. Will be interesting to track FX rate over the next few days.

German economists at Davos are reportedly seething, understandably so.

this is the same figure commonly predicted last week

someone clever tell me why I'm feeling terrified at ireland selling bonds at negative rates

The basic idea of negative rates is that banks may have been parking their money in government bonds, even at extremely low interest rates or even at no return, rather than lend it to its own customers, such as businesses or consumers who wish to spend it. If government bonds are set at negative interest rates, those banks will be forced to pay for the privilege of parking money, creating more incentive to loan money into the economy, where it will circulate.

The main reason to be terrified is that this negative rate strategy only makes sense in an economy that is already in a deflationary spiral, or is seen to be poised on the edge of deflation. Deflation is bad, bad news in general. Money slows down or stops circulating in a deflation. People in debt are especially at risk.

http://www.lrb.co.uk/v14/n19/wynne-godley/maastricht-and-all-that

http://blogs.channel4.com/paul-mason-blog/greece-ireland-economics/3805

Then there’s agribusiness. Irish agriculture, from a country of 3 million people, produces enough to feed 50m worldwide and growing. If you look at the the profile of imports and exports from Ireland to Britain, it’s much the same via mix and per-capita GDP as the trade between the north and south of Britain. In other words – hugely controversial to say politically – Britain and Ireland are close to being a single economy with two currencies. - See more at: http://blogs.channel4.com/paul-mason-blog/greece-ireland-economics/3805#sthash.323jo1Ai.dpuf

this ending: "If you wanted to create such mayhem in an economically destroyed country, you would probably not want that country, simultaneously, to enjoy the most pro-Russian political culture in Europe, and be one border away from the Islamic State, with 42,000 Syrian migrants a month landing on its island outposts for good measure."

got that back to front

that's clearly a reference to this

In a shock escalation of the rhetoric surrounding bailout talks in Brussels, the Greek defence minister Panos Kammenos vowed: “If they strike us, we will strike them.”

European creditors told Athens to stop “wasting time” putting forward its proposals for economic reforms pledged by the new left-wing Syriza-led coalition government.

If an agreement cannot be reached, the International Monetary Fund has said it will discontinue payments on a £172 billion bailout, forcing Greece to go bust and crash out of the eurozone. Mr Kammenos said: “If they deal a blow to Greece, then they should know the the migrants will get papers to go to Berlin.”

“If Europe leaves us in the crisis, we will flood it with migrants, and it will be even worse for Berlin if in that wave of millions of economic migrants there will be some jihadists of the Islamic State too.

grexitan standoff

it's like game of thrones but isis are the dragons and golden dawn are the zombies

what a weird threat. xenophobestakes

fascism is coming

among greeks there's no love lost on the germans

Kammenos is from the right-wing anti-austerity party. Syriza were one seat from an overall majority.

http://www.theguardian.com/commentisfree/2015/jun/17/guardian-view-euro-crisis-greek-exit-would-be-europes-tragedy

http://www.theguardian.com/business/2015/jun/17/tsipras-to-meet-putin-over-bailout-loan-as-fears-of-greek-exit-from-eu-mount

http://www.theguardian.com/world/2015/jun/17/greece-says-bailout-deal-is-up-to-troika-amid-speculation-over-exit-from-eu

http://www.consilium.europa.eu/en/press/press-releases/2015/06/27-eurogroup-statement-greece/

better link: http://www.consilium.europa.eu/press-releases-pdf/2015/6/40802199986_en.pdf

yasssss

continuing austerity or the euro. tough choice for greece upcoming.

can't say the prospect a huge failure for the EU puts me in such a jovial mood. I wonder which one of the big boys will step in afterwards while the EU tells itself it did all it could

prospect of a huge failure

I'm a bright side kind of guy.

Game theory y'all:

Yanis Varoufakis ‏@yanisvaroufakis 9 Jun 2013
@WilhelmRoepke Quite. France is key. Grexit = Por-xit = Spa-xit = Ita-xit, which would then lead Germany to cut France off. Make no mistake

Wilhelm Röpke ‏@WilhelmRoepke 9 Jun 2013
@yanisvaroufakis I would not conclude that Italy needs to leave nor Spain. Both need to strive. But if there is a willingnes both can cope

Yanis Varoufakis ‏@yanisvaroufakis 9 Jun 2013
@WilhelmRoepke If Spain goes, Italy is a gonner. If Portugal leaves, Spain will follow. If Greece leaves, Portugal cannot stay. QED

http://www.lrb.co.uk/v14/n19/wynne-godley/maastricht-and-all-that

Just skip to the last para and:

What happens if a whole country – a potential ‘region’ in a fully integrated community – suffers a structural setback? So long as it is a sovereign state, it can devalue its currency. It can then trade successfully at full employment provided its people accept the necessary cut in their real incomes. With an economic and monetary union, this recourse is obviously barred, and its prospect is grave indeed unless federal budgeting arrangements are made which fulfil a redistributive role.

'greek game theory' is normally just 'bluster' afaict

making fringe right winger panos kammenos defence minister ~stirred the pot~ a little (threats to flood germany with jihadist migrants, tho I'm not sure how the already dire situation with refugees could improve if greece leaves) but that's about all they can do until there's some better offer of outside cooperation. sometimes it feels like people are just wishing greece away

Greece would've already gone if there was zero risk the floodgates wouldn't have been opened.

Podemos (and Citizens) to come, then Marine Le Pen in France as the final act. Cameron may not need to renegotiate anything at this rate, as there might not be anything left. The centre falls and a battle between the far left and right is the result - where have we had this one before?

I think that's overstating things. The Front Nationale is against the euro, but so is the Parti de Gauche. I guess that's far right versus far left, but I can't today predict how the center will unfold to those sides, if at all.

The Euro is first and foremost a political project. Greece is not central to that project.

hope they told them that when they joined

Hmmm...

Greece leaving the EU is so 50/50 to me I wouldn't even know how to handicap it

them leaving is still odds against (5/2 - 13/5) on the betting exchanges at this point of me posting... but fuck knows.

afaics, the referendum is meant to provide the government with political cover for the upcoming grexit move and absolve them from the pain and dislocation this will cause in the greek economy. it's hard to see how they could refloat the drachma while repudiating their euro debt. they might be forced to sell their souls to putin to acquire a source of ready credit. interesting times.

theory is that with a clean debt slate Greece will have access to the markets again (primary surplus and all that jazz). but God knows what a Greek 10yr bond will yield by then...

I would guess that the longer term political implications (particularly on the rest of the Balkans) of a Greek state with rising far-right presence propped up by Putin would be scary enough that all other parties would do virtually anything to avoid it. If that became a serious possibility, would the US not have a major interest in bailing Greece out?

Could Russia even afford to keep Greece afloat for any length of time?

Russia could offer an advance on Turkish Stream gas payments but it wouldn't do a great deal to resolve the crisis - at best it could delay it by a few weeks. Russian capital reserves are lower than they would like at the moment and i don't think there's much appetite for throwing vast sums at Athens.

There's also a very limited direct economic involvement in Greece, compared to Cyprus. Russia's loan to the latter was partly due to the risk to Russian money held by Cypriot banks.

i agree there will definitely be all manner of 11th hour shenanigans if exit looks likely. so many people i speak to are furious with greece, it's all about pensions to them

http://www.theguardian.com/commentisfree/2015/jun/28/greece-europe-imf-democracy

Did I miss this one?

She was offering not a solution but a narrative: the Greeks were in this situation because they were bad people. They wanted a beneficent state, but they didn’t want to pool their resources to create one. The IMF was merely the instrument of a discipline they dearly needed. This line has broadly held – the debtors are presented as morally weaker than the creditors. To give them any concessions would be to reward their laziness and selfishness. The fact that debt is a two-way street – that the returns on debt exist because of the risk that the money might be lost, and creditors have their own moral duty to accept losses when they arise – is erased by this telling of the events.

Obviously "moral duty" and a buck fifty will get you a cup of coffee (maybe).

It's worth quoting Lagarde there too:

In 2012 the head of the IMF, Christine Lagarde, said in an interview with this newspaper, “Do you know what? As far as Athens is concerned, I also think about all those people who are trying to escape tax all the time. All these people in Greece who are trying to escape tax. And I think they should also help themselves collectively.” How? “By all paying their tax.” At the time, it sounded strange: how, in a country of cripplingly high unemployment, with whole families living off the depleted income of one pensioner, was the answer going to come from tax?

The answer is that the bulk of the missing tax revenue isn't going to come from the unemployed people living off the depleted income of one pensioner - it's from the middle and upper classes who have viewed income tax as optional for 30+ years. There is a moral failure there - it just doesn't apply to all Greeks. Syriza came to power campaigning for stronger tax enforcement and currently, iirc, is negotiating for tax to be a larger proportion of the financial settlement (with the Troika pushing for reduced expectations on tax and more weight given to harsh austerity measures). Lagarde isn't really wrong - though it's incorrect (and too common) for the sins of the upper strata to be allocated to the entire nation.

It's also worth asking what the IMF and EU was doing to push for a functional tax system when it was loading debt on to Greece over the years knowing the economy was fragile.

