Greek Turmoil: PM Backs Down on Bailout Vote
And so it begins!
The Greek people don't seem to be much keen to go
further into austerity to pay French and German banks, so I wouldn't be
surprised if the result of this is an uncontrolled Greek default, followed by
Greece exiting the Euro and a cascade of bank failures around the
world
The question is: Will governments just bailout the banks (again) or
will the Swedish example be followed?
Read the article BBC/Greek crisis: Papandreou promises referendum on EU deal
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They know that that debt is held by big, powerful banks in Germany, France, Britain, and the US. If all those banks eat that loss at once, it will make things tough all around.
Yes, they really are too big to fail. That is why investment banking needs to be regulated enough, along with the rest of the financial industry, to prevent the big blowups.
Big, small, it doesn't really matter. If you broke up the banks, then there might be several hundred smaller banks mostly doing the same things, thus getting into trouble all at once, just like the big boys now do, and with the same consequences.
Breaking up the banks is not the answer. Properly regulating the economy to keep it away from the 'poles' in the non-linear dynamic equation that represents it is what needs to be done, just as we do when we design your stereo amplifier.
Read the article DAILY BEAST/Greek referendum spooks markets
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Greece is a red herring everybody. The smokescreen line is that this is to avoid
'contagion to Italy and Spain', well don't worry about that it's already there.
This is really about all of the failed Euro economies, as they've all failed now
due to their debt mountain except Germany. When the Euro collapses these nations
will be able to blame Greece, and the truth consigned to history.
Read the article BBC/Greek crisis: Papandreou promises referendum on EU deal
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The Franco-German axis have been whipping the Greeks like dogs, and now the
inevitable has happened. The Greeks have cried "Enough!" and are turning on
their tormentors. The Laffer tax curve shows that if you try to squeeze more out
of an economy than it can give, the revenue actually falls. The Greeks should
improve their abysmal tax collection system, not impose draconian salary cuts.
Read the article BBC/Greek crisis: Papandreou promises referendum on EU deal
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I’m having trouble understanding why Papandreou is wanting a
referendum?
Why would he not at least wait until this latest plan was given a
chance to work before taking such drastic action which is surely going to end
with the population giving him the thumbs down and forcing him out of office
with the high probability of Greece leaving the Eurozone.
Of course this could be his Grand plan, as most if not all economists worth
their salt agree that even with the banks taking a 50% haircut still leaves
Greece little chance of pulling themselves out of the depths of a financial
Gehenna for generations to come if ever at all.Papandreou may realise this and
so now he is letting the people decide their own fate.
Either way, my gut feeling is that we will wake up one morning very soon with
the news that the world financial markets having imploded upon
itself.
Structures and institutions which we once thought to be impregnable
now lay symbolically in ruins across a monetary lanscape not recognisable as it
was the day before.
While the virtual physicality of such an event unravel’s
silently on Wall street monitors, the ramifications throughout the entire world
will be breath taking, if not terrifying.
So what’s the solution?………….I don’t
believe their is one.
Read the article REUTERS/Greece faces meltdown after bailout vote bombshell
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I think this is absolutely brilliant. I was really wondering how Greek
society and government could survive all the rioting and protests which will
continue as each austerity package is passed. The results would have been the
government would fall and far right and far right parties would have won – it
seems to happen like this in Europe over and over through history. The ONLY way
for this to work is for a majority of Greeks to accept the cuts. If its forced
down their throat then it will cause more problems in 5-10 years.
The referendum will allow people to stop protesting, watch the news, form
their opinons and decide. Its a horrible choice and another horrible choice. No
– Default, lose 50% of your GDP, hyperinflation ,all savings wiped out, loss of
Euro but also probably out of EU labor and trade zone. Yes – Further job
lossses, more poverty, less services.
These are the clear choices and a NO will be the end of the Eur. A Yes vote
would be a yes to the Euro. At the end of the day this was destined to happen –
one developing southern country would hit a debt trap due to a central bank and
has to really decide if the EU project is worth the pain. This is it – its
showtime. If they vote NO – the bailout would have never worked anyway.
