Aren't the financial problems of Greece etc, like putting the boot in?

[PeteMorris]

I think you're misunderstanding the situation. The loans that already exist, don't have their interest rates changed; it is money that Greece is trying to raise now, on the bonds markets, for which they're having to offer ever higher interest rates to try and persuade someone to lend it to them.

 

It's equivalent to you having made a right royal mess of your overdraft, and then going to your bank and asking for a personal loan. If you get one at all, you're going to have to pay over the odds for the interest rate - probably by going to somewhere like Wonga because the bank won't touch you.

 

At the national level, people who bought Greek bonds at, say, two per cent in the past, are now worried that they won't get their money back; that makes them very unlikely to buy new bonds unless the interest rate is significantly higher, to offset part of their risk. Just as you have the option of not taking out that personal loan until you've sorted your finances out, so Greece could decline to sell any bonds if it so choose.

 

Hmmm.....yes I get your drift. I don't profess to be fully conversant with how the money markets actually work. If how you explain it is correct (and I've can't refute it one way or the other), it seems it's an unwinnable downwards spiral for Greece.

[HeadingNorth]

Hmmm.....yes I get your drift. I don't profess to be fully conversant with how the money markets actually work. If how you explain it is correct (and I've can't refute it one way or the other), it seems it's an unwinnable downwards spiral for Greece.

 

There are two political arguments about how to get out of the downwards cycle:-

 

Austerity; stop borrowing any money, live within your means, and you'll just have to put up with a rough few years until things are sorted out; OR:

 

Stimulus; yes, it's more expensive now to borrow money, but by doing so and using it to stimulate economic growth, we can get back on to an even keel and use the extra money from the growth to pay off the extra debts.

[truman]

No I wouldn't.

 

 

 

And that's why their interest rate for new borrowings is high...

[truman]

There are two political arguments about how to get out of the downwards cycle:-

 

Austerity; stop borrowing any money, live within your means, and you'll just have to put up with a rough few years until things are sorted out; OR:

 

Stimulus; yes, it's more expensive now to borrow money, but by doing so and using it to stimulate economic growth, we can get back on to an even keel and use the extra money from the growth to pay off the extra debts.

 

Stimulus is a gamble though..what happens if you borrow even more but things don't pick up? You're in a worse situation than before..

[PeteMorris]

They could always sell-off a few of their islands. I'm sure they could raise a few bob there!

[Uptowngirl]

I'm not for one minute condoning the actions of Greece or anyone else. I think I said that in my original post. But it's still like kicking someone when they're down!

 

It seems pretty claer that at some point Greece 'will' default on their loan, but if the interest wasn't so crippling, they might have a glimmer of hope in sorting it out.

 

I know if I had lent someone a fiver and I wanted 3 quid interest on it. I would rather 'just' get my fiver back than nothing at all!

 

Greece has already defaulted on it's loans. The banks have been forced to write off more than half the money the government borrowed. This is nothing to do with crippling interest rates. The rates only started to increase once it became apparent that there was a very real chance of default.

If the loans to Greece had been at zero% the country would still have defaulted. They just simply borrowed and borrowed because the governments got elected by promising spending no one could afford.

 

 

 

http://www.tradingeconomics.com/bonds-list-by-country

 

You can get 28.9% by investing in Greek bonds. But of course you will lose your shirt doing it.

 

The markets think it is twice the risk lending money to Greece than it is to Pakistan.

[studentbob]

Is their anybody out there who honestly thinks the practices employed by Goldman Sachs and their illegitimate offspring can be defended?

 

http://www.bloomberg.com/news/2012-03-06/goldman-secret-greece-loan-shows-two-sinners-as-client-unravels.html

 

I cannot believe that such scandalous predatory behaviour should not be universally condemned.

Is it because governments/regulators/BoE/ECB/Fed are scared of them?

Of course not - they are inextricably linked. Goldman rewards it's most ruthless managers with positions in such organisations where they can have direct influence on policy .

 

I for one hope the Greek people have the courage to keep voting against austerity, bring back a massivley devalued Drachma, and tell Blankfein and his financial terrorist mates he can go whistle for his non-existent Euros.

 

What's the worst that can happen?

