Eurozone will collapse...

[Stop It]

Originally Posted by Damien

Some German politicians are asking the same question according to The Guardian. It does appear that Greece has folded entirely when it became clear they were in no position to make demands.

Or, it's just part of the Greek game.

1: "Accept" all of the demands of the creditors. Possibly sign a few token laws into force to show they "mean it this time"

2: Get a sizeable chunk of money from the creditors, get enough money for the banks to stay open long enough to nationalise them, enforce heavy losses on bond and shareholders while protecting deposits.

3: Do nothing after this, and wait for the protests to really hit.

4: Roll back all of their promises, stating that they "Value democracy over blackmail and the people cannot stand more austerity"

5: Laugh manically as they have saved their government, outfoxed the Germans and got everything they wanted.

6: Syriza become massively popular in Greece and seen as heroes and untouchable.

7: Syriza hope to the gods that they don't get kicked out of the EU for such brazen thievery.

This all assumes that Germany et al actually believe a word Tsipras says, which is still up in the air, even with the likes of France, the US, IMF etc putting pressure on them to accept.

This weekend will be fun.

[Osem]

I really can see a whole load of resentment and bitterness building up within Europe. Pretending it's not there or simply going to fade away is delusional and simply storing up bigger problems for the future IMHO. A radical rethink is required sooner rather than later.

[alanbjames]

Originally Posted by nomadking

But some of that was achieved by simply delaying problems. Eg Wages policy which brought inflation down, backfired years later when everybody wanted to play catch up and restore the differentials between the levels of pay.

Not sure being at school and being asked to buy your own paper is a good thing. Some of us were there in the late '70s.

When my son was at secondary school 93-98 he was required to take all his own paper, maths equipment and pens. Students even got punished by detention if they didnt even when their families couldnt afford this which i thought was so wrong.

[nomadking]

Originally Posted by alanbjames

When my son was at secondary school 93-98 he was required to take all his own paper, maths equipment and pens. Students even got punished by detention if they didnt even when their families couldnt afford this which i thought was so wrong.

You were always required to buy your own pens and maths equipment at secondary school. If the school had supplied those items, they would inevitably have been broken or not returned. It was paper in the form of exercise books or loose leaf in 6th form that was supplied by the school.

[heero_yuy]

Originally Posted by nomadking

You were always required to buy your own pens and maths equipment at secondary school. If the school had supplied those items, they would inevitably have been broken or not returned. It was paper in the form of exercise books or loose leaf in 6th form that was supplied by the school.

Same when I was at school in the early 70's. We had to buy our own sliderules* too but through the school so we had the approved type(s).

*Mechanical calculator.

Greece is just putting off the day when they get blown out of the Euro. Austerity has contracted their economy by over 25%. How on earth can they pay back a payday loan with another payday loan. We all know where that can lead.

Originally Posted by heero_yuy

Greece is just putting off the day when they get blown out of the Euro. Austerity has contracted their economy by over 25%. How on earth can they pay back a payday loan with another payday loan. We all know where that can lead.

I think they'll probably get a debt write-off or 'restructuring' at some point when it's more political tenable for the creditor states to do so. At the moment the amount of attention it's receiving combined with Spanish elections this year makes it difficult for the Eurozone but ultimately I think they all know that would be the way forward.

The benefits of Greece leaving the Euro are questionable as well. There is no real advantaging in devaluing the currency of a country which doesn't export much and imports a lot. It's really only dealing with their debt and tourism that would benefit and the former might be addressed at a later date anyway.

[Osem]

Goldman Sachs to be sued?

Somehow I doubt it but IMHO they do have a case to answer.

http://www.independent.co.uk/news/wo...-10381926.html

[nomadking]

Originally Posted by Osem

Goldman Sachs to be sued?

Somehow I doubt it but IMHO they do have a case to answer.

http://www.independent.co.uk/news/wo...-10381926.html

Why? It was the Greek government that actually took out the loans AND spent them. Goldman Sachs just provided a method of hiding them in the accounts. The excessive spending and tax evasion etc of the Greeks was started decades ago, BEFORE joining the Euro. It was already heavily in debt, which is why Goldman Sachs got involved. The Greeks had been fiddling their economic statistics before and LONG AFTER joining the Euro.

In 1974–80 the government had budget deficits below 3% of GDP, and in 1981–2013 deficits were above 3% of GDP.

39 consecutive years of budget deficits and they wonder why they are in trouble.

[Osem]

Originally Posted by nomadking

Why? It was the Greek government that actually took out the loans AND spent them. Goldman Sachs just provided a method of hiding them in the accounts. The excessive spending and tax evasion etc of the Greeks was started decades ago, BEFORE joining the Euro. It was already heavily in debt, which is why Goldman Sachs got involved. The Greeks had been fiddling their economic statistics before and LONG AFTER joining the Euro.

39 consecutive years of budget deficits and they wonder why they are in trouble.