Read the article REUTERS/Greece faces meltdown after bailout vote bombshell
"If the Euro Fails, Europe Fails" -- German Chancellor Merkel
Gap Downsizes Locally, Expands Globally
Gap is reaping what it has sown (or should I say sewn). Ever since they abandoned their biggest customer base--the Boomers-- they've been on a downhill course, searching for the ever-elusive Next Big Trend and shifting their (Third) world labor base to find the cheapest material and labor possible. Even in certain basic styles that supposedly remain the same, there are differences in fit and quality (for the worse) just within a year between purchases.
In the '90's Gap used to make great, decent quality clothes that you could wear both for and off work. They weren't necessarily cutting edge, but they were cute, functional and well priced, and I used to get tons of stuff there. Not anymore. Gap should have never changed their customer base and now they are paying the price.
Read the article SAN FRANCISCO CHRONICLE/Gap contracts locally, expands globally
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Yep,isn't much left here as another corporation gives up on the declining standard of living in the United States and looks to the burgeoning middle class in China and beyond. This is, IMHO, one of the results of free trade. How on earth do you think you can raise the standard of living in other countries without reducing it here? Free trade has not been good for the US economy in the end
Read the article SAN FRANCISCO CHRONICLE/Gap contracts locally, expands globally
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GAP used to be a consistent place to get affordable key apparel items. That changed and so did the quality of what they did sell.
They might reduce their SKUs then maintain and manage them. They paid for their vacation into poorer performance with the cash they saved reducing costs with cheaper materials, use of less material and scouring the Earth for the cheapest labor nominally able to run a seam likely to hold together until the third washing.
Ironic that a pair of GAP khakis I bought in college represent what they ought to do and have outlasted all the things they think they should be doing.
Read the article SAN FRANCISCO CHRONICLE/Gap contracts locally, expands globally
Steve Jobs - 1955 - 2011
As one of those old enough to have seen the personal computer revolution from the very beginning, I've got to say this hurts. This man has almost single-handedly created the kind of computing environment we all use today. Without Apple, we would be years behind in terms of technology, and in a very much worse place in terms of usability. I don't think there's any way to impart on today's youth just how important this man was to how they will use technology for the rest of their lives.
Requiescat in pace, Steve. There were bumps in the road, but in the end, you did about as much as a human being could in their lifetime.
Read the article ARS TECHNICA/Steve Jobs February 24, 1955 - October 5, 2011
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Steve Jobs was somebody I looked up to. Even before I switched, I recognized the man for his impeccable vision, and for the incredible willpower to get things down no matter how large the obstacle. He never learned the definition of "impossible." He never allowed the expectations of others to dictate his actions. Moreover, he never stopped moving forward. He will be sorely missed.
Read the article ARS TECHNICA/Steve Jobs February 24, 1955 - October 5, 2011
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While I was busy wire-wrapping my COSMAC Elf and making a blocky image of the ENTERPRISE shift its way across a TV, Steve was building Apple II's. I've used Apple products since the Lisa, then a long series of Macs, an iPod, the joy of watching him storm back into an Apple I thought was a sure goner, using Rhapsody for the first time, then the trecherous transition to OS X. And then there was Pixar. For most peoplel the legacy of Pixar would be a world-class legacy.
I hope his relentless pursuit of perfecting the tiny details will survive him. It's not enough to be good enough, it's in the details.
I will miss Steve Jobs. I won't see his like again. But I hope he inspires someone to be even greater. I think he'd like that a lot.
Read the article ARS TECHNICA/Steve Jobs February 24, 1955 - October 5, 2011
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I haven't posted on ars in ages but I have followed Apple's resurgence on Ars since Jobs' return. Like many ars readers I grew up with Apple computers in school and Macs later on and was rooting for apple even when it seemed like a lost cause. So Jobs' death has a surprisingly personal significance for that reason.
Also I found Steve Jobs inspiring because of his passion for technology and what it could do for us and for his dedication to doing great work.
A favorite Jobs moment: during the original iPhone introduction at one point Jobs says "I didn't sleep a wink last night." I love that image of a big corporate leader expressing this genuine almost childlike excitement about the new gadget he was showing off. It's hard to imagine any other CEO saying something like that. (Just like it's hard to imagine any other CEO of a big company weighing in on designs for product packages or icons.) In addition to the tech vision, it's that passion for the actual product that set Jobs apart.
