I was objecting to his repeating the crap about how fractional reserve banking works, I wasn't addressing the Greek mess. I don't think there's a good answer there.
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Germany Says ‘Nein’ to Greece Bailout Request
- Thread starter Perspicuo
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I was objecting to his repeating the crap about how fractional reserve banking works, I wasn't addressing the Greek mess. I don't think there's a good answer there.
barbos
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It's 315 billions, not trillions.
Duke Leto
Deleted
Point of order, deflation in Greece has been an actual thing for the last three years or so, meaning that since 2012, from the Greek perspective, debts owed in Euros have increased in value by something like 4% or 5% over and above whatever interest has been demanded of them.
Inflation/deflation has been more or less steady in the Euro core over that period.
So what looks like resisting a "haircut" for holders of Greek debt is actually the moral equivalent of "theft" in Ron Paul terms. (Deflation is theft from debtors according to his thinking when applied consistently, although I doubt he'd see it that way.)
Inflation/deflation has been more or less steady in the Euro core over that period.
So what looks like resisting a "haircut" for holders of Greek debt is actually the moral equivalent of "theft" in Ron Paul terms. (Deflation is theft from debtors according to his thinking when applied consistently, although I doubt he'd see it that way.)
tupac chopra
Veteran Member
I kinda doubt someone like Ron Paul would define inflation or deflation in terms of price though.
no they don't. minus debt payments greece is in a surplus. so they have more than enough to meet their needs.
Harry Bosch
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Link?
Jayjay
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Does that budget include the €9.9 billion received from EU and IMF in 2014? If so, that would still put them in the red since the surplus last year was only €1.9 billion.
Perhaps they should not have made promises they lacked the power to keep.
No, by definition a primary surplus is current tax receipts minus current spending net of debt payments.
Generally interest payments count as part of a country's budget. For some reason I don't quite understand it does seem to be the habit to ignore them with respect to Greece.
Maybe you weren't aware that "primary balance" was a thing defined by the OECD back in 2005 and not just for Greece?
http://stats.oecd.org/glossary/detail.asp?ID=6789
http://stats.oecd.org/glossary/detail.asp?ID=6789
Correct, I wasn't aware of it until this discussion since most of the time we do not exclude interest when discussing whether a country has a surplus. Indeed I have never once seen the US budget discussed without taking interest into account.
Jayjay
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I think the definition is revenues minus spending, before debt repayment. Not just tax receipts. So the question still stands, is the money received from the Troika counted above the line as "revenues"? It seems that in 2013, this is exactly how the European Commission defined Greek primary surplus.
Is it just me, or is there just no way the Greeks are ever going to be able to repay all that debt anyway? Isn't this four month extension just delaying the inevitable default? Or is it just an indirect means to prop up whatever fragile confidence lenders might have in the Greek government?
If I were Greek and remotely rich, I would shift my money well away from the government hoping to use that money to pay the national debt, and that would leave only poorer people to take money... who by definition have little to give, especially those 25% unemployed. I can't see that debt being repaid, and I can't see a country just taking endless austerity without some long-term effects on itself. For instance, if you were young and Greek, would you hang around and stay unemployed, or else go to some other EU country where things are significantly better and try there - and probably never go back to Greece, thus distorting the age demographics of your homeland?
If I were Greek and remotely rich, I would shift my money well away from the government hoping to use that money to pay the national debt, and that would leave only poorer people to take money... who by definition have little to give, especially those 25% unemployed. I can't see that debt being repaid, and I can't see a country just taking endless austerity without some long-term effects on itself. For instance, if you were young and Greek, would you hang around and stay unemployed, or else go to some other EU country where things are significantly better and try there - and probably never go back to Greece, thus distorting the age demographics of your homeland?
I think you are operating on some false premises. As far as I can recall there has never been a country that achieved prosperity by incurring massive debts to hand over free stuff to its citizens. Greece government spending as a percent of GDP is about 58%. Very high.
T.G.G. Moogly
Traditional Atheist
Nobody knows the endgame. I'd say it's certain the debt will never be repaid anymore than the US debt will ever be repaid or even paid down to any degree. The problem is that the people who make these decisions are shielded from the results of their decisions. They're not the ones who will be out of a job. They'll be fixed for life regardless the direction things take. So don't hold your breath.
http://www.oecd-ilibrary.org/sites/...-10-en&_csp_=068e923eb1ecbbc65ba8f85d03f6f60d
Denmark, Finland, France, Sweden and Belgium spend more per GDP than Greece does and that doesn't seem to be a problem. So government spending as a percentage of GDP may not be as important as you think it is.
What "free stuff" are you talking about and who is it being handed over to?
There are also lots of countries that spend far less than 58% of GDP on government and do just fine.
What sort of logic drives you to conclude that Greece's main economic problem is not enough government spending?
Since they only tax about 34% of GDP someone is getting something they aren't paying for, eh?
Not to mention if Keynesianism deficit spending worked for shit they'd have to be one of the most prosperous countries on earth.
What sort of logic drives you to conclude that's what I was saying? I was addressing the stat you tossed out that Greece government spending is 58% of GDP as if it actually meant anything.
Presumably. The question is who and what are they getting. If it's the wealthy using their connections to get free stuff from the government then how do you propose to fix that with austerity aimed at the general public?
Except Greece wasn't engaging in Keynesian deficit spending. They were engaging in let's let the wealthy loot the country. There's a difference.