Why they have a case to answer? Well if, as you said yourself, they helped the Greeks cook the books then I'd have thought that's obvious. The only question is to whom they they have a case to answer. Maybe to those countries and institutions who've been bailing out the Greeks and lost billions as a result of a false representation of Greece's economy?...

Suing isn't difficult, doing it successfully is much harder. We all know the Greeks have been acting irresponsibly for decades and must have been complicit in any deception so it'd be ironic (and IMHO highly unlikely) for the Greeks to successfully go down that route. Maybe less so for major German banks.

[nomadking]

Originally Posted by Osem

Why they have a case to answer? Well if, as you said yourself, they helped the Greeks cook the books then I'd have thought that's obvious. The only question is to whom they they have a case to answer. Maybe to those countries and institutions who've been bailing out the Greeks and lost billions as a result of a false representation of Greece's economy?...

Suing isn't difficult, doing it successfully is much harder. We all know the Greeks have been acting irresponsibly for decades and must have been complicit in any deception so it'd be ironic (and IMHO highly unlikely) for the Greeks to successfully go down that route. Maybe less so for major German banks.

Goldman Sachs didn't really cook the books as they didn't prepare them. They just used an allowed method, that other countries have used, to keep debt off the books. Just as PFI is businesses borrowing on behalf of the UK Government without it appearing in any debt figures. They did an awful lot of hiding of debt all by themselves.

Greece has provided sovereign backing to Hellenic Railways, thus allowing it to borrow billions even though the company’s finances are so skewed that it pays three times as much on interest expenses than it collects in revenue. As the debt of state-owned enterprises was not counted toward Greece’s official debt, Greece has been able to use the rail system as a means to support employment while not adding to its official debt number; basically an accounting trick to hide debt.

Yet, already, it is too late. Greece is effectively bust — relying on EU cash from richer northern European countries, but this has been the case ever since the country finally joined the euro in 2001.
Two years earlier, the country was barred from entering because it did not meet the financial criteria.
No matter: the Greeks simply cooked the books. Two years later, having falsely claimed to have met standards relating to manufacturing and industrial production and low inflation, the Greeks were allowed in.

Austria did similar things, again all without Goldman Sachs.

Eurostat’s Austria calculations, published last week, now include state-owned companies that were designed to keep them off the government’s books. That move pushed the nation’s debt level up to 82.6 percent of gross domestic product as of the end of June, now exceeding fellow top-rated nations Germany, the Netherlands and Finland, which stay clearly below 80 percent.
The statisticians’ closer scrutiny of nations was triggered by a 2010 audit of Greece’s state accounts, which forced the country to revise its debt upwards by 24.6 billion euros mostly because it had to include state companies it had kept out of official statistics before.

[Ignitionnet]

Originally Posted by nomadking

Why?

Reading the link in question FTW.

Saul Haydon Rowe, a partner at Turing Experts, a team of former bankers who advise in court cases involving bank derivatives, said: “Greece would have to unpick the trades completely and look into what advice was given, and how much Goldman might have expected to make over the course of the transaction.

“For a legal action to go ahead, Greece would have to show that Goldman Sachs said something it knew was untrue or which it did not care was true or not.”

[nomadking]

Originally Posted by Ignitionnet

Reading the link in question FTW.

Lot of ifs in there. Apparently other banks have done the same for other countries, eg Italy. Greece and Italy wanted a way of hiding their true levels of debt and that is what they got. It was just exploiting an accounting rule.

[Ignitionnet]

Originally Posted by nomadking

Lot of ifs in there. Apparently other banks have done the same for other countries, eg Italy. Greece and Italy wanted a way of hiding their true levels of debt and that is what they got. It was just exploiting an accounting rule.

I'll refer you back to the link again. Nothing to do with the accounting tricks themselves.

[Osem]

Originally Posted by nomadking

Lot of ifs in there. Apparently other banks have done the same for other countries, eg Italy. Greece and Italy wanted a way of hiding their true levels of debt and that is what they got. It was just exploiting an accounting rule.

Well if/when this matter is examined thoroughly by legal experts, the extent to which GS did or didn't do anything legally wrong will be determined. It's the same with the supposedly legal tax avoidance schemes which have been promoted heavily to companies/wealthy individuals only for courts to determine they were illegal.

[nomadking]

Originally Posted by Osem

Well if/when this matter is examined thoroughly by legal experts, the extent to which GS did or didn't do anything legally wrong will be determined. It's the same with the supposedly legal tax avoidance schemes which have been promoted heavily to companies/wealthy individuals only for courts to determine they were illegal.

And what about the other banks/EU countries that did the same?

It would be Greece that would have broken any rules/laws. Greece also used other methods to hide debt, eg publicly owned companies running up debts which don't appear on the government's books.

Their whole economy was propped up by excessive borrowing. They are now having to face the reality of how bad their economy really is and was. Things are having to be cut back because they never could afford them in the first place.