He will be missed.
Read the article ARS TECHNICA/Steve Jobs February 24, 1955 - October 5, 2011
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Anything I say would just be superfluous at this point, but I'll say it anyway:
Steve Jobs was about as polarizing a figure as the tech industry has ever seen. It's been my observation that the most polarizing figures are often the most brilliant, passionate, and unrelenting in their craft, as well as life in general. I'm very much a Microsoft guy, but I can't help but recognize and deeply appreciate the unconventional, personal approach Mr. Jobs took with Apple. A company that was on the verge of becoming a mere footnote in tech history, instead became synonymous with quality, usability, style, and almost disturbingly awesome foresight... no small feat.
Steve, you thought differently. Where others thought straight, you thought sideways. When others couldn't quite understand the problems, you were clearly elucidating the solutions. Forget the tech industry-- the world was a better place because of you. May the good Lord bless you, and may he make extensive use of your exceptional expertise.
Read the article ARS TECHNICA/Steve Jobs February 24, 1955 - October 5, 2011
No other company has successfully changed from "committee corporate" culture
to "Steve's way".
Steve's way was "No committees, my way or the highway" where the word of the
person _RESPONSIBLE_ for a particular item was final and mandatory down the
command chain.
In your average corporate you have the headless beast known as the committee
"responsible" for every decision at every step. Other companies look at Apple,
have a committee driven reorganisation to attempt to imitate it and perform a
musical chairs committee rehash to result in another committee structure which
is not any closer to Apple's.
The only other big company with top-bottom "my way or the highway" culture
out there is Oracle where it predates Steve's second reign at Apple.
Apple did not shape the world in its image. It has shown the world a shape it
can attain. The world however is nowhere near attaining it. Also, the bets are
still off if Cook possesses the Genghiz Khan syndrome necessary to continue to
run Apple the same way. If he does not, Apple will descend back to where it was
in the interregnum when the MBA committee's ruled the way it was run.
Read the article THE REGISTER/Apple cofounder Steve Jobs is dead at 56
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I'm rather moved by his death as my first three computers were Apple machines
those being an LC630, iMac G3 (lime green), PowerMac G4 MDD SP and not to forget
my iPod classic, the best MP3 player ever created you can't deny that. To have
taken a company from literally rock bottom to sky high, noone can discount this
man's achievements regardless of what side of the fence you sit on.
I may not
have approved of the direction in which he took Apple from being somewhat
underground to a household brand name but he was a technology revolutionist, a
man with ambition, a font of inspiration. His death for me has hit home more
than I would've predicted and makes me question one's own mortality. What kind
of legacy will we leave behind?
Read the article THE REGISTER/Apple cofounder Steve Jobs is dead at 56
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I think the best way to describe his role was as a conductor - he knew how to
get the right team around him and motivate them to deliver his vision. And it
was a multifaceted vision - produce easy to use good looking stuff, make a ton
of money and keep complete control. Sure the technology wasn't always innovative
as he claimed and the approach to business was sometimes a tad unethical but
somehow the package was often much more than the sum of the parts.
Whatever you think of the resulting products (I loved some of them, hated
others) - I think the world is poorer for no longer having Steve in it.
I've used many computers in the last 20 years (Unix, Windows, SGI, Amiga,
Mac) - but playing around with using MacDraw for DTP in 93 was when it clicked
just how revolutionary computers could be as a creative tool. Before then my
only experience had been DOS and WordPerfect - and so a tip of the hat to you,
Steve, for providing the initial inspiration.
Read the article THE REGISTER/Apple cofounder Steve Jobs is dead at 56
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A short Apple-related anecdote:
I live in Japan, where I teach English at elementary schools and junior high schools for a living. At today's elementary school there's a little girl named Nanako, about 7 years old, one of the special education students. I haven't taken scientific measurements, but I believe she's possibly the sweetest kid in existence. If I'm in the teacher's room, and she comes by and sees me, then I'm going to be hugged, regardless of what my plans were. I don't get a say in the matter ;)
She's been unusually downcast the past couple of weeks, apparently because of a semi-serious fever that she recently recovered from, that had kept her from school for an extended period. Anyway, last week I used a fairly cool little music app on my iPad that lets you record really short video clips, and then use them on a grid as a touchscreen percussion/sample pad. In a couple of minutes I made a silly little mix using clips of us making weird sounds together.Nanako couldn't get enough of it, and couldn't stop laughing. It put a massive smile on her face, and she was totally fascinated, touching the screen and seeing the sounds and videos play. She was pretty solemn again today, so I loaded it up and let her play around with it, and within about 10 seconds she was grinning again.
