By: charliehunt
- 27th January 2015 at 16:29Permalink- Edited 1st January 1970 at 01:00
Whatever commentators' views of the situation are the stark reality can escape no one with a modicum of interest. I suppose desperate times invoke desperate measures and one can only imagine the Greeks who voted for him believed in miracles and closed their eyes to the real world.
By: Multirole
- 31st January 2015 at 12:22Permalink- Edited 1st January 1970 at 01:00
Governments, especially governments of oil-producing countries, can always borrow money...
...the rub is what the lender charges in interest.
Greece couldn't afford to borrow before a default.....so how will they afford to borrow after one?
Greece has tourism, which is a lot like oil wealth in that nice beaches and climate is a resource that's independent of student test scores and good governance.
Interestingly oil makes up 16% of Nigerian GDP while tourism makes up 18% of Greek GDP.
If Greece had its own currency it could devaluate away, making itself much more attractive to tourists. It's the equivalent of pumping more oil.
By: Creaking Door
- 31st January 2015 at 15:01Permalink- Edited 1st January 1970 at 01:00
Yes, Greece has tourism, but Greece has always had tourism; how does charging less (after devaluation) for something you were charging for anyway help balance the books?
It also begs the question why, even with tourism, Greece managed to get £247billion into debt in the first place? Now I know a lot of this was 'historic' debt but this historic debt had not been cleared and not every country in the EU needed such a huge bail-out.
I fear that Greece would need to significantly increase the amount of tourism to base an economy on it and tourism doesn't just 'happen'; it requires significant investment in hotels, resorts, infrastructure, roads, airports and that requires borrowing and good governance!
By: charliehunt
- 31st January 2015 at 20:03Permalink- Edited 1st January 1970 at 01:00
Uncertainty and commercial disruption is the last thing a tourist economy needs however beneficial the exchange rate might be. Stability and consistency of service are crucial and Greece is a long way from offering those.
And who can blame them? After all, the Greeks are actually asking for more debt relief! And if the Greeks get substantial debt relief then why shouldn't Spain too?
By: Creaking Door
- 31st January 2015 at 21:19Permalink- Edited 1st January 1970 at 01:00
I'd hardly say that this story was being 'driven' by the media; I'm not sure how much influence the BBC has with Spannish voters or on Angela Merkel denying Greece any debt relief!
By: TonyT
- 1st February 2015 at 11:09Permalink- Edited 1st January 1970 at 01:00
I'd hardly say that this story was being 'driven' by the media; I'm not sure how much influence the BBC has with Spannish voters or on Angela Merkel denying Greece any debt relief!
And that annoys the **** out of me, why the feck is it always what Angela Merkel says, it's the EU, not the German Empire.
I don't give a flying feck if a lot of it is supposed German funding, it at the end of the day is EU funding based on what the EU draws from each Country. If the Germans can't live with that then perhaps they should do as the UK will hopefully do soon and reassess their role within the EU....
By: charliehunt
- 1st February 2015 at 11:37Permalink- Edited 1st January 1970 at 01:00
Simple. Whether they like it or not the driving economic force of the "European Dream" has been Germany. Economically it was a great success but politically always a stitch up. Without the German hand on the fiscal tiller it would be on an even worse plight.
Of course ultimately the collapse might come from the North rather than the Sourh with a core of strong nations leaving the defunct Euro to its own devices or formulating a fiscally tighter currency. Whatever happens the Germans are unlikely to cede any further controls and so weaken their constitutional position.
By: Creaking Door
- 1st February 2015 at 13:49Permalink- Edited 1st January 1970 at 01:00
I don't give a flying feck if a lot of it is supposed German funding, it at the end of the day is EU funding based on what the EU draws from each Country. If the Germans can't live with that then perhaps they should do as the UK will hopefully do soon and reassess their role within the EU...
Well, an increasing number of German voters are reassessing the role of Germany within the EU...
...and that is a big problem for Merkel.....it isn't only Greek voters that get to wield 'democracy'!
By: charliehunt
- 1st February 2015 at 14:01Permalink- Edited 1st January 1970 at 01:00
Increasing numbers yes but not a number likely to impact on the big numbers of the big parties. The Germans like the fiscal proberty they have grown up with and as long as that is not compromised the fringe will make little impact.
