"They want to put us in a straitjacket so we work for free all our lives so that some can have their wealth and get very rich at our expense," said Sotiris Poulikogiannis, a protester in Piraeus. "We don't accept this. Day by day we'll grow stronger and more aware of how to overturn this situation."
This is madness!
God bless 'em, they sound like they are on the verge of discovering alchemy's greatest goal, for if not he's talking out of his ass. The Greeks are like rats in a cage that cannot be chewed through but the rat tries nonetheless. They have no out here, not until they truly appreciate the position they're in. So far they have not.Day by day we'll grow stronger and more aware of how to overturn this situation."
<- HAHHAHAGreek pensioners on average live on 96 percent of the salary they had when they worked, more than twice the proportion of earnings as Germans
The 240 billion euro economy, which accounts for about 2.5 percent of the euro zone, contracted 3.5 percent in the three months to June compared with the same period last year as the downturn worsened from an upwardly revised 2.3 percent decline in the first quarter.
They are down for the count and I feel we are on the same path with our spending.
Spending is not what is hurting the US right now.
Not spending is.
The problem is simply a multi-decade campaign of spending more than is brought in. So you can blame it on excess spending or on inadequate income; but the balance has been untenable for many years.Spending is not what is hurting the US right now.
Not spending is.
Staff teams from the European Commission (EC), the European Central Bank (ECB), and the International Monetary Fund (IMF) visited Athens during July 26-August 5 for the first quarterly review of the Greek government’s economic program, which is being supported by a EUR 80 billion loan from Euro area countries and a EUR 30 billion Stand-By Arrangement with the Fund. The strategy and key policies remain as described in the May 2010 Letter of Intent and Memorandum of Economic and Financial Policies (see Country Report No. 10/111).
Our overall assessment is that the program has made a strong start. The end-June quantitative performance criteria have all been met, led by a vigorous implementation of the fiscal program, and important reforms are ahead of schedule. However, important challenges and risks remain.
I guess we can agree to disagree.
We spent ~20 billion last month on interest for our debt, and that number will get larger and larger every month. Assuming it stays at 20 billion a month (its growing), thats 240 billion dollars a year in interest. Saying that is not whats hurting us is just silly.
Its actually much worse. Our bond rates are at historical lows so our "interest rate" is well below the historical average. In order to reduce our interest payments we moved almost all of our debt to the short end so we basically have to roll over almost ALL of our debt every 4-5 years. When our interest rate rises, and history tells us it will rise significantly from where it is, we will almost instantly see a very large increase in the cost to service our debt.
Its akin to getting an ARM when interest rates are at historical lows. The interest rate really only has one way to move and when it does its gonna hurt, bad...
Unless of course someone wants to argue that we can continue to indefinitely borrow assloads of money AND keep bond rates where they are?
In order to reduce our interest payments we moved almost all of our debt to the short end so we basically have to roll over almost ALL of our debt every 4-5 years.
http://www.spiegel.de/international/europe/0,1518,712511,00.html
Paints a grim picture, Greece sounds like it is going down the tubes, but they had no alternative. I wonder how many other countries will carry on until faced with the same.
Public shuts down businesses in protest - what else can be expected. They are cutting off their nose in protest of how ugly their face is.Wow - depressing article. That nation seems to be in a death spiral. There's a very powerful lesson there for the U.S., but we probably will ignore it.
zephy doesn't austerity have a deflationary effect ultimately anyway? If it's severe enough. So it really sounds inline with your first option.
In the case of Greece they had little recourse. It was either austerity to get more loans or simply start defaulting on them.