A reminder that tech is only as good as its human connection.
Read the article BOING BOING/Steve Jobs has Died
Hallmark Moment : "Sorry You Lost Your Job..."
That's pretty sad considering the price of Hallmark cards these days. Nowadays it's cheaper to buy a whole magazine than it is to buy one card, you may as well buy the newly unemployed person a magazine they can read on their off days.
Read the article GLOBE AND MAIL/Hallmark introduces job-loss sympathy cards
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Why is it, in a so-called economic downturn, that no Hallmark card shops close? Other retailers, restaurants, car dealerships, and entire malls shut their doors, but Hallmark stores stay open.
There is nothing in any Hallmark store that anyone really needs, yet it’s BAU in a recession.
Forget about successive quarters without growth, the number of unemployed, jobs lost or created: Hallmark should be the hallmark. When Hallmark stores close, times are bad; until then, there must be plenty of discretionary income, so quit whining and find out how to get your hands on some of it.
Read the article FOX NEWS/Hallmark Makes Layoff Greeting Cards for Customers
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Hopefully the cards don't say "printed in China" on the back. That would be a real punch to the gut.
Read the article GLOBE AND MAIL/Hallmark introduces job-loss sympathy cards
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The loss of a job is like the loss of anything in life - it's important to grieve it and feel supported while dealing with the change.
Most people don't know what to do but avoid the person they know who has lost their job. Usually this is because they feel bad for them or don't know what to say, or feel guilty for still having a job. Of course, the person who just lost their job may feel isolated because of this - just at the point where they could really use a hand and some support.
If a card helps show support to someone during a hard time, I am all for it.
Read the article GLOBE AND MAIL/Hallmark introduces job-loss sympathy cards
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We all have a different perspective. My mother used to say, "Things work out for
the best." I see the loss of a job as an opportunity to move on to something
better. Since humans tend to be creatures of habit, going to and from work
everyday is just a habit. There are good days and bad days. Some people at work
are nice and some are not. Loosing your job is an immediate shock. It's probably
unplanned and unexpected. Receiving a card about your job loss shows there's
someone out there who cares enough to send a card.
By the way, aren't
there cards that congratulate you on your divorce?
Change is good!. The
only thing in life that's constant is change!
Read the article CBS NEWS/Job loss greeting cards: Kind or out of place?
What the Recession Means for Young Adults
"I would like to thank the Baby Boomers, who's parents sacrificed a lot for them
and took that lesson to sacrifice their children for profit."
You are
blaming the WRONG PEOPLE. The baby boomer generation is who built up the economy
to the point where were able to have near full employment. It was the boomers
who fought the old prejudices to extend economic opportunity to women and
minorities.
Those who caused the economy to crash were not boomers. They were
mostly greedy, selfish "what ever I want is all that matters" Generation Xers.
I'm sick to death of my generation being blamed for this and all our other
social woes. No doubt, we must admit our mistakes.
And, as far as I can tell,
our biggest mistake is that we didn't raise our children with the same value
system that we have, but allowed them to be coddled, self-important,
ill-prepared whiners, who only care about themselves and what will be handed to
them on a silver platter.
Read the article NPR/Census: Recession Taking Toll On Young Adults
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The impacts on young adults are tragic and severe, but it's a mistake to think
that their problems are limited to them. The story hints at this.
The
economic crisis is linked to the housing crisis of declining values. With the
younger generation increasingly unable and unwilling to move into home
ownership, there is no DEMAND basis for house prices to rise and there won't be
for some time unless dramatic action is taken to create jobs.
We are all
interconnected. Throwing the young under the bus (which we are also cutting
funding for) by trying to balance the budget DURING the crisis, instead of AFTER
the crisis, will come home to roost for older homeowners as well.