I haven't been to Greece but I have many Greek friends in Glasgow who freely admit that huge swathes of the population have avoided paying tax for a long time. not just income tax but VAT. you can walk into most shops and get a different price if you hand over cash, bargain with any tradesman based on a cash payment etc. obviously this happens in all countries but it seems in Greece that it's part of daily life for a lot of people.

sharivari otm as far as i've read

the greek people, like the rest of europe and indeed planet, could use a better elite

of course, greek gov also creatively cooked the books for years, before joining (in order to join) & long after (though to some extent this must have been open secret)
so maybe this was inevitable; eurozone cannot hold

could use a better elite
yes

http://www.bloomberg.com/news/articles/2015-07-01/greece-s-tsipras-calls-for-no-vote-in-july-5-referendum

Syriza has indicated they will hold new elections and remove themselves from government if the country votes yes as they aren't willing to implement the package on the table.

That said, it's not clear what package is on the table at the moment and there has been talk of them compromising on a number of key issues today.

anyone understand what syriza are playing at right now?

I don't think anyone truly does, including many of the participants - exciting times..

they are grasping at straws

the concept that syriza have ever had a plan for anything beyond scweaming and scweaming until the facts change seems to me to have come from nowhere at all.

to pretend it wasn't always going to end like this seems to me to have necessitated a serious amount of self-delusion

to attempt to balance blame equally or even close to equally between international creditors and this bunch of feckless clowns seems to me to be leftist experimental economics fanboy whatiffery of the worst sort.

it's speculative to say that syriza drove this exactly as they always intended to- public self-immolation as protest statement writ large- but imo its equally hard to argue that their chosen course throughout was going to lead them anywhere else.

sucks to be greece, sad for the lot of them alright. vote better next time, shit matters.

Which begs the question where do you think they'd be if they had voted for someone else?

The position of the Greek left, and as far as it looks, the majority of Greeks is that the national debt could not realistically be serviced under any of the suggested schemes - a position apparently backed up by the IMF's own reports. Their objective has always been to get debt relief or debt restructuring and to ensure that any measures implemented to service the interest didn't disproportionately affect pensioners who have already been targeted during the last three years of austerity.

I'm not sure what a "good" result under another government would look like.

Deems you left the phrase 'sixth-form' out of your rant, I'm very disappointed.

the Syriza government's negotiating tactics have hardly been perfect, but then they are being crucified by the Troika, the German government and various other powerful international actors. I fail to see how a more right-wing government could have done any better for Greece- in fact such a government would have swallowed the disgraceful austerity measures that have been thrust upon them with far less of an attempt at negotiation in the interests of ordinary Greeks.

Don't think they are grasping at straws at all. And they aren't down-and-out. This is a long game, even if they lose the elections their support has held up well, they have been straight with people and they haven't buckled. Even now they have 'accepted' a lot of it but the referendum is going ahead. They've played their hand really well.

Its actually been a p/good week - the IMF have been dented by the loss of money. No one will look good but its all about degrees.

Spain and then France are coming up (and Sinn Fein too ;-)). And in Greece it could be decades before they pay any of these debts back - so this isn't sustainable.

Feels like its just the beginning.

fpd u and u know very well why

:-)

"what would you do if you were greece?" is a fun question to ask ppl ime/a good way of eliciting latent cluelessness

greece is the word lol

It's worth remembering with all the comparisons to Ireland that there are some crucial differences between the two. Irish GDP per capita is about 200% of Greece's and debt as a percentage of GDP has always been much lower. Ireland's was something like 115% during the 2012 crisis - Greece's is currently 177%.

Also worth bearing in mind that Ireland has not paid back any of the debt - it's just servicing the interest. The proportion of debt to GDP rose in 2013 and 2014, iirrc, and the actual cash amount is projected to increase slowly over the next five years. It's only going to decrease as a % of GDP to manageable levels because the economy is supposedly going to grow fairly quickly as well. Syriza's argument is that an overly harsh programme of cuts is going to stifle the economy and prevent that kind of growth happening in Greece.

http://blogs.channel4.com/paul-mason-blog/greece-ireland-economics/3805

varoufakis is enjoying himself too much throughout

oh I don't know

Tsipras always tells his guys in the dressing room, just go out and enjoy yourselves

Interesting update from the IMF:

http://www.theguardian.com/business/2015/jul/02/imf-greece-needs-extra-50bn-euros

Nothing is viable without long-term debt restructuring and immediate debt relief, which is more or less what Syriza is after.

astonishing, really

they've just done the EU/ECB

xp leftist experimental economics fanboy whatiffery of the worst sort imo

reported by the Guardian tbf

Is the Guardian better than it used to be?

Imagine being one of the poor saps in the room when Angela Merkel read that statement.

(Trying not to mention Bruno Ganz in "Downfall" here)

Given what Lagarde was saying earlier this week this isn't going to be without a number of big Greek concessions, a number of which are going to be anathema to Syriza, but then again it is the IMF.

would love to have seen schauble's face

More from the IMF report, too hard to report so I am going to click in The Guardian instead: http://www.imf.org/external/pubs/cat/longres.aspx?sk=43044

too hard to read, ugh.

there was a good summary on FT Alphaville. some synthesis:
- it shifts part of the blame to prev. and current Greek government (no ambition to hit primary surplus targets, no commitment to privatization or reforms). market interest rates were low, so if program had been implemented we would be in a pretty good shape.
- it offered a politically feasible (well, up until last Friday) solution, namely doubling of maturities (would have been very easy to accomplish) and adding a sizable 3rd bailout, without imposing haircuts.
- no more "systemic exception" for Greece
- time to stop talking about debt/GDP ratios, since loans are on very sweet ("extraordinarily concessional") terms
- haircuts phrased in very careful way: needed *if* primary surplus of ~3% of GDP not hit, but not needed if it gets to 3-4% over medium term. this is dangerous territory: aiming for low surpluses = not requiring future governments to impose any austerity measures = "moral hazard". aiming for high surpluses is probably delusional?
anyway, the numbers are probably pretty worthless since last week? how many billions would be needed to recapitalize the banks, clear arrears etc.?

"moral hazard" lol

http://www.interfluidity.com/v2/5965.html?utm_source=dlvr.it&utm_medium=twitter

http://www.nytimes.com/2015/06/30/world/europe/greeces-troubles-attract-little-sympathy-from-poorer-neighbors.html

Good news then that they'll soon be poorer than Bulgarians, well done Europe! Trebles all round!

Speaking in Brussels last week before the start of a European Union summit meeting, Prime Minister Boiko Borisov of Bulgaria complained that he was fed up with so much time being spent on Greece’s need for bailout funds to pay its bills when other countries had so many problems of their own.

Problems like having Boiko Borisov as Prime Minister perhaps?

"Soviet-imposed penury" is an interesting interpretation of the Baltic states' financial worries.

The Latvian government was struggling to avert a financial meltdown today as ministers convened emergency talks with Scandinavian banks to discuss a bold and controversial plan to slash mortgage-holders' liabilities to lenders.

The scheme could mean billions in losses for the big Swedish banks most exposed by the small Baltic state's financial and economic crisis.

Valdis Dombrovskis, the embattled Latvian prime minister, said he was confident he could get his proposal through the parliament in Riga, but was still examining the legal implications of the scheme. But the powerful Latvian central bank delivered an unusually blunt attack on the prime minister, saying that his budget and bank policies were feeding a fresh "wave of distrust" towards the small and highly vulnerable state.

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Banking sources in Riga warned that the radical proposal on mortgages, which could see borrowers repaying only a fraction of their loan, would backfire, deterring foreign investment, bringing already low bank lending to a complete standstill and wrecking international confidence in Latvia.

Dombrovskis said the foreign banks, which hold controlling stakes over 90% of the Latvian banking sector, shared the blame for the crisis and would also have to share the costs. "Some balance has to be found between the interests of borrowers and the interests of lenders," the prime minister told the Guardian. "The real incomes of people are diminishing and it is getting more difficult to repay loans."

From 2009. Wonder what happened to that Dombrovskis guy...

http://i.imgur.com/mA8xYBk.png

^ Soviet-imposed penury in action.

early returns have it at 60:40 no

Pretty decisive.

didn't expect that tbh

decisive > indecisive no matter which way it went imo

http://www.ekathimerini.com/198826/article/ekathimerini/news/declaration-of-professors-of-economics-at-greek-universities-on-the-referendum

Better luck next time, guys.

i don't know what to make of all this. the referendum was a hypothetical counterfactual: if this offer were still on the table, would you have liked for us to vote for it? like.. what? now the answer is "no," well what does that mean? it's a mandate to not accept a deal that they didn't accept that is no longer on offer. tsipras is counting on them getting offered a better deal with these results, varoufakis promised one within 24 hours if the result was "no" (although he conveniently claimed to have been misquoted after the results were in.) maybe that will happen, but if so it would be marginally better, nothing radically different. does "no" mean "yes to a marginally better deal"?

even experts seem to be saying "no one knows what's going on, the next few days will be an insane shit show, hopefully everything snaps into place"

i'm not sure the narrative of rejecting austerity some ppl who are currently rejoicing are pushing is apt. there will likely be brutal austerity now... from the link mordy posted above

Short-run consequences: Bank closures, cut in the value of deposits, sharp decline in tourism, shortages of basic consumer goods and raw materials, black market, hyperinflation, firm bankruptcies and a big rise in unemployment, rapid fall in real wages and the real value of pensions, deep recession and serious problems in the functioning of public health care and defense, social unrest.

