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Greece/Euro/EU – “Quote of the Day”

Via: Huffington Post

“There’s a disagreement on the fiscal side, and unless that is resolved in the next three days, then I’m afraid the summit could turn out to be a fiasco.

And that could be actually fatal because you are facing the possiblity of Greece leaving the euro and perhaps the European Union, and you need to strengthen the remaining euro structure to withstand that shock.”

– George Soros told Bloomberg TV.

http://www.huffingtonpost.com/2012/06/25/george-soros-germany_n_1623810.html?utm_hp_ref=business

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June 26, 2012 Posted by | Uncategorized | , , , , , , | Leave a comment

And Then What? – Paul Krugman

Via: NY Times

So it appears that the governing coalition in Greece has pulled out a narrow victory — winning only a minority of votes, but getting a narrow majority in the parliament thanks to the 50-seat bonus New Democracy gets for coming in first.

So they will now have the ability to continue pursuing an unworkable policy.

Yay!

Joe Wiesenthal tells us that there’s a meme in Greece to the effect that Syriza didn’t really want to win, because it would rather see the current government flail some more.

Conversely, establishment types should actually be dismayed by this outcome: if current policies fail completely, which seems almost a GIVEN, and Greece exits the euro anyway, which seems highly likely, the entire Greek center will end up discredited; better, in a way, to be able to blame the radicals.

And I gather I’m not the only one thinking along these lines; Business Insider also reports hints that Pasok, which has suffered terribly from its identification with failing policies, might not continue in the coalition unless Syriza is also brought on board — which then raises the question, why would Syriza do that?

The debacle rolls on.

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You can read all of the Nobel laureate’s blog, and column, here:

http://krugman.blogs.nytimes.com/

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personal thought:

Q: Could it be worse?

A: possibly

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Q: Will it get worse?

A: probably

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June 18, 2012 Posted by | Uncategorized | , , , , , , | Leave a comment

Greece Still Going Broke, Now Faster And With More Broke-Ness

Via: Huffington Post

If you could rely on anything in the past couple of years, it is that Greece is always going broke. Now it turns out that Greece is going broke faster than almost anybody expected.

The Greek government is struggling to collect enough tax revenue to cover its immediate bills, the New York Times reported on Wednesday, leaving it about 1.7 billion euros shy of its budget goals. It may soon need to freeze government salaries and pensions, temporarily halt imports of food, fuel and medicine, or dip into cash intended to help Greece’s gutted banks, the Times writes.

This comes less than three months after Greece received the first installment of a new, 130 billion-euro bailout package in March. The hard-fought bailout agreement with Greece’s European rescuers involved excruciating belt-tightening that has helped make the country’s deep recession even worse. That tends to have a dampening effect on tax revenue, as the U.S. government can attest.

Austerity, in other words, is self-defeating, which is one reason the rest of the world is dragging Europe’s biggest austerity fan, Germany, toward policies that favor economic growth instead.

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The world has recently grown weary of caring about Greece’s money problems and has instead turned its attention to the money problems of Spain, which yesterday warned it was at risk of being SHUT OUT of  the BOND MARKET and that its banks needed a multi-billion-euro bailout.

The European Central Bank this morning stood pat on taking any more action to help Europe right now, in what might be an effort to force European politicians to make some hard choices and hammer out a long-term solution. Greece, which will likely need more bailout money or risk falling out of the euro zone, may be back on the agenda sooner than policy makers think.

http://www.huffingtonpost.com/2012/06/06/greece-going-broke_n_1573865.html

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personal thought:

“. . . what might be an effort to force European politicians to make some hard choices and hammer out a long-term solution”; well that’s great, and good for them.

But what IF, they/we have reached the ‘tipping point’, and there are NO long-term solutions, simply more half-ass, stop-gap fixes?

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June 7, 2012 Posted by | Uncategorized | , , , , , , | Leave a comment

Stiglitz says European austerity plans are a ‘suicide pact’

Via: The Telegraph

Imposing austerity measures as countries slow towards recession is a   fundamentally flawed response, said Mr Stiglitz, who won the Nobel prize in   2001 for his work on how markets work inefficiently.

“The answer, even though they see over and over again that austerity leads to   collapse of the economy, the answer over and over [from politicians] is more   austerity,” said Mr Stiglitz to the Asian Financial Forum, a gathering of   over 2,000 finance professionals, businessmen and government officials in   Hong Kong.

“It reminds me of medieval medicine,” he said. “It is like blood-letting,   where you took blood out of a patient because the theory was that there were   bad humours.

“And very often, when you took the blood out, the patient got sicker. The   response then was more blood-letting until the patient very nearly died.   What is happening in Europe is a mutual suicide pact,” he said.

Keynesian economics, which require governments to help sustain demand,  suggests that austerity measures should be imposed when an economy is booming, not waning.

http://www.telegraph.co.uk/finance/financialcrisis/9019819/Stiglitz-says-European-austerity-plans-are-a-suicide-pact.html

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January 18, 2012 Posted by | Uncategorized | , , , , , | Leave a comment

Europe’s Currency Union: A Bad Marriage That May Have To End

Via: Huffington Post – Peter S. Goodman

The European currency union has become like a bad marriage whose deep-seated problems have burst embarrassingly into public view, while the beleaguered partners stay together for the sake of the children.
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Maybe it’s finally time for the unhappy couple to own up to the fact that they were never meant to be together. They bring too much historical baggage (a couple of World Wars, disagreements about whether it’s okay for pork products to hang in shop windows).
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It often seem as if they are speaking different languages!
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The children — Greece, Italy, Spain, Portugal and Ireland, for openers — might actually be better off living by themselves. (Because, really, if your parents were Germany and France, with each decision in your life requiring their peaceful concurrence, how long ago would you have run away from home?)
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You can read the rest, HERE:
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photo:
‘Mom and Dad’
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December 10, 2011 Posted by | Uncategorized | , , | Leave a comment

Krugman – “Killing the Euro”

Via: New York Times

Can the euro be saved? Not long ago we were told that the worst possible outcome was a Greek default. Now a much wider disaster seems all too likely.

True, market pressure lifted a bit on Wednesday after central banks made a splashy announcement about expanded credit lines (which will, in fact, make hardly any real difference). But even optimists now see Europe as headed for recession, while pessimists warn that the euro may become the epicenter of another global financial crisis.

How did things go so wrong? The answer you hear all the time is that the euro crisis was caused by fiscal irresponsibility. Turn on your TV and you’re very likely to find some pundit declaring that if America doesn’t slash spending we’ll end up like Greece.

Greeeeeece!

But the truth is nearly the opposite.

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And you can read WHY, here:

http://www.nytimes.com/2011/12/02/opinion/krugman-killing-the-euro.html?_r=3

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December 3, 2011 Posted by | Uncategorized | , , , , | Leave a comment