Whether
they appreciate that before it's too late is largely up to them.
Read the article NPR/Census: Recession Taking Toll On Young Adults
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The fix is in. It's just taking a while for most Americans to accept it for what
it really is: the end of US manufacturing. Under Republicans US corporations
have moved at least 16 million jobs over seas. Why? Because of the obvious
reason: Profits but also because of a not so obvious reason as well... they are
making a shift to the USA being the purchasing capital of the world and not the
producing capital. Just as England became a "nation of shopkeepers" 150 years
ago so will the USA over the next 5-10 years. Those who hold patents and
licensing rights to products will be rich forever, those who do not will
struggle to consume the plastic crap made around the world.
One part of
the issue above overlooked is the amount of young people leaving the USA. I know
of at least 20 websites of US expats that have moved to Brazil that have sprung
up in just the last 2 years. For every site there are dozens of other expats
that regularly comment. That's just 1 country that doesn't even speak English!
Look for those who've moved to Britain, Australia, Ireland, Belize or a Germanic
country. There are literally hundreds of sites of expats living in Spain, Italy,
Sweden/Norway and even Chile/Peru. Those who can are getting out in droves.
Read the article NPR/Census: Recession Taking Toll On Young Adults
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Setbacks. In a nation that rewards the accumulation of wealth from wealth and
not from labor the rich will continue to get richer and the poor, poorer. The
poor will also get angrier as more jobs and capital are sent overseas, making
their situations worse. And who could blame them? They live in a democracy,
based on representative government. But when their representatives do nothing to
protect their interests they will, of course, feel alienated and powerless,
unless they take power into their own hands, just the way the first American
revolutionaries did.
I am afraid that as the gap between rich and poor
continues to grow civil unrest is coming to this country because our
representatives are failing us. Our national economy must return to a
public-interest based economy, for the good of country because what is good for
our people *is* good for our country. The two cannot be separated any further.
If nothing is done, the endgame will take us back to where this country
started – to a bloody struggle for a fair voice and representation in
government. This country is on the wrong track. If something isn't done soon for
average Americans, how long will it be before the entire train derails?
Read the article NPR/Census: Recession Taking Toll On Young Adults
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I am in my 20s, male, college degree, and greatly underemployed (yes, I understand that I am the lucky one). Many other people around my age are unemployed FORMER Obama supporters (as was I). We all had high hopes in the potential our college professor style president could offer us. Sadly, we have lost a large portion of our ideals and really care about our lives. We are soldiers and businessmen, political and apolitical, hard workers and lazy workers (although all lack work). I hope that my generation's economic misfortune helps us become like the greatest generation, but right now ideology is lost and reality is upon us. We want jobs. We don't want unemployment benefits, welfare checks, food stamps; however, we want to contribute to society. How do we do that in the current atmosphere?
Something has to change. I'm sorry if your partisanship makes you hate my post, just realize that this is how we feel. Our greatest concerns are not with the expanding gay culture (we are the largest supports of that culture), it is not with universal health care for every man women and child (we understand that it is wrong to let people sick die miserable deaths), what we want are opportunities.
As a nation, we will be suffering from the loss of work for my generation in the years to come.
Read the article POLITICO/Census: Young hit hard by recession
Fear and Loathing in the European Banking Zone
Get ready for another dose of capitalism for the poor (austerity) and socialism for the rich (bailouts).
Deutsche Bank's CEO Josef Ackermann remarked on Monday, "...it is an open secret that numerous European banks would run into trouble were they forced to write down their sovereign bond holdings to reflect current market value."
I'll translate this into Main Street English: Some major banks in Europe are actually insolvent, and this may become apparent to everyone in a sudden and catastrophic way before the authorities have time to figure out a band-aid bailout.
Read the article NEW YORK TIMES/
In Euro Zone, Banking Fear Feeds on Itself
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Iceland has the right idea. Write off the "debts" and write off the corrupt institutions that allowed criminals to legally steal.
Let's face it, at the core, this is all about legalized larceny! The people who perpetrated this had the attitude and mentality of thieves playing at a fixed casino. This was not about rational investing, but rather it was about "making a killing".