Medium-term consequences: international isolation of the country, no access to international capital markets for several years, low growth and anemic investment, high unemployment combined with high inflation rates, suspension of the flow of EU structural funds, significant decline in the standard of living, poor provision of basic public goods and services.

as irresistible as a narrative of the people against the banks may be, what are the pros will be to offset these cons, all of which have severe human costs? anyone needs to answer that before celebrating

The victory celebrations are like "yay, we just voted against paying off our debt and there will be no consequences!" - ok, I don't think foreclosing the Parthenon is on the table, but still

paul mccartney / big bankers who got 90% of the IMF's greek bailout money ~

I remember making a very conscious choice: “OK, we’re getting really famous now, you’ve got to decide, whether or not to go for it.” For some reason Marilyn Monroe came into my mind. Like: this could be horrible. It was actually after a trip to Greece. We weren’t famous in Greece, and I’d hung out with the hotel band and was chatting to them: “I’m in a band, too, you know? We’re called The Beatles.” And I got a glazed look from them. I thought, “This is OK, if the fame gets too much we can always come to Greece.” Then, of course, the next year it was like, “Oh, no, you’re famous in Greece, too. Oh, God.” And I remember thinking, “Do you want to do this or don’t you?” And it was, “I like it too much to stop.”

http://www.esquire.co.uk/culture/music/8511/paul-mccartney-interview/

tsipras is counting on them getting offered a better deal with these results... maybe that will happen, but if so it would be marginally better, nothing radically different.

Well, he was counting on them getting offered a better deal with a simple 'No' majority but the margin is 20% (and seems to be rising) so I imagine he'll be looking for something more than marginally better.

i guess we'll find out

When Iceland voted against paying what they owed, they came out of it really well. Yeah, this is going to be fucking tough on the Greeks, but at leat it will be tough on their own terms. Short term and middle term will be rough, but the bullshit provisions french and german banks kept getting in these deals would have kept the suffering eternity-termed. So yay Greece!

greece != iceland

the referendum was a hypothetical counterfactual: if this offer were still on the table, would you have liked for us to vote for it?

This is about strengthening his government's position in the country more than it's about strengthening the government's hand in the negotiations.

The central bank and IMF were no doubt curious to see if the greeks would repudiate their government, which would have strengthened their own hand in dealing with that government, but with the greeks backing tsipras it either solidifies the stalemate and leads to default and grexit, or the bankers must make concessions to break the stalemate. Either way, tsipras stays in power now and has political cover for the national consequences of the outcome - whatever it is.

And whatever happens, it must happen pretty quickly. I hope the greek parliament is primed for quickly passing the kind of currency controls needed under grexit.

The risk is that German public / political opinion has become too entrenched for any substantially better offer to happen. Leading politicians across Europe, but particularly Germany, are framing this as a rejection of an offer of help and suggesting there can't be any way back to negotiations. There's a chance that the risk inherent in having Greece leave with popular momentum behind it might be too great for the wider European project to bear but the deals on the table were never about finding workable, pragmatic solutions. That political culture isn't going to change overnight because the Greek public wants it to.

otm

French resolve is wobbling though? If not, I expect it to.

France has always been open to a better deal, i think.

french not enough though

This is about strengthening his government's position in the country more than it's about strengthening the government's hand in the negotiations.

Either way, tsipras stays in power now and has political cover for the national consequences of the outcome - whatever it is.

otm
imf/cental bank aren't accountable to or obligated by greek vote

what's the current take on whether Greece will (have to) leave the EU as well?
and will they stay in the Schengen zone?
thinking about hot new airport chaos if they're gone from the Schengen zone (can't imagine Spanish tour properties would be unhappy with that)

echoing shari's last point

https://pbs.twimg.com/media/CJLMeV-WgAAcCcf.jpg

Le Monde's take : this is a defeat for Merkel and Germany, and her vision of a German Europe.

Varoufakis may sound delusional in that statement, but it's his job not to slam the door on reopening negotiations right now, even if it means sounding foolish. I give it about two, maybe three days before everyone realizes it's game over. First, the markets have to open and have their say. Losses need to be in a non-panic-inducing range. I expect they will be modest.

i would be curious what the result would have been if this had been a eurozone/eu-wide poll

'Not tough enough on those damn lazy greeks!!!!' Would be my guess.

if the answer is to have wealthier european countries subsidize poorer european countries then europe is going to have to become a lot more like the US. some ppl here complain about NY sending so much money to Alabama or whatever down south but it's not a real political stream.

The risk is that German public / political opinion has become too entrenched for any substantially better offer to happen.

the fact that this is now a decisive factor is one of the increasingly evident straining points in the architecture of the eu. fiscal union is at the avant garde of further EU integration, and at the moment, as it is threatened, there just doesn't seem to be the imagination to try to find a solution that isn't a retreat. if greece leaves I don't see how it could reenter, it jeopardizes the whole nature of serious political union. but it still seems incredible to imagine them leaving. if there are still followers of jean monnet in the eu, you would hope they would copy his methods and seize the crisis as the moment to open the discussion on reform. otherwise this is treated as an isolated problem when it clearly isn't.

"if greece leaves I don't see how it could reenter, it jeopardizes the whole nature of serious political union"

yeah I don't see this. the political union is to make sure that Germany and France don't declare war on each other anymore, and to a lesser but still important extent, on their immediate neighbors. *fiscal* union is there to serve that political end.

the political union is to make sure that Germany and France don't declare war on each other anymore

europe is so weird

Old habits are hard to break

An unnamed but apparently "senior and influential" German politician was quoted in The Times as saying that the CDU and CSU had privately agreed to veto any deal proposed while Syriza was still in office in the event of a no vote.

The risk of 'contagion' seems pretty high to me. If Greece goes, i could see Portugal, Spain and maybe Italy following over the next few years unless there is some kind of miraculous upturn in the global economy. Already in Italy, the 2nd, 3rd and 4th biggest parties have been actively cheering on a 'no' vote. Podemos seems to have been emboldened by it as well. The Greek exit from the Euro will either have to be soft enough for other countries to be able to leave the currency without compromising their membership of the EU or so appalling that everyone is scared back into line.

Tusk has called an emergency meeting for Tuesday.

the political union is to make sure that Germany and France don't declare war on each other anymore, and to a lesser but still important extent, on their immediate neighbors.

there has always been a much more ambitious vision of european integration than this, otherwise we'd have stopped at the coal&steel community (& nato)

this is crazy

https://pbs.twimg.com/media/CJLm3xMWEAACqif.jpg

do you want more of whatever that is or less of it

(xp) Yeah, for the economically illiterate (me) could you explain what that means... also I see Ireland1 on that graph but where how are Ireland2 doing?

between the hellenic republic ("greece", to the obtuse imperialists), spain, italy, and portugal, perhaps there is political will for a southern european union. a confederacy, if you will

This is a guess, but I think the graph shows how much of a country's theoretical gdp-growth would become a surplus? So a country like Greece is already amazingly austere compared to rest of Europe, but since it's in an IMF-mandated gdp recession, they get nothing out of it.

Is that close to correct?

silby: less

primary surplus is just gov revenue minus gov expenditure expressed as a % of gdp. "cyclically adjusted" means you adjust for the business cycle, basically saying "what would the primary surplus be if the economy were at full employment?" (which is pretty non-trivial and that's why smart people at the IMF compute tables like that--btw IMF research economists & bankers are m/l independent, that's why you've seen all these headlines saying "new IMF research show austerity doesn't work" but fruitless negotiations) so in 2014 the greek government raised 5% of "potential" gdp in taxes that it didn't spend. here's a picture with both

http://www.ispionline.it/FOTO/grecia_fig1.png

the cyclically adjusted thing sounds like a weird trick but it's necessary bc otherwise countries in recessions would have low govt revenue simply because their output is (temporarily) low, even though it would even out over the business cycle

so greece is the most fiscally conservative country in europe lol

There are a lot of people on social media hailing this as a "victory for democracy" while conveniently not thinking about what would happen if the German public held a referendum on the issue tomorrow.

"When Iceland voted against paying what they owed, they came out of it really well"

my God

sv otm about the two ways this will go, and there's far more govts in power with a serious vested interest in terrifying the voters with the Greek example before the next round of elections. can only see this being a massacre, and a quick one. no vote only makes it an easier sell to the mass european electorate that the Greeks were complicit at every stage tbh.

There are a lot of people on social media hailing this as a "victory for democracy" while conveniently not thinking about what would happen if the German public held a referendum on the issue tomorrow.

― Matt DC, Sunday, July 5, 2015 6:47 PM (5 minutes ago) Bookmark Flag Post Permalink

yup. that's why monetary unions are... awkward. lots of really basic bad analysis going around on both sides, it's crazy how many people there are on both sides who see this purely as a moral good vs evil thing (lazy greeks getting what they deserve on the right/righteous democrats sticking it to evil banks on the left)

If Germany held a referendum tomorroe they would have to admit they are working in their own interests, instead of out of economic logic and nescessity. Which would be a plus for democracy as well.

Greece has chosen, and they've chosen suffering. But they were suffering already, and with no end in sight.

how to make a drachma out of a crisis

Dying on yr knees or, errrrr, not on yr knees, on yr feet I suppose.

