Greek Gov Ready to 'Shave' Bank Accounts

[Tilted]

I'm holding out hope for the Greeks!!!! "#### EU! #### EU!!!"

Me too, so that the EU can respond with... Okie dokie, if that's the way you want it. But just so you know, that dude you've got bent over the rail with his pants down, that's not the EU. That's yourself. You kids have fun now.

 

[Tilted]

Why is it every time I read Greece, Goldman Sachs and General Motors come to mind?

The beginning G?

 

[This_person]

The beginning G?

Must be it.

 

[Larry Gude]

Me too, so that the EU can respond with... Okie dokie, if that's the way you want it. But just so you know, that dude you've got bent over the rail with his pants down, that's not the EU. That's yourself. You kids have fun now.

Yeah, you say that now. Just you wait. When my buds get their act together and un #### themselves, why, they could change the WORLD for the better!!!!

 

[Gilligan]

The political meltdown is underway....this ain't over yet.

http://abcnews.go.com/International/wireStory/greece-tsipras-faces-dissent-bailout-deal-32430791

 

[BOP]

At least us drunken sailors quit when we ran out of money.

 

[Tilted]

Yeah, you say that now. Just you wait. When my buds get their act together and un #### themselves, why, they could change the WORLD for the better!!!!

That's part of what I'm hoping for.

 

[RPMDAD]

Ok, from a local perspective. My buddy who is Greek, and lives just outside of Athens described this to me. He does not work for a union, or the Greek Govt. and does not receive a pension. He said the unemployment rate in Greece is 27% and growing with the financial crisis, and said he already pays 50% of his income to taxes. Now the Greek Govt. may be well out of control on spending, but trust me the average hard working Greek citizen has been getting screwed for years.

 

[Tilted]

Ok, from a local perspective. My buddy who is Greek, and lives just outside of Athens described this to me. He does not work for a union, or the Greek Govt. and does not receive a pension. He said the unemployment rate in Greece is 27% and growing with the financial crisis, and said he already pays 50% of his income to taxes. Now the Greek Govt. may be well out of control on spending, but trust me the average hard working Greek citizen has been getting screwed for years.

That's part of the problem, there aren't enough "average hard working Greek citizen." That 27% unemployment rate is on a labor force participation rate in the low 50s, yielding an employment to population rate that's below 40% right now. That's terribly low as compared to other developed and other European countries. And though the unemployment rate is unusually high right now, the labor force participation rate being so low isn't a product of the recent economic problems. According to the World Bank [EDIT: I'd previously mistakenly said the OECD] Greece hasn't had a labor force participation rate above 54% going back at least as far as the beginning of the 90s.

Greece has a lot of problems: not enough people working, too much make-work (though some of that has been cut out lately), low productivity, over reliance on domestic consumption (both public and private) to drive growth, onerous business regulations and taxation, built-in curbs on competitiveness, too low retirement ages for certain kinds of workers.

And it seems some of them are quite wiling to excuse their general and unrealistic expectations regarding work. I recall an interview I saw a month or so ago with a Greek guy on the street. He was being asked if he thought it was reasonable that certain kinds of workers were allowed to retire with full benefits at some crazy young age (it's been a while, and all of these interviews that I've seen blend together after a time, but I want to say it was in the early or mid 50s). He said, basically, yes - that was reasonable, they were entitled to retire young because of how stressful their jobs were. What position was he referring to? IIRC, bank teller. He thought that job was so stressing that it was reasonable for them to get to retire in their 50s. Of course, one Greek person from the street being interviewed does not a widespread national attitude make, but other evidence suggests that such attitudes are held by a fair portion of modern Greeks. Too many of them are retired and living on pensions. Too few of them work, leaving those that do to work perhaps too hard or too long but still not being sufficiently productive to support the nation.

I tried to find a report I read last week (or read part of, it was too long and detailed for me to read the entire thing) that went through many of the problems with Greek regulations relating to commercial enterprises - e.g., how the number of people working in certain professions (or businesses offering certain services) was limited by law thus eroding competition and innovation and artificially driving up prices. I've misplaced the link to that report, I want to say it was from the IMF but I don't recall with certainty now. If I can find it again I'll post it, but in the meantime here are a couple of other reports that help paint the picture when it comes to the systemic problems with Greece and its general productivity: OECD Employment Outlook 2015 and Greece 10 Years Ahead.

Note: There are different ways of measuring things like employment to population rate, so you might see quite different numbers for such things. The key, or one key, is comparing countries to each other using the same methodology - the same way of measuring them.