By allowing the doctrine of "too big to fail" to become some kind of absolute....we only perpetuate the corruption and put off the eventual day of reckoning.
Our global financial system can not survive ever escalating boom bust cycles that only serve to enrich a relatively tiny number of predators while destroying the real wealth of the vast majority of investors and taxpayers. The current way we do business is not sustainable.
The would be "masters of the universe" are just sick puppies locked into a hoarding thieving pathology.....they are no more "successful" than a malignancy that also "grows".
We need to cut our losses and change the whole paradigm that governs our financial affairs. There is nothing creative or constructive about dishonesty and theft...no matter how slick the rhetorical/"legal" packaging.
Read the article NEW YORK TIMES/
In Euro Zone, Banking Fear Feeds on Itself
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I'm not an economist (thank God) but have long talked with my friends about WHERE the collapse of the world economy would begin. My thoughts are that old Europe is first to go followed by Obamaville, Japan and then the rest of the planet. There simply isn't any real money out there to cover the short falls we have created.
We've played smoke and mirrors for so long that salvation is going to be a cathartic economic cleansing (i.e. a depression). We start over and we hopefully learn from our mistakes - no more big government, pay as you go for all governments and minimal taxes and controls on business.
Socialism simply doesn't work; you have only to look at countries of the former Soviet Union and old Europe (Greece, Spain, etc.) Buckle-up, it's going to be a rough ride.
Read the article NEW YORK TIMES/
In Euro Zone, Banking Fear Feeds on Itself
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It is GAME OVER!
The banksters and their puppet governments, both in Europe and the U.S. have been papering over this debt crisis for more than 3 years with bailouts and accounting tricks. Well, it seems that smoke and mirrors can only cover up insolvency for so long.
To my fellow U.S. citizens: Please do not let panic overcome your rational thinking. This economy desperately NEEDS massive de-leveraging and the bankrupt financial institutions must come clean and actually go through bankruptcy.. This debt and insolvency is the boat anchor holding back our economy. Had this been allowed to happen 2008, we would NOW be experiencing an economic recovery.
This is going to be a rough road, but it's a path that we absolutely MUST take for the long term health of the economy. The road of bailouts, accounting games and massive government deficits smooths out the short term, but there's a cliff at the end.
No more bailouts, no more accounting games, no more stimulus
Read the article HUFFINGTON POST/European Bank Failure: Investors Fear Possibility Of Another Lehman Brothers
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How is it that we ordinary folk on the ground have seen this mess coming for years yet our politicos and their bankster friends haven't? It wasn't so long ago that the Establishment and mainstream press were lauding Gordon Brown as the best Chancellor we ever had. His friend, Times economist Anatole Kaletsky, wrote an article in 2008 refering to "the depression that never was".
Well, now everyone is waking up to the reality but 3 years further on and with a pile more debt to deal with. We urgently need Marshall Plans to rebuild our indebted Western economies with a strategy of making work and thrift worthwhile. It will mean hard choices, going far further than the token austerity rhetoric from George Osborne. Otherwise we will witness social breakdown and reactionary authoritarian Govt across the indebted West as society becomes evermore polarised between a client state and the global rich.
Read the article TELEGRAPH/Is the world doomed to suffer another Depression?
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Its all very simple really. Marx was an idiot when he said communism will win but he was bang on when he said capitalism will eat itself. He noted that the middle classes will be squeezed into slavery a century ago.
When you have CEO's paying themselves bonuses up 170% in ten years on stock growth of 20% its obvious someone has to pay. When you have oligarchs asset stripping whole eco structures and continents to buy football teams and furs for their mistresses you have a problem. When you have the human race breeding faster than rats on one measley planet you have a disaster. As I said its all very simple really. All the rest is just hot air!
Read the article TELEGRAPH/Is the world doomed to suffer another Depression?
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This is just the beginning I suspect.Unlike some here , I do not come here pretending to be some kind of an expert in the situation. I can only say what I see.What I see is the fake bodies such as the IMF saying austerity has failed it is time for something else? Something else? like what? I can only presume the lady who was shoe horned into that position as head of the IMF at the poor Mr Khans expense, must mean the opposite of austerity.Spendy spendys.