I'm all for countrywide 'fuck you' gestures at the stage where hope has long since gone, Sparta is gonna be a p apt comparison tbf

But I guess my response would be pretty differintly if the imf way hadn't alreay tried and failed. And if greece wasn't already the most austere country in Europe. Etc.

does this mean the Greeks return to worshiping the gods of Olympus

lots of american expertise itt

doesn't seem so democratic now

But I guess my response would be pretty differintly if the imf way hadn't alreay tried and failed.

I think Greece's would be too. The EU / IMF only seems to have one setting - the answer is austerity. If that fails, the answer is more austerity. If that fails the answer is more austerity, etc. Which might be excusable from a technocratic perspective if it wasn't trashing the Greek economy and reducing the country's long-term ability to pay its debts, in addition to its short-term ability to provide food, shelter and medical care.

Probably sensible for Varoufakis to step aside if Germany is flat-out refusing to consider any proposals he makes.

putting that backwards a bit, no?

Probably sensible for Germany to refuse to consider any proposals Varoufakis makes if he is no longer finance minister?

The FTMIB seems to have been worst hit this morning but the markets / Euro haven't plummeted so far.

well this referendum wasn't hugely relevant in a lot of ways tbf

The no-austerity posture would be more credible if Tspiras wasn't so reluctant to tackle the fiscal elephant in the room, namely the largely tax-exempt crazy-rich shipowners

fighting a war on two fronts is always a bad idea

I guess that's whay they won't consider cutting their insanely high military budget either

Lol doesn't like a quarter of their arms spending go straight to Germany?

I don't know how much they can practically do. Tonnage tax is one thing that could be addressed but the internationalisation of both shipping and Greek money more generally makes going after people with a wealth tax hard. Most extreme wealth, as far as i can tell, isn't tied to land value - which can be taxed fairly easily, it's complex assets that can be moved off to Cyprus, Malta, etc. Most "Greek" shipping companies aren't registered in Greece - the fleets are tied to a P.O box in Liberia, etc.

The wealth tax that was introduced, Enfia, disproportionately hit low and middle-income families who had a bit of farming land left to them, and so on.

Aside from the practical elements, there's an underlying danger that efforts to really crack down on the relatively wealthy could have unintended political consequences. The far-right isn't getting its money from thin air and "fighting a war on two fronts" might not be far from the truth.

yeah, telling SYRIZA they should be taxing shipping magnates more is a bit 'don't piss on me and tell me it's raining'. Like as if the EU and all other institutions of global economic governance weren't ferociously committed to making transnational capital flows as smooth and easy as possible.

anyway, stoked 4 the thinkpieces

Didn't the counter-offer from Syriza involve more taxes on the rich to offset austerity a bit, and wasn't that shot down by the trojka?

Yes, there was an understanding that taxes would be raised to some extent and, probably more crucially, enforcement would be better.

I'm not sure if the Troika gave a breakdown of why it was rejected but most of the commentary has been that enforcing higher taxes would lead to more capital flight and revenue targets via taxation were too ambitious to be realistic, so the only reliable way to pay the interest would be through a raid on pensions and vasts amounts of privatisation (selling Pireaus, etc). I've seen quite a few pieces that have argued taxes should be lowered to encourage more people to pay them, which is optimistic.

I had nice Greek food for lunch in Berlin today fwiw

enjoy it while you still can!

RIP

there'll still be Bulgarian feta

translated interview w/ piketty:
https://medium.com/@gavinschalliol/thomas-piketty-germany-has-never-repaid-7b5e7add6fff

oh shit i just noticed he took down the translation. bummer - original here:
http://www.zeit.de/2015/26/thomas-piketty-schulden-griechenland/komplettansicht

Piketty: When I hear the Germans now say that they maintain a very moral dealing with debt and firmly believe that debts must be repaid, then I think: That's a big joke! Germany is the country that has never paid its debts.

They won't like that... from a Frenchman.

yeah was gonna post that but then the translation disappeared

It seems laughable that European countries coudl ever work together on anything other than techno music

So basically we need a techno "We Are the World."

But not in German.

https://web.archive.org/web/20150706021012/https://medium.com/@gavinschalliol/thomas-piketty-germany-has-never-repaid-7b5e7add6fff

a bunch of zingers in there:

ZEIT: Many Germans believe that the Greeks still have not recognized their mistakes and want to continue their free-spending ways.

Piketty: If we had told you Germans in the 1950s that you have not properly recognized your failures, you would still be repaying your debts. Luckily, we were more intelligent than that.

Damn! That Piketty interview is hard hitting stuff. Not only is Piketty right, but he is so obviously right it made me wince. Thanks.

So basically we need a techno "We Are the World."

Wow, there are a lot of techno versions of Ode To Joy... http://www.youtube.com/results?search_query=techno+ode+to+joy

varoufakis was hot

https://www.youtube.com/watch?v=lyNMZxyVVpA

he still is!

"In his home country, a new word was coined - "Varoufitses" - to describe women who idolise Mr Varoufakis."

he looks a bit like Paulo Di Canio

he is a horrible writer

Paoulo?

yeah that fucker as well, but you have also spelt it wrong!

FU

picketty is right. fuck germany

http://www.newstatesman.com/politics/2015/07/Slavoj-Zizek-greece-chance-europe-awaken

Yeah Piketty made my change my stance on this - basically arguing people to see the big picture here. It'll take a hell of a politician to take the high road on this (cf. his quote on Kohl) and I'm not sure we've got one of those in the current crop.

i mean greece has been acting stupid for years, don't get me wrong. and the eurozone should probably tighten their commitment to unification and have an inter-nation tax collection agency so crazy greeks pay their taxes. but seriously germany, suck it up

I think there's a good chapter on debt history in Pikkety's book. Read it recently, but this goes to show how thorough. It's a very good book, though.

euclid tsakalatos = best name ever

http://nymag.com/daily/intelligencer/2015/07/greece-comes-to-emergency-summit-empty-handed.html

boom tsakalatos

eurozone just dropped the hammer

I did a higher level course in economics but I have to admit that ultimately I do not have a clue what's going on. Even to the point that I'm like "what is this debt?" Or even "what is money any more?" I mean I love that Picketty interview because it's fearless, I want to believe. But wtf is going on? I feel so stupid when I read about it.

good op-ed from a Greek friend of mine:

http://www.euractiv.com/sections/eu-priorities-2020/search-vision-europe-316063

so the chinese stock market crashed today. i'm sure these are isolated incidents

Or even "what is money any more?"

srsly

China has its own economic issues that don't hinge on Greek debt

re "what is money any more?" i feel like that's the least confusing bit about all of this. Greece doesn't have a sovereign currency so they can't do any of the things a country might normally do to restart their economy.

no one said anything about hinging. but a stable european market helps not hurts the chinese market

from what i understand european markets have been relatively stable throughout this ordeal

nah i think mordy's right, china just had a big bubble

not saying the bubble popped because germany might be pushing greece out of the european union. (if they do, that might be a real ordeal.) the specter of european chaos doesn't help, is what i'm saying -- which is one of the reasons europe united in the first place, if i'm remembering correctly

World markets were hit on Wednesday by a meltdown in Chinese markets, a slump in commodities and questions over whether Europe could save Greece.

European trading got off to a steady start, even though stocks had plunged 6.75 percent in China .CSI300, where the country's regulator warned investors were being gripped by "panic sentiment".

That put all of Asia into a tailspin. Hong Kong .HSI dropped 8 percent, and Japan's Nikkei .N225 and stocks in Australia .AXJO took heavy blows, leaving investors only the yen JPY= and safe-haven government bonds for refuge. The yen rose to a six-week high against the dollar.

i don't get that Greece is enough of a player in the world economy that it really matters - the concerns are more things like whether a Grexit will lead to a idk Spexit or Itexit or whatever, then actual ripples from Greece itself (and I wonder if a lot of that risk has already been built into the market - how much the EU will really suffer at this pt if the Grexit happens)

Burningmoney.gif

from NYT:

Europe is in “limbo and despair” as it awaits the next episode in the Greek crisis, said Carsten Brzeski, an economist in Frankfurt with ING-DiBa.

“It’s like the movie ‘Groundhog Day,’ ” Mr. Brzeski said. “We wake up from yet another Eurogroup emergency meeting on Greece, and the world still looks exactly the same.”

“Our base case is still a ‘Eurofudge,’ ” Mr. Brzeski said, with a slightly better than 50 percent probability that “they’ll find some kind of a deal.”

I love how "Eurofudge" is an actual term people throw around

again, not alleging causation, much less even relationship (as with the chinese market crashing), but today the NYSE stopped functioning

http://www.dailymail.co.uk/news/article-3153716/New-York-Stock-Exchange-halts-trading.html

"The outage came amid a flurry of other technical issues across the business world on Wednesday.

"Earlier in the day, United Airlines temporarily grounded all planes worldwide over a 'network connectivity issue.' About 4,900 flights were affected.