By: Creaking Door
- 1st February 2015 at 14:51Permalink- Edited 1st January 1970 at 01:00
Whether they like it or not the driving economic force of the "European Dream" has been Germany. Economically it was a great success but politically always a stitch up...
Actually, I'd say it was the other way round! Politically the EU has been a great success (based on 'funding' member states to work together) but economically it has been a stitch-up; the economies of 'weaker' member states only able to function based on subsidies and borrowing that they could not afford themselves without the loans effectively being underwritten (in the Euro) by the EU, and, bottom-line, Germany!
Of course, now that these states have built-up, public-sector top-heavy, uncompetitive economies based on unaffordable borrowing and the credit-crunch showed them to be what they are, their populations cry 'foul' and blame the EU for all their woes!
So, the only plan, of some of these states, seems to be to default on the EU / IMF bail-out and then come running straight back to the EU for another round of hand-outs as if nothing had happened (because even they aren't so stupid as to think that their economies work without massive EU support).
By: charliehunt
- 1st February 2015 at 15:27Permalink- Edited 1st January 1970 at 01:00
I wrote that economically it WAS a success. The inevitable has of course happened for the Eurozone back markers. The memberships of the EU and the Eurozone should not be confused.
Politically it was always a stitch up, by being a wholly undemocratic club. Most members electorates never having the chance to express their view or on the rare occasions they were their view was not accepted until they were bribed to vote the way Brussels required.
Posts: 11,141
By: charliehunt - 27th January 2015 at 16:29 Permalink - Edited 1st January 1970 at 01:00
Whatever commentators' views of the situation are the stark reality can escape no one with a modicum of interest. I suppose desperate times invoke desperate measures and one can only imagine the Greeks who voted for him believed in miracles and closed their eyes to the real world.
A train wreck of some sort is inevitable.......
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By: mike currill - 27th January 2015 at 17:10 Permalink - Edited 1st January 1970 at 01:00
Yes I think so too. The only thing that remains to be seen is how big a train wreck it's going to be.
Posts: 11,141
By: charliehunt - 27th January 2015 at 17:54 Permalink - Edited 1st January 1970 at 01:00
That will entirely depend on the level of Mr Tsipras' obduracy.
Posts: 805
By: Multirole - 31st January 2015 at 12:22 Permalink - Edited 1st January 1970 at 01:00
Greece has tourism, which is a lot like oil wealth in that nice beaches and climate is a resource that's independent of student test scores and good governance.
Interestingly oil makes up 16% of Nigerian GDP while tourism makes up 18% of Greek GDP.
If Greece had its own currency it could devaluate away, making itself much more attractive to tourists. It's the equivalent of pumping more oil.
Posts: 6,535
By: John Green - 31st January 2015 at 13:22 Permalink - Edited 1st January 1970 at 01:00
Multirole
Excellent points. What Greece would not want is any civil unrest (pace France mid 60's) that would tend to keep the tourists away.
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By: Creaking Door - 31st January 2015 at 15:01 Permalink - Edited 1st January 1970 at 01:00
Yes, Greece has tourism, but Greece has always had tourism; how does charging less (after devaluation) for something you were charging for anyway help balance the books?
It also begs the question why, even with tourism, Greece managed to get £247billion into debt in the first place? Now I know a lot of this was 'historic' debt but this historic debt had not been cleared and not every country in the EU needed such a huge bail-out.
I fear that Greece would need to significantly increase the amount of tourism to base an economy on it and tourism doesn't just 'happen'; it requires significant investment in hotels, resorts, infrastructure, roads, airports and that requires borrowing and good governance!
Posts: 11,141
By: charliehunt - 31st January 2015 at 20:03 Permalink - Edited 1st January 1970 at 01:00
Uncertainty and commercial disruption is the last thing a tourist economy needs however beneficial the exchange rate might be. Stability and consistency of service are crucial and Greece is a long way from offering those.
Posts: 9,739
By: Creaking Door - 31st January 2015 at 20:38 Permalink - Edited 1st January 1970 at 01:00
Predictably the Spannish are following suit:
http://www.bbc.co.uk/news/world-europe-31072139
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By: Creaking Door - 31st January 2015 at 20:49 Permalink - Edited 1st January 1970 at 01:00
But Germany says 'no' to debt relief:
http://www.bbc.co.uk/news/world-europe-31072321
And who can blame them? After all, the Greeks are actually asking for more debt relief! And if the Greeks get substantial debt relief then why shouldn't Spain too?