 

[GURPS]

- in return for continuing to give Greece the financial aid it needs - should demand austerity from Greece, that that is reasonable, that Greeks need to come to grips with the reality that the problem is they don't do enough work, they aren't collectively productive enough, to support the collective lifestyle they want. They have to change, they have to not be so spoiled - so the rest of Europe has to stop indulging them and facilitating their disconnect from reality.

Tilted;

Larry is stuck in wipe out the debt ... can cannot see the dysfunctional system for what it is

just keep giving them more money ... no strings attatched

 

[Gilligan]

That's part of the problem, there aren't enough "average hard working Greek citizen." That 27% unemployment rate is on a labor force participation rate in the low 50s, yielding an employment to population rate that's below 40% right now. That's terribly low as compared to other developed and other European countries. And though the unemployment rate is unusually high right now, the labor force participation rate being so low isn't a product of the recent economic problems. According to the World Bank [EDIT: I'd previously mistakenly said the OECD] Greece hasn't had a labor force participation rate above 54% going back at least as far as the beginning of the 90s.

Greece has a lot of problems: not enough people working, too much make-work (though some of that has been cut out lately), low productivity, over reliance on domestic consumption (both public and private) to drive growth, onerous business regulations and taxation, built-in curbs on competitiveness, too low retirement ages for certain kinds of workers.

And it seems some of them are quite wiling to excuse their general and unrealistic expectations regarding work. I recall an interview I saw a month or so ago with a Greek guy on the street. He was being asked if he thought it was reasonable that certain kinds of workers were allowed to retire with full benefits at some crazy young age (it's been a while, and all of these interviews that I've seen blend together after a time, but I want to say it was in the early or mid 50s). He said, basically, yes - that was reasonable, they were entitled to retire young because of how stressful their jobs were. What position was he referring to? IIRC, bank teller. He thought that job was so stressing that it was reasonable for them to get to retire in their 50s. Of course, one Greek person from the street being interviewed does not a widespread national attitude make, but other evidence suggests that such attitudes are held by a fair portion of modern Greeks. Too many of them are retired and living on pensions. Too few of them work, leaving those that do to work perhaps too hard or too long but still not being sufficiently productive to support the nation.

I tried to find a report I read last week (or read part of, it was too long and detailed for me to read the entire thing) that went through many of the problems with Greek regulations relating to commercial enterprises - e.g., how the number of people working in certain professions (or businesses offering certain services) was limited by law thus eroding competition and innovation and artificially driving up prices. I've misplaced the link to that report, I want to say it was from the IMF but I don't recall with certainty now. If I can find it again I'll post it, but in the meantime here are a couple of other reports that help paint the picture when it comes to the systemic problems with Greece and its general productivity: OECD Employment Outlook 2015 and Greece 10 Years Ahead.

Note: There are different ways of measuring things like employment to population rate, so you might see quite different numbers for such things. The key, or one key, is comparing countries to each other using the same methodology - the same way of measuring them.

Knowing all of that ^^^^ is why I kept pushing back on Larry's insistence that the Greek economy would be just fine if their debts were discharged. I knew better.

 

[Tilted]

The Greek parliament has passed what it needed to to put the ball back in various other nations's courts, or their legislatures as it were. That it would was reportedly a near certainty in the previous 24 hours. So now we'll have to see if the German parliament will play along, and whether the IMF will (successfully) through a monkey wrench into the deal as it seems to be intent on doing.

 

[Larry Gude]

I can't believe greece is giving in like this.

Do you know, physically, where all the Drachma are? Destroyed?

 

[Tilted]

I can't believe greece is giving in like this.

Do you know, physically, where all the Drachma are? Destroyed?

I don't know for sure, but I suspect the bulk of the physical currency was destroyed. They'd have to find some printing presses and get to work.

Though going back to the Drachma may have been an option, it would have been a last resort of sorts - just so much short-term downside for Greece in that. Nobody would have believed in the Drachma's ability to hold its value. Greeks would have ended up, in effect, paying a huge premium for anything they purchased from outside the nation. That problem would have been in addition to all of the typical internal problems associated with an unstable currency. And forget about them being able to issue Drachma-denominated debt, that would have been a non-starter. At least, it wouldn't have been possible under anything other than unmanageable terms - not to the extent they'd have hoped to be able to sell that debt to outsiders.