"By noon, The Wall Street Journal's homepage had crashed. A 504 error message displayed when visitors attempted to reach WSJ.com."

apollo is angry!

from what i understand european markets have been relatively stable throughout this ordeal

market behavior is predictive, not reliably so, because predicting the future is never reliable, but it is based on investors' guesses about the future, and crashes are generated out of fears for the future.

who knows what the chinese market fears atm, other than losing money, but a jittery market can be pushed over the edge by almost anything. it doesn't even matter if the fears are well grounded in reality, because a crash generates its own reality just as a bubble does in the opposite direction.

So Tsipras has capitulated on basically everything then? What a victory for democracy.

a victory for market finance capitalism is a victory for democracy! nai!

for realz germans should respond to this peace gesture by lowering interest rates, like picketty says. tempura mutantur et nos mutamur in illis

can't believe them voting their debt away didnt work, crashing blow for democracy

Will help to keep them in power though, I imagine.

... which will annoy the Troika, so compensatory LOLz there. Anyway, this been heavily spun as a capitulation and I'm not sure whether it is or not, too complicated for me.

Ultimately their "choice" was austerity as directed by the troika vs the even greater austerity required for when they ran completely out of money and their banking system collapsed and not even the most foolhardy of governments would plump for the latter.

what a great democracy! do you want to stay in the eurozone? circle one. yes / no yes

so I guess the lesson is sovereign debt stops working when you have a non-sovereign currency

germany laid waste to europe 70 years ago, which i guess is irrelevant when everyone but the greeks recovered fast enough for the german banks from the 2008 bush/cheney crash

^^^ also that sovereignty stops working when you have a non-sovereign currency xp

also that finance is a game of musical chairs, and the smallest countries lose

if the greeks exit the european zone, they should sue for a trillion dollars for the rights back to the continent name they came up. the former european zone can call themselves prussia or the holy german empire

yeah you should stop with the German/ww2/prussia shit its pretty dumb

what do you call a europe without greece then?

http://forward.com/workspace/assets/images/articles/w-nazimustache.jpg.jpg

LOL!!!!!!!

what do you call a europe without greece then?

I don't know what you mean, they're not going anywhere.

Ultimately their "choice" was austerity as directed by the troika vs the even greater austerity required for when they ran completely out of money and their banking system collapsed and not even the most foolhardy of governments would plump for the latter.

― Matt DC, Friday, 10 July 2015 15:05 (40 minutes ago) Bookmark Flag Post Permalink

what a great democracy! do you want to stay in the eurozone? circle one. yes / no yes

― Mordy, Friday, 10 July 2015 15:23 (22 minutes ago) Bookmark Flag Post Permalink

matt: this was always the choice, syriza pretending otherwise was their great sin in all this imo

mordy: that referendum was asking a question that p much didn't have a real-life scenario attached, idk if there's any point even acknowledging it happened.

syriza has a major point about the banks lowering their interest rates on greek debt

matt: this was always the choice, syriza pretending otherwise was their great sin in all this imo

KKE otm

yeah you should stop with the German/ww2/prussia shit its pretty dumb

didn't work out well 4 them it's true- also they ran up a load of debts

pay up, you lazy greeks!

The euro climbed to a one-week high against the yen of 137.27 yen and was last at 136.99, up 2.4 percent. The euro zone common currency was on track for its largest one-day gain since April 2013. Against the dollar, the euro was up 1.2 percent at $1.1167. MSCI's all-country equities world index jumped 1.3 percent. The Dow Jones industrial average rose 171 points, or 0.97 percent, to 17,719.62, the S&P 500 gained 20.37 points, or 0.99 percent, to 2,071.68 and the Nasdaq Composite added 58.10 points, or 1.18 percent, to 4,980.50. European shares were up 1.8 percent.

http://www.reuters.com/article/2015/07/10/us-markets-global-idUSKCN0PJ2ZW20150710

Chinese stocks were also buoyed by a raft of support measures from Beijing that appeared to calm investors. Panic selling had slashed a third of the value off mainland markets since its peak in June. China's worries have spread to other markets, with iron ore the hardest-hit industrial commodity and oil prices also hit.

I wonder at what point Tsipras accepted he would have to cave. There are rumours he was hoping the lose the referendum so as to have an "honourable" way out.

I think the referendum was a bargaining tool to scare Merkel et al into giving into their demands but they called their bluff. Still, some debt restructuring, right?

The idea that it was possible to proceed on austerity alone without investors making any concessions on debt restructuring was a wrongheaded notion from the first. There was brinksmanship on both sides, but when your position is as strong as the troika, employing brinksmanship just to gratify your sense of moral superiority is kind of like playing internet hardman with an entire country. Greece's brinksmanship was at least more defensible, because they really are standing on a brink.

they called their bluff

yup

employing brinksmanship just to gratify your sense of moral superiority

don't think this is quite or entirely accurate characterization of troika's considerations/ calculations here

morality aside, for one thing, there was potential that greece might set precedent for other countries to follow-- big reason why i've felt imf/eu would/could not make anything other than minimal concessions (if any) in response to greece's desperate gambit

^^^ Is exactly what this is about, deterring other countries from electing far-left governments - any substantial concessions to Syriza would effectively have rubber-stamped an enormous redistribution of money from northern European countries to southern ones. Northern European countries that appear to only be in favour of greater political union when it suits them.

I don't think this will deter people from electing Podemos or other parties on anti-austerity tickets such as Sinn Fein, and Syriza are still there - ultimately Tsipras is being a politician and this is still a long game.

Existentially long game

If the troika was concerned before about Greece potentially dragging their feet and not implementing the 'necessary structural reforms', well, now the government has a clear democratic mandate to drag their feet and not implement reforms.

That's all very well but barring a complete 180 in German or Greek public opinion there's no plausible end to this crisis that doesn't involve one government or another going against the democratic will of its people. And I have a feeling it's unlikely to be the guys with the money.

Major debt relief and another bailout would be both the morally and pragmatically correct thing to do but how is that going to happen with the German public so vociferously opposed? Could any other institution do more here? Serious question.

Markets distort democracy even during good times by effectively allowing governments to opt out of unpopular tax and/or spending decisions, until suddenly they can't any more. I can't remember any example of a government consulting the electorate on borrowing or making it an electoral issue during a boom.

Not that the Greece accepting every troika demand and accepting another bailout is going to get anywhere near ending the crisis, but whatever.

for those on the edge, the EU is not a v attractive proposition atm. i wonder how this will effect the UK referendum, it doesnt change anything for the eurosceptic right, it will harden the eurosceptic left, but lots of those in favour of further EU integration will have lost faith in the current set up & culture. otoh never underestimate the british publics ability to endorse the status quo

Britain is kind of a special case due to not being in the Eurozone though? I'm not sure the Eurosceptic left is really a big enough contingent to make much of a difference either way, although it must be growing.

My guess is enough of the undecideds will vote to stay in when faced with the possibility of their jobs abruptly disappearing.

the special cases are what's interesting though, the EU hasn't handled its periphery well lately. if it has ambitions of expanding either the EU or monetary union it's not obvious how it intends to do it

after the last 12 months how any leftist can not be sceptical of the EU beyond it's cuddly wuddly brotherhood of nations shtick and easier access to Tuscan holidays, god only knows

skepticism (or a bit different, critical awareness) is one thing, but EU integration isn't just a schtick in academic circles: lots of research, multinational degree programs, faculty mobility etc benefit from EU integration. and we are generally on the left, but not so far on the left that rhetoric merges with the FN e.g. (which you see in the left here at times)

yeah i recognize it's more complex than my own shtick acknowledged, but it's still been made pretty clear now exactly what kind of economic ideology commitment to the EU is to entail

I mean as someone newly hitching his post to the EU from Amerikkka I realize my views are suspect : but : nations considering entering the Eurozone might consider calling referenda on this membership, without their populaces having any real idea of the consequences. would Greeks have voted for Euro adoption in 2000? would that have been used against Greece now? I don't know what to make of the relation between democracy and the economics of the EU.

Greeks wanted the advantages of the Euro so they doctored their books to get allowed in. Which was bound to bite someone in the ass sooner or later. (how true or exceptional this is among Euro member states, I don't know, but it's brought up often re:current situation)

Eurozone member nations helped them cook the books though

the pensioners weren't the ones who doctored the books though. the idea of financial "discipline" for the working class is gross. even more so is the fact that it's being imposed on a sovereign nation against its will.

i understand why tsipras is caving to the creditors' demands. exiting the euro and not receiving a bailout wasn't a real option for a politician who cares about the immediate well-being of his people. still, it's tragic.

http://www.spiegel.de/international/europe/greek-debt-crisis-how-goldman-sachs-helped-greece-to-mask-its-true-debt-a-676634.html

goldman sachs bankers can buy greek islands now even cheaper than before. who cares if greek kids can't find any work? it's their own damn fault!

germany has reportedly drawn up a paper suggesting greece could temporarily exit the eurozone.

eh?

In out in out shake it all about

Bitcoin to the rescue

Sort of feel that the EU is only ever as good as its constituent governments and there are some pretty repellant ones in power in key nations right now, although France and Italy look like they're privately if not yet publicly clashing with Germany over Greece right now.

Temporary Grexit is the stupidest back of a fag packet idea I've seen yet BTW.