Posts: 11,141
By: charliehunt - 31st January 2015 at 21:00 Permalink - Edited 1st January 1970 at 01:00
So there's nothing new to read is there? It's all following a fairly predictable course driven by an excitable media with the BBC at the fore.
Posts: 9,739
By: Creaking Door - 31st January 2015 at 21:19 Permalink - Edited 1st January 1970 at 01:00
I'd hardly say that this story was being 'driven' by the media; I'm not sure how much influence the BBC has with Spannish voters or on Angela Merkel denying Greece any debt relief!
Posts: 11,141
By: charliehunt - 31st January 2015 at 23:03 Permalink - Edited 1st January 1970 at 01:00
Driving - no that's true but certainly riding it for all
It's worth.
Posts: 8,983
By: TonyT - 1st February 2015 at 11:09 Permalink - Edited 1st January 1970 at 01:00
And that annoys the **** out of me, why the feck is it always what Angela Merkel says, it's the EU, not the German Empire.
I don't give a flying feck if a lot of it is supposed German funding, it at the end of the day is EU funding based on what the EU draws from each Country. If the Germans can't live with that then perhaps they should do as the UK will hopefully do soon and reassess their role within the EU....
Posts: 6,535
By: John Green - 1st February 2015 at 11:30 Permalink - Edited 1st January 1970 at 01:00
Tony,
Maybe it would be better to have a picture of Angela standing in that hole !
Posts: 11,141
By: charliehunt - 1st February 2015 at 11:37 Permalink - Edited 1st January 1970 at 01:00
Simple. Whether they like it or not the driving economic force of the "European Dream" has been Germany. Economically it was a great success but politically always a stitch up. Without the German hand on the fiscal tiller it would be on an even worse plight.
Of course ultimately the collapse might come from the North rather than the Sourh with a core of strong nations leaving the defunct Euro to its own devices or formulating a fiscally tighter currency. Whatever happens the Germans are unlikely to cede any further controls and so weaken their constitutional position.
Posts: 9,739
By: Creaking Door - 1st February 2015 at 13:49 Permalink - Edited 1st January 1970 at 01:00
Well, an increasing number of German voters are reassessing the role of Germany within the EU...
...and that is a big problem for Merkel.....it isn't only Greek voters that get to wield 'democracy'!
Posts: 11,141
By: charliehunt - 1st February 2015 at 14:01 Permalink - Edited 1st January 1970 at 01:00
Increasing numbers yes but not a number likely to impact on the big numbers of the big parties. The Germans like the fiscal proberty they have grown up with and as long as that is not compromised the fringe will make little impact.
Posts: 9,739
By: Creaking Door - 1st February 2015 at 14:33 Permalink - Edited 1st January 1970 at 01:00
Agreed, but I'm not sure if it will mean that Merkel stays in the top job?
Posts: 9,739
By: Creaking Door - 1st February 2015 at 14:51 Permalink - Edited 1st January 1970 at 01:00
Actually, I'd say it was the other way round! Politically the EU has been a great success (based on 'funding' member states to work together) but economically it has been a stitch-up; the economies of 'weaker' member states only able to function based on subsidies and borrowing that they could not afford themselves without the loans effectively being underwritten (in the Euro) by the EU, and, bottom-line, Germany!
Of course, now that these states have built-up, public-sector top-heavy, uncompetitive economies based on unaffordable borrowing and the credit-crunch showed them to be what they are, their populations cry 'foul' and blame the EU for all their woes!
So, the only plan, of some of these states, seems to be to default on the EU / IMF bail-out and then come running straight back to the EU for another round of hand-outs as if nothing had happened (because even they aren't so stupid as to think that their economies work without massive EU support).
Posts: 11,141
By: charliehunt - 1st February 2015 at 15:27 Permalink - Edited 1st January 1970 at 01:00
I wrote that economically it WAS a success. The inevitable has of course happened for the Eurozone back markers. The memberships of the EU and the Eurozone should not be confused.
Politically it was always a stitch up, by being a wholly undemocratic club. Most members electorates never having the chance to express their view or on the rare occasions they were their view was not accepted until they were bribed to vote the way Brussels required.