[HeadingNorth]

I for one hope the Greek people have the courage to keep voting against austerity, bring back a massivley devalued Drachma, and tell Blankfein and his financial terrorist mates he can go whistle for his non-existent Euros.

 

What's the worst that can happen?

 

A trade ban on Greek goods, and the long-term, semi-permanent collapse of their economy.

[Brin56]

A trade ban on Greek goods, and the long-term, semi-permanent collapse of their economy.

 

The British Labour Party or 'socialist fascistic party' and it's counterpoint the British Conserervative Party, like genuine fascism require the parallel development of a sophisticated propaganda that ensures a significant degree of popular support i.e a system that cultivates fear in citizens for their neighbour, or an immigrant or a "masked protester" (which is done for self-protection from the systemic suppression) in a demonstration. The irrational fear and insecurity, which also grows and the whole sub-culture of Hollywood and television broadcasts, which are already bearing fruit in our country and Greece where, according to a recent poll, nearly 60% of people said that they "feel danger "in the abstract.

 

But when the rage of young people, who realize or even sense everything is treated with massive state repression, mass arrests, arrests and jailing, the Government and short-sighted elites behind them do not understand that the most radical elements of the new switch will not be reformist movements in the course of "left and ecology," as dreamt up by the elites. Not even the fact that most will turn to the (historical or new) anti-systemic movements (the Occupy movements,the 99-1% etc) or in who in contrast filled with fury and despair, are more likely to turn to "terrorist" organizations, which thrive in our country and Greece and which is more compatible with youthful impatience, This will be in contrast to the long uphill road to building an anti-systemic movement.

 

Clearly, therefore, that the Greek and our UK systemic crisis will continue to deteriorate in the future, even after overcoming the current financial crisis, this course will be at the expense of weaker, and the possibility of new and potentially more powerful social explosion can not be excluded in the near future.

 

Thus, in political terms, even those who were deceived in the last election and believed that the 'Condems' and Labour social-liberals like their equivalents in Greece will differ this time, you will soon discover the truth and, most of them will simply add to the many people who already abstain from political process. However, abstinence, when simply expressing a kind of protest can be easily ignored by the elites.

 

Any forms of protest can easily be ignored by the system through the means of imposing even more brutal crackdowns on demonstrations, even on riots used as a last resort. This reveals the deadlock in the activity of various libertarian organizations now actually following a path of "resistance to resistance."

 

Only once abstinence or demonstrations becames the catalyst for a mass mobilization that would aim to build a mass movement for the revival of the real meaning of a policy of self-determination by citizens in a direct political, economic and ecological democracy, with a specific political project and strategy for the political, social and world economic self-management of people will we really be opening the way to the final overcoming of this multidimensional crisis.

 

The prospects for such a development is particularly favorable to Greece and so far to a lesser extent here in the UK (so far!) , given the explosive mixture was created by the recent rise of a new radical generation, already oppressed by the system-through systemic violence (unemployment, insecurity about the future etc. .) and even physical violence, while the chances for a smooth integration of the system is almost nil.

 

 

The key, therefore, question is whether this explosive mixture will lead to a mass awareness of the urgent need for a comprehensive project anti- systemic and a corresponding mass movement aimed at equal distribution of political, economic and social power in general among all citizens, ie a truly classless society, or not.

 

In the first case, the development of such a movement could restore us to the traditional notion of politics as self-direction and pave the way way out of today's deep and growing systemic crisis.

 

 

Alternatively, the trend towards a semi-totalitarian, if not fully totalitarian, regime in Greece and the UK will become unstoppable.

[I1L2T3]

Hmmm, the best thing for these countries is for them to partially default. Their debts can never be fully repaid and it's wrong for them to drag tens of millions of citizens into the process of even trying. Start again. Start again now.

 

There was a programme on BBC2 last night that made it very clear that various Eurozone countries had a crazy debt binge since 2001. But it was also clear that they shouldn't have been lent the money on such scales. There is blame on both sides - countries and banks. The banks that lent are virtually criminal enterprises and the governments of the various countries were often corrupt as well. Wipe the slate clean and let ordinary people get on with their lives - the citizens didn't choose this and would never have chosen this if they had known what their leaders and the banks were capable of, and what the outcome would be.