That's all very well but barring a complete 180 in German or Greek public opinion there's no plausible end to this crisis that doesn't involve one government or another going against the democratic will of its people. And I have a feeling it's unlikely to be the guys with the money.

well, the ones with the money are also the ones with greatest contempt for democratic will of people, so you could flip that round and say it's the guys with the money who will eventually say fuck it. I do actually think 'popular outrage' against spendthrift greeks is a largely elite created phenomenon which could be easily reined in by those same elites if they thought it convenient. It's basically a small country having sovereign debt problems- who in Germany would really care, left to themselves? It's astroturfing.

i feel like you have to make a kind of 'false consciousness,' what's the matter with kansas type argument to believe that non-upper class nativism / protectionism / anti-immigrant sentiment / whatever is astroturfed and not sincere. ppl w/out a whole lot are very protective about what they do have and i think sincerely are afraid of foreigners trying to take it.

i'm like more inclined to think that elites and the public are both neurologically hardwired to think of some ppl as their landsman and others as strangers + resent the latter. obv i don't think this sentiment is in any way positive. considering that the whole euro project is predicated on this idea of europeans as having a shared identity + vision of the future this whole crisis would be a better opportunity to try and smooth those borders.

mmm, yes, I'm not keen on false-consciousness type arguments in general. I do think though that this is an issue which would never have gained popular momentum in the first place, had the whole issue been kept by the relevant governments at a dry, technocratic level: within-eurozone transfers are required between core and peripheral nations in order to secure the stability of the currency- that sort of thing. Instead, they insisted on making it about nation(s) vs nation, and rubbed the lamp of nativism / protectionism, the othering of outsiders, the closing ranks around ones landsmen, all that stuff that you're quite correct about. They had the choice, and emphatically rejected the opportunity to try and smooth the borders, to strengthen the idea of a European shared identity.

I don't think this will deter people from electing Podemos or other parties on anti-austerity tickets such as Sinn Fein, and Syriza are still there - ultimately Tsipras is being a politician and this is still a long game.
― xyzzzz__, Saturday, 11 July 2015 09:11 (Yesterday) Bookmark Flag Post Permalink

it will hurt sf imo

and rightly so. and for the better.

Depends on how it goes for Greece - what degrees of bad and who that is seen to be caused by.

At the mo its looking like (i) Eurozone splits mean Greece get kicked as they don't trust Syriza to implement but actually (ii) if Euro does approve bailout Syriza could fall apart within months, meaning greeks will get the centrist pap that has dominated Euro politics for most of my lifetime.

If Greece are kicked that could (i) teach Spain and France a lesson if its public go the wrong way in the polls or (ii) be the first step in finishing Europe, or large parts of the Euro project.

Like to think they'll approve but bullets in Sarajevo etc.

is this a coup?

Is the Euro (as opposed to the EU itself) even worth saving at this point?

for all of the stereotyping ("greeks are lazy / shifty / uppity" etc) passing for serious analytical discourse, there's not enough "germans are stupid" and "capitalism is bullshit"

It's us and them all over again, innit. They're always wrong and we're always right.

they're wrong insofar as "they" are banks charging interest rates too high to pay back. always

is this a coup?

― hot doug stamper (||||||||), Sunday, 12 July 2015 Bookmark Flag Post Permalink

The third one?

By trying to push out Greece the Eurozone wants to send a 'this is what happens if you even try to contemplate leaving the Euro'. Its not about whether its worth saying, the alternative is too messy to contemplate, the show must be kept on the road.

There was a temporary Grexit idea last night - that has been dropped. The 50bn sell off of assets (i.e. negotiation tactic, also called waterboardng) seems to be a 'up to' 50bn now.

This morning Eurozone wants all sorts of checks to be consistently applied as it doesn't trust Syriza. Or something.

A deal has been reached. Struggle to imagine it could include handing ports and national grid to Luxembourg to sell off to the highest bidder but we shall see.

Tusk has confirmed rumours of agreement but says several national parliaments, presumably including Greece and Germany, will need to sign off.

The concession Tsipras was able to win was that the independent group in charge of selling off €50bn of state assets will be located in Athens rather than Lux. Wouldn't bet on Syriza getting this through parliament without falling apart.

Even the idea of selling 50bn in the first place is crazy.

None of this will gte sign off - see you this time next week.

It's not just the value - it's the nature of the assets. Strategically and psychologically, losing control of Piraeus and other key ports would be a massive blow and I can't see how Tsipras would be able to convince Independent Greeks or his own party, let alone the majority of Greeks who voted against much less extreme measures, even if he'd had some sleep last night.

Agreement details here:

http://www.consilium.europa.eu/en/press/press-releases/2015/07/pdf/20150712-eurosummit-statement-greece/?utm_source=DSMS&utm_medium=email&utm_campaign=Euro+Summit+Statement+12%2f07%2f2015&utm_term=952.16310.1082.0.16310&utm_content=all+customers

http://www.newstatesman.com/world-affairs/2015/07/yanis-varoufakis-full-transcript-our-battle-save-greece

what a tool

cant believe that ppl who have to make shit happen didn't welcome his awesome powers of theoretical/analytical framing

Sounds as good an alternative to what is currently being proposed.

greece should sue the british for $50b for stealing the elgin marbles

ppl who have to make shit happen

serious, grown-ups, rite?

lol u a power worshipper

Obviously not democratically elected politicians. Anyway, when's the UK referendum, I've changed the position I've held all my adult life and now want out of the EU ASAP.

We can't live in this Marxist utopia folks. Bills have to be paid, and in full too.

Hey if all the EU did was listen to Russell Brand twats like the IMF nothing would ever get done.

this is a textbook case of disaster capitalism, which naomi klein called a ways back

http://www.naomiklein.org/shock-doctrine/resources/disaster-capitalism-in-action/tags/greece

i hope they teach this at wharton and other MBA programs! destroy and privatize!

lol Naomi Klein rite on!

am I doing dis rite I've tryed not to spell anyting rite!

I think this sums it up best

https://pbs.twimg.com/media/CJzJhTtW8AAcnqg.png

not really

y knot

ooo dem wotten germans

lol u spelt 'rotten' rong

dem wotan germans

ruffly 90 purr scent of bale out munney went to banx not greeeeece

http://america.aljazeera.com/articles/2015/7/1/greek-bailout-money-went-to-banks-not-greece.html

now that's how you grow a national economy

lol Wotan tbf

omg to banx! I fot it went to the govt and then to ministers and then straight to the poor well the scales well and truly etc now

financial depressions are hilarious! 25% unemployment is funny!

http://www.tradingeconomics.com/greece/unemployment-rate

lol @ greece!

wait

if we agree not to lol at Greece, if we were lolling at Greece, then its going to be OK for Greece?

and you say Naomi Klein told you this?

man that's fucked up she should really be more careful about what she puts out there

everything is going to be okay for everyone forever as long as we continue privatizing profits and socializing losses

^ grown up serious ppl making shit happen

tch tch stop laughing at Greece

darraghnebb

This is the least justified position of condescension since Raccoon Tanuki in his early 2015 prime.

lol milo

I for one am glad that someone is finally speaking truth to power

I'm....not sure what valuable discussion I've been detailing here by offering dissent at what seemed a suitable level for the audience at the time. flopson and xxxyyyz haven't posted all day and all matt offers is rote meta zing based on obscure jol beef.

the rest pff

rote meta zing based on obscure jol beef

wait I thought this was your schtick

Hey, hold on, Jol Out has made it across the Atlantic?

xyzzzz was the 1st person to respond to you d

I know but not since then, besides I've an email from him circuitously provoking me about sf that I want to consider in full before responding

lol at jol out travelling power

OK I'll take evening off from thread I promise God bless all here

Ah ok it's just not always 100% clear where the "of course I'm being asinine what do you expect talking to these plebs" section starts exactly

Legitimately think there could be a Brexit now after this. You've got the UKIP crowd, and a decent chunk of Tories who want out. Their position will be unchanged, although some Eurosceptic Tories are up in arms about the treatment of Greece from a national sovereignty point of view - e.g. that vile MEP Dan Hannon.

There's always been the old left anti-EU crowd, - Tony Benn and that - although fairly insignificant in recent years, there will no doubt be an upswing in left-motivated anti-EU sentiment. In Scotland anyway I'm seeing a lot of disillusion from left-wing internationalist, pro-independence, erstwhile pro-EU types.

Yes, fuck this shower of free market shitheels.

Kinda feel that Brits have to get really desperate before voting against status quo - fear that you personally might be worse off tends to trump all other concerns, cf well you know

Darragh I was j/k. I don't mention sf to get a rise out of you - they are part of the wider picture.

what a tool

― licorice oratorio (baaderonixx), Monday, 13 July 2015 Bookmark Flag Post Permalink

Are you going to explain this? Varoufakis isn't ofering any solutions and I know the guy's personality rubs off wrong - and I'm sure plenty would deny the picture he paints of the discussions he took part in - but from that interview you have to deal with the fundamental problem. Do the Greeks get tied under an auserity program until 2059 or whatever?

I doubt this is over. i) this might not get through, ii) even if it does it will be hard to implement, especially given that Syriza have a strong mandate. A bunch of broken-up, discredited technocrats aren't going to simply run with the show overnight.