As for Greece giving in (through its parliament): Prime Minister Tsipras' quite liberal party had won enough seats to control the (coalition) government, but less liberal parties still held seats in the Hellenic Parliament. And by less liberal I mean those that were already willing to accept a harsh deal including substantial austerity requirements. I don't know how the vote broke down, but this deal could probably have passed even with considerable opposition to it from within PM Tsipras' own party.

After negotiating the deal, and failing to deliver what he had promised the Greek people if they'd vote no in last week's referendum, he (reportedly) essentially said he didn't believe in the deal. But... he said it was the best they were going to be able to get, that they'd gone to the mat so to speak and thus now knew they'd done the best they could. He apparently reframed the issue such that, now, agreeing to the deal was the way to show defiance - basically saying that Greek's foes would like nothing more than to have them reject the deal (and thus have to leave the EU?). There were protests yesterday and I'm sure there will be more, but the adults in the room knew that not agreeing to this deal would have meant great pain for the Greek people - pain even greater than what they've experienced in recent years.

 

[Gilligan]

. Nobody would have believed in the Drachma's ability to hold its value. .

Exactly. As has happened numerous times already throughout history..they'd be taking wheelbarrow loads of paper to the store to buy a loaf of bread.

I note that the anti-austerity riots have started..big time.

 

[Larry Gude]

You guys are stupid.

Look it, here's what they do; They simply make a bunch of Greek Credit Cards and extend everyone a credit limit for the month. Whatever the average wage is, adjust for the unemployed (if they make $12 a year, half don't work then the card is good for $6 a year/$.50 a month) and this gets everyone credit AND motivation to go earn more.

With credit cards, you don't need cash and you don't need anyone buying the debt or back it up. You just declare it and it will sink or swim on everyone's faith in it. If TARP taught us nothing it is that you can just make it up.

If foreign entities won't accept the card, that's their problem. It will create demand IN Greece BY Greeks to supply.
They dive into existing debt and issues and rules and simply adjust and change Greek banking laws, on the fly, to keep everyone whole.

The pain can be at the direction of the Germans OR it can be pain dedicated to a whole new Greek CONTROLLED economic model so that anyone who needs to go to work, pay a bill, will be doing so at the behest of his fellow countrymen; not the EU and, for damn sure, not Germany.

Greeks can pull together and make the 'pain' mean something OR they can knuckle under and still be in the same shape; beholden to the EU.

The real risk here is Germany's. They're the ones that fear a EU break up the most as they have the most wealth accumulated. They don't wanna take my advice and write off a few bucks, which they have, then charge more interest and let that motivate Greeks to restrict borrowing while trade, that very much works to Germany's favor, simply goes on? Fine.

The Greeks CAN change the world. For the better. Or keep on the path they are on and just watch Greece fade away and become the little EU state with the nice Islands.

Attica! Attica! Attica!

 

[Gilligan]

Y
The Greeks CAN change the world. For the better. Or keep on the path they are on and just watch Greece fade away and become the little EU state with the nice Islands.

You very funny guy.

Oh..and those nice islands?....going up for sale.

 

[Larry Gude]

You very funny guy.

Oh..and those nice islands?....going up for sale.

You are Satan.


Actually, that's my hope, that when they start to find that the Germans are serious, they want the title to everything, maybe that will get them to what they need to do!!!!

 

[Gilligan]

You are Satan.


Actually, that's my hope, that when they start to find that the Germans are serious, they want the title to everything, maybe that will get them to what they need to do!!!!

ah ha ha haaaa!!....no..stop..please...i'm dying' here. You playing this joint all week? Where's the tip jar?

 

[Larry Gude]

ah ha ha haaaa!!....no..stop..please...i'm dying' here. You playing this joint all week? Where's the tip jar?

Ha. You think I'm kidding, eh? Well, that is the TRUE beauty of electronic banking and fiat currency; wheel barrows full of cash for a loaf of bread is not a reality. If they make the cards (easy enough) and simply manage the software end of it and adjust balances as they see fit, this could be the DUMBEST thing Germany has done since declaring war on us. Which was the dumbest thing they'd done since trying to get to Moscow. Which is the dumbest thing they'd done since trying to bomb the Brits into compliance.

The ONLY thing that matters is that they control the system. From there, they can call the balances whatever they like. There will be no inflation because, with NO currency, no ability for anyone to demand more and more hard currency, it will all work out just peachy. Even if someone starts demanding 10 times what the old price was, all of that can be back tracked in the system because it's ALL digital. The ONLY thing that matters is that the transactions go through and they CONTROL that!



EOTWAWKI

Gyro economy!!!!!