Podemos and the like are looking at what Germany is doing and they now will have other negotiating tactics when trying to 'step out of line'. In the long-term the ideals of solidarity that a lot of people have given to this European project were damaged last night.

what are the odds on the Greek Parliament not accepting this ridiculous "deal"

Xp - well from the rest of your post we obviously have very different takes on this but beyond that Varoufakis has consistently made this whole thing to be about him. "They just couldn't get what I was telling them, they were out there to get me, read my blog for more details", while not taking a single initiative domestically. Oh and had time for a nice glossy vanity photo shoot with wifey but couldn't be bother coming to parliament to vote on one of the most decisive votes in its modern history cause he had a party to go on his island with his daughter. *SORRY :))*
To be fair, this often happens when academics get involved in politics and are afraid to get their hands dirty, but Varoufakis never really tried to get off his patronising high horse

I partly agree - Tsipras is the politician (Varoufakis isn't even a member of Syriza). From that article he has done a lot of advising and has been bruised and taken out by people who do the dirty work. But again he did put in the hours at the negotiating table to try and work it out. Tough to know what is the best course. Syriza are an odd coalition of people, not all of whom are politicians and technocrats - that is a good thing, but it shows. A lot of the left on Twitter are criticising their tactics, but they didn't win votes and Syriza were able to.

That explanation for not taking part doesn't put him in the best light however he had a diff take on the situation and so not entirely surprising he was going to abstain from voting.

Indeed Varoufakis seems like a self-promoting blowhard but that hardly renders him out of place in European politics. Maybe he was right, maybe he wasn't, but in the end he wasn't even supported by his own party.

I can also report me and Darragh are fine, judging from email I just got :-)

judas

Dunno how much this will affect the UK referendum tbh. Fiscal conservatives will be happy that Greece has been railroaded into "getting its house in order". Those on the left will wonder whether the austerity agenda of the EU is materially worse than the austerity agenda of Osborne et al. Eurosceptics gonna Eurosceptic, as before. As wins says, people have to feel a direct imminent threat or benefit before ditching the status quo.

parallels imo btwn Collins/dev and the treaty in tsipras/varoufakis?

Man, some of the comments... what did people expect, that Greece (and everybody else from then on) wouldn't have to pay back any of its debt and that the free billions would keep on coming without any attempt at changing the bottomless pit nature of the Greek economy? It's easy to be generous with someone else's money...

Oh, and media people: yes, that Krugman guy won some major prize, years ago. That doesn't mean he is always right about everything.

BTW, of course I'm not blind for the emo arguments abput the suffering citizens. But if I don't pay my bills, my kids gets evicted too.

That is moronic.

household spending /= govt spending. any deal without debt relief is almost just managed decline for greece ny this point. let's let it sink slowly into the sea

It's easy to be generous with someone else's money...

great phrase bro, is it one of your own? You're clearly an original thinker.

The whole point is that austerity has depressed the Greek economy to the extent that it's made it less, not more, likely to be able to pay it's debts. Even allowing for the incompetent nature of successive Greek governments and the barely functional nature of its tax system.

If we're going to throw around accusations of childish behaviour, the response of the EU/ECB to this point, which has been made by multiple economists admittedly less knowledgeable than the guy responsible for 'Keep the Meme Alive: Pippa's Arse', has been to stick their fingers in their ears and go 'ner ner ner ner ner not listening'.

You would think the EU would be more alert to the geopolitical dangers of creating a failed state with rapidly growing fascist parties in a region of massive historical instability as well, but apparently not.

Perhaps if Greece's creditors weren't prepared to accept the risk of default / debt cancellation, then they shouldn't have been charging interest in the first place.

It's also worth emphasising that it is those same creditors, in the form of the Troika, that are responsible for enforcing the punitive settlement on Greece. Under most circumstances bad debts get written off, and creditors have to bear the moral risk of lending that money. I agree that analogy with household debt is often unhelpful, but one parallel holds good: no creditor can force a bankrupt household to come up with money it doesn't have, just as most formally bankrupt states throughout history (including Germany in both the 1920s and 1950s) tend to have bankrupting debts written off or restructured, something that the Troika seem totally unwilling to countenance. This course of action will have the counter-productive effect Matt writes about above, a disaster for the Eurozone and Europe more generally.

But, y'know, "maybe Greece shouldn't have run up such a big credit card bill!!!"

I enjoy a crap analogy as much as the next guy but in if I don't pay my bills, my kids gets evicted too to what is eviction analogous?

won't someone please think of the imaginary children???

I don't know much about the Belgian welfare state but I'm assuming the result of said eviction wouldn't be the kids starving on the streets?

some low shots here - StanM partly right, some of the post-game victory speeches after the referendum were just stupid - why would anyone think that creditors would agree to a third bailout and debt cancellation without any type of commitment from Greece? Don't see what's childish about pointing out that Greece put itself in this mess (and we're not talking just about a small corrupt governing clique, whole country has been living on absurdly easy credit for the last 15 years and dug its own grave with the Olympics - doesnt mean they have to be punished for all of eternity but still some of the OXI camp seems to think that this whole mess just came out of the blue).
Agree with Matt tho that it's still very questionable, even from the creditors pov, that extra austerity would bring recovery and ultimately get them their money back (see Piketty's analysis for instance) but just dismissing the creditors as evil capitalists with an austerity fetish does not help.

it doesn't help but it's true

BTW, of course I'm not blind for the emo arguments abput the suffering citizens. But if I don't pay my bills, my kids gets evicted too.

― StanM, Tuesday, 14 July 2015 Bookmark Flag Post Permalink

The Tories say this kind of stuff all the time.

xxp how is it "the whole country"'s fault that Greece was offered easy credit by irresponsible creditors? Were ordinary Greeks expected to demand higher interest rates on the basis that they could foresee this kind of disaster? And the Olympics might have been a folly, but that can hardly explain the situation that Greece finds itself in now.

eurozone only thread badly wanted

aux armes etcetera

http://marianamazzucato.com/2015/07/13/greece-and-the-eu-a-macro-and-micro-mess-up/

^ this is a good piece - shows how Germany et al. were more than happy to get Greece to accumulate debt and now are willing to keep them in a depressed state for as long it takes. Whatever it means.

zone policing

I agree that analogy with household debt is often unhelpful, but one parallel holds good: no creditor can force a bankrupt household to come up with money it doesn't have,

Yeah. There used to be a way, or at least a more punitive measure, which was debtor's prisons- obviously a great way to ensure payment of debts, that, sticking people in chokey.

Not sure if any of those making household credit card analogies would look back on that system fondly... but idk, maybe they would. Maybe that's going to be the next big thing for the right. Anyway, conditions imposed on Greece more analagous to being locked in Marshalsea with Chalres Dickens' dad, than any normal kind of bankruptcy proceedings.

wdn’t frame it in quite those terms but baaderonix otm about certain one-sidedness of perspective here

this was long time coming & (though i’m pretty ignorant in these matters) hard to see any realistic (i.e. irl, in this actual world as currently constituted, economically & politically feasible solution that wd not involve any austerity)

nyt article linked by mordy a while back instructive that it’s not just troika but poorer countries’ circumstances & citizens constraining hands here

of course ordinary greek citizens not to blame; it’s political & economic ‘elites’ (all around) that fubar
but (ideal utopian morality aside) assigning black hats white hats without grey in this scenario seems tad over-simplistic too

happy to keep morality out of politics, but let's not pretend that "realism" = "neutral acceptance of immutable laws of nature"

no reference to natural laws here:

in this actual world as currently constituted, economically & politically feasible

Sure the OXI camp could have tried to change the game but then they shouldn't have been clamouring to stay in the euro - orthodox monetary policy is what made it impossible for Greece to do anything but balance deficits and at least appear to pay off debts.

xp let's not pretend that "realism" = "neutral acceptance of immutable laws of nature"

agreed

just looking at limited local (in historical terms) state of affairs, with certain (current) systemic constraints & conditions
and limited range of viable choices of action (with attendant consequences) for political actors (constrained in multiple ways on multiple levels)

economically & politically feasible solution

there's still not any clear agreement on what the true problem is, the conflict is over diagnosis

in this actual world as currently constituted, economically & politically feasible

time for a change.

xp you're right-- there's the rub; made me realize i'm being over-simplistic too
conflict over diagnosis is why greece debate so intractable

the problem of stressing what's permissible under the rules of the existing economic setup is it looks a lot like you're cheering for it

It's the classic Thatcherite rhetorical construction: There is no alternative

Sure the OXI camp could have tried to change the game but then they shouldn't have been clamouring to stay in the euro

From what I can tell there is a lot that is wrong with Greece before they joined the Euro, and by doing that and closing integrating with the rest of Europe many thought things would change for the better?

Looks like it was only until this weekend's events that the Greeks thought they could negotiate and win sizeable concessions -- again that only applies to some in Syriza, not the hardline commies who form some of it -- and carry on with something that was more sustainable.

I don't think it was a having your cake and eating it position.

you know v well from UK politics thread that anyone can grow tired of the perpetual protestation of "if our side were in ....." and "if this enormous actual social barrier didn't exist" and "if the evil right wing majority/evil powerful right wing minority/evil right wing Germans didn't force this of do that or"

which is all well and good if the usual set didn't react with the usual frustrated vituperation upon the posited evil right wing ilxors when that latter group of imperfect souls posited their own doubts about the fantasy solutions proferred something something piketty

matts hypocrisy in accusations of flimsy bases for condescension may need underlining and yknow it may not.

I've wondered to what extent UK ilxor political Guardian internet snark is borne out of the same frustration of always seemingly being an idealistic opposition: going back as far as most of us have had a voting interest, maybe- within new labour, against new labour's actions, now with a Tory govt and maybe more comfortable in spinning strategies (well, tbf, just railing against strategies maybe) and awaiting idk

what are ye awaiting exactly? taking what shape, coming from where and led by who?

it'd be an interesting question to have answered and its admittedly as easy for me to pose as it is for any of yis to choose instead to react as if someone on yr internet comfort room intellectual forum pissed on yr political chips

ps yet again umpteenth time I vote harder left than u, don't it kill u but

xp this isnt aimed at anyone rly well maybe conrad and bananaman and matt the rest of ye are yknow grand sorry I rise ye as much as I do. not sorry enough not to do it

as an apology that may need a polish in fairness. first paragraph for nv

are you having a breakdown

xps the problem of stressing what's permissible under the rules of the existing economic setup is it looks a lot like you're cheering for it

true (not cheering btw; but not throwing molotov cocktails atm either)
this concern re what/who it might look like we're cheering can also distort/obstruct conversation/ thought

like i said, pretty ignorant in these matters & don’t know what’s possible & not possible here
true, sometimes crisis offers opportunity to affect/ alter rules of the game
just watching things play out, clueless here

xp you said it, mate. you said it.

deems :)

Deems the problem is that you think everyone here is living in a fantasy world when actually I acknowledged the problem you mentioned as recently as three days ago. You've got to allow people time for raging because really what is more pointless than going "well it's just an intractable problem, what can you do, sorry Greece!"

I reserve the right to pour scorn on anyone still using a government=household budget analogy especially given the shit we're going through over here right now.

OK I will cede the second point as an interim rapprochement

cool i broke darraghmac's brain

what are ye awaiting exactly? taking what shape, coming from where and led by who?

ppl in general not very forthcoming with this cf. desolate uk constitutional reform thread I started

xp Anyway,

the problem of stressing what's permissible under the rules of the existing economic setup is it looks a lot like you're cheering for it

this. In fairness I should probably try to get less irritated by this and stop imagining the ppl stressing the limits of the possible doing so with big grin on their faces burning 50 euro notes while skypeing unemployed Greeks.

You've got to allow people time for raging because really what is more pointless than going "well it's just an intractable problem, what can you do, sorry Greece!"

Could do without the subtle hints of gloating too tbh. LOL @ 'UK ILXOR Guardian reading contingent' generalizations.

xp

but maybe there should also be a moratorium on describing the few politicians trying to push back somewhat against aggressive neoliberalism and unfettered rule by the rich as childish, or unserious, or sixth form or what have you.

^ realise that's a loaded description, so substitute your own if applicable i guess

multiple economists admittedly less knowledgeable than the guy responsible for 'Keep the Meme Alive: Pippa's Arse',

This was a zing and a half from Matt DC.

xp fair enough bb

I'll try to do better but tbh I will have to talk to my ppl before retracting the guardian one tho tom

maybe I'm overstressing it itt or maybe not enough, but again to contextualise it, the chastening of syriza has an element of serious local benefit over here wrt the decreasingly credible spectre of sinn féin. if that has over-coloured my POV on the impact of a strictly-applied set of reforms on greece to anyone's distress then I apologise.

that said, I do find the level of doom prophesying regarding the package curious- I partook in this and then some in the Irish politics thread of 2008 but pushing out repayments while opening lines of credit does seem to have worked reasonably well here (notwithstanding underlying differences in national asset/income infrastructures obv).

discussions of haircuts vs austerity seems to me to be a much smaller debate in this context than the type of systemic change being pushed almost everywhere, is there not a large case here for an element of politically-motivated reporting brinkmanship that maybe exacerbates everything (down to and including humble message board debate)

imho greece should have to pay their debt but at the same time the european union should acknowledge not only that AUSTERITY HASN'T WORKED but they should justify what else is to be gained by persisting with a scheme that HASN'T WORKED and MADE THINGS WORSE beyond 'punishing greece' / 'showing italy / portugal / spain that they won't get better debt relief conditions, so don't even think about'. if the EU can't do that then fuck them; this condition that greece hold a firesale of national assets to raise $50b seems like blatant disaster capitalism, and that is asking for trouble big time

Irish debt is supposed to be repaid via growth, greek via asset-stripping

to contextualise it, the chastening of syriza has an element of serious local benefit over here wrt the decreasingly credible spectre of sinn féin.

realpolitik talk

you said it mate

is arguing against prevailing concepts instead of simply capitulating brinkmanship or is arguing for simple capitulation to prevailing concepts brinkmanship or is it the combination that makes for brinkmanship?

i said it mate

a possible solution is moving toward a union more federal like the US has, with national taxes becoming something like state taxes, and 'continental taxes' something a strong IRS type central institution (the ERS?) can collect and redistribute where needed, a la how rich american states like New York and California prop up poorer greece-like states like Alabama and Tennessee. i'm not sure if that's something europeans want or could even effect if so, given the thousands of years of history of each member state (and all the acrimony and bad blood over the millennia)

it's a good question xp. I suppose if you allow for degrees of constructiveness in arguing against and degrees of negotiation in capitulation to it might be a better question or might address the brinkmanship aspect.

wrt to "national assets" are we talking about the Port of Piraeus? which is owned by a corporation?

Maersk Looks to Buy Greek Ports of Piraeus and Thessaloniki. The other one is the energy grid.
.

yeah I see. I'm reading about the Piraeus Port Authority, a publicly-traded corporation that owns the port, but for whom at present the Greek government owns ~74% of the shares. the agreement calls for the government to sell a big part of its shares. The IPO was in 2003, with Bank of America as advisors.

there's a lot of rhetoric going on about this sale, I'm trying to follow the money better.

Greece is not Ireland etc etc.

totally accepted, my "nevertheless" above is a clumsy elision, but I'm interested in the extent to which the sides could meet (could have met, by now) were syriza not so diametrically opposed to working with Germany his troika etc

am i just sheltered or has literally no public figure outside the euro elite written approvingly of the new deal?

but I'm interested in the extent to which the sides could meet (could have met, by now) were syriza not so diametrically opposed to working with Germany his troika etc

That's all history now.

although it was patently counterproductive for greece to oppose troika I'm interested in what would have happened if they hadn't

?

totally accepted, my "nevertheless" above is a clumsy elision, but I'm interested in the extent to which the sides could meet (could have met, by now) were syriza not so diametrically opposed to working with Germany his troika etc

Takes two to tango and the Troika were delighted to have Syriza as their partners, eh? By the way, I'm no great fan of Syriza and Tsipras, even less of Varoufakis, but I then don't think any of the Guardian Reading Disappointed Lefty ILXors have actually said they were.

https://www.youtube.com/watch?v=Zvl9N9GdraQ

you know v well from UK politics thread that anyone can grow tired of the perpetual protestation of "if our side were in ....." and "if this enormous actual social barrier didn't exist" and "if the evil right wing majority/evil powerful right wing minority/evil right wing Germans didn't force this of do that or"

broadly yeah i agree of course, i just think the opposite of this is maybe uglier sometimes

what are ye awaiting exactly? taking what shape, coming from where and led by who?

the short answer is "i think we're all very fucked", the longer answer needs its own thread

on one level it's disingenuous of me to critique the specific rules of a game i think is hopelessly crooked. mea culpa. on the other hand i feel like realism, Panglossian or not, rarely seeks to justify itself or offer any vision beyond apathy; and sometimes it disguises a blanket contempt for other people as a scientific identification of the Facts of Life

and well, one worldview's as good as another i guess but i don't think inner conviction and honesty about means and ends is much the preserve of the anti-utopians any more than the utopians. for a conversation to serve much purpose we could all do one another the courtesy of accepting that this shit matters...if only to our own psyches

http://www.salon.com/2015/07/14/the_rise_and_fall_of_the_german_empire_what_greeces_crippling_bailout_deal_reveals_about_the_future_of_europe/

i don't think inner conviction and honesty about means and ends is much the preserve of the anti-utopians any more than the utopians. for a conversation to serve much purpose we could all do one another the courtesy of accepting that this shit matters...if only to our own psyches

this is v true. hope i didn’t seem to suggest otherwise, that was not my intention
‘anti-utopianism’ for me not a settled position but one among several conflicting bents/bends of thought, it’s fraught & i do call it into question; it needs to be continually called into question
you’re right that, uninterrogated, it can sometimes disguise bad stuff; uninterrogated utopianism, likewise

I don't know what he was like in negotiations or how to judge his domestic efforts but I broadly agree with Varoufakis re: Europe, I think that's where the most fundamental problems lie & that they have not been addressed thusfar. If the EU really is less ambitious about its future then I want out

love how krugman is calling this "the sack of athens"

http://krugman.blogs.nytimes.com/2015/07/14/faithocrats/?module=BlogPost-Title&version=Blog%20Main&contentCollection=Opinion&action=Click&pgtype=Blogs®ion=Body

http://krugman.blogs.nytimes.com/2015/07/14/the-pause-of-2014/?module=BlogPost-Title&version=Blog%20Main&contentCollection=Opinion&action=Click&pgtype=Blogs®ion=Body

preach it professor!