This total madness tells me that it is abandon ship, austerity has served its purpose, lining somebody elses pockets of course.Now it is time for calamity.Hold on to hat, it is party time.
This will bring out the worst in the politicians, who we must now surely know, are at least the worst kind of liar.
What outrageous power grab or similar will transpire and will the brain dead western population even notice, because I am convinced we are living under a strange oppressive misinformation being peddled about virtually everything.Just take a cold hard look at our country and government and especially Europe.
Read the article TELEGRAPH/Is the world doomed to suffer another Depression?
READ MORE COMMENTS: SEPTEMBER 2011
Debt is fine until the growth stops. Just ask any PE firm, or anyone who kept re-fi'ing cash out of their house as the value increased. No different for countries / governments, whether it be Greece or the US.
When the growth engine stalled in the US and Europe in 2008, the debt instantly became unsustainable. Costs need to be cut, but cost-cutting alone can't do the job. Private sector growth is the only viable solution, because paying off the debt isn't possible. Maybe the rest of the world could band together and come up with enough to pay off much of Greece's debt, but Italy, Spain, Belgium, and France (let alone the US) won't be so easy.
Yet throughout this entire Euro-debt "crisis", one never hears the term "private sector growth".
With each passing day, I'm coming to believe that most (if not all) of the Euro leadership doesn't want to really solve this problem. Instead they want to deepen the crisis to the point of meltdown, then nationalize the banks -- allowing the govts to hold all that bad debt without having to mark-to-market. A huge win for power-hungry politicos; a disaster for the people of those countries.
Read the article WALL STREET JIOURNAL/How the Euro Zone Can Restore Confidence
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A little reform is only going to delay the day of reckoning. When I was a kid growing up, I asked my grandfather who'd emigrated from present day Slovakia about the old country. He told me I shouldn't concern myself with that "G-D place." He was right.
A century later, after gulags and concentration camps and two needless wars, Europe's brains and ambition have either emigrated or been slaughtered.
They're going through what thirteen colonies went through under the Articles of Confederation, but they have no Washington's or Hamilton's or Jefferson's or Madison's to show them the way.
Read the article WALL STREET JIOURNAL/How the Euro Zone Can Restore Confidence
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This is just another case of *save the rich, because they got too greedy.
Europe, Japan and the United States all handled the their real estate/ financial crashes the same way, saving the rich/banks and asking their citizens to pay for it.
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Iceland handled their greedy bankers another way. They let them fail and now most of them are in another field of work. They are not in a recession and doing quite well.
There is no chance of our leaders following Iceland's example because the rich/bankers "own" the politicians, who are more concerned about winning favor or retaining power than about fairness
Read the article CNN MONEY/Why you should be worried about Europe
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Italy as matters currently stand is not rescuable. The economy has been stagnant ever since I came to live here a decade ago. The government isn't willing to make the changes that are needed to bring growth and create a sustainable budget. The politicians are too busy profiting from being in power, not to mention that Berlusconi's more interested in staying in office than he is in governing the country.
Italy has huge tax evasion and a huge mafia economy: the government's not trying to attack either problem. Thay're not instituting reforms that would actually help commerce,such as eliminating the office of the "notaio". Instead, they're cutting services, which hurt a lot of people, and raising taxes, which hurt the tax-paying part of the population, salaried workers in particular. Italy needs to reform. If it gets rescued by the EU, that will only permit it to continue its dysfunctional ways.
Read the article NPR/As Danger Looms, No Deal Yet On Euro Crisis
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The EU countries have what they call the "Stability and Growth Pact". It suggests 3% deficit spending and a target debt-to-GDP ratio of 60% as sustainable goals. And that's probably true when the economy is tracking along positively. However, if you're at 60% debt-to-GDP and all of a sudden the economy goes in the tank, then you don't have a lot of flexibility regarding fiscal policy. And then it's a few wrong moves and you're over the cliff. Keep the debt-to-GDP around 30-40% (and averaged over 10-15 years by the way) and you can adjust and have a better shot at weathering the down years.
Public debt to GDP ratios:
Greece 182%
Italy 120%
Spain 65%
Ireland 112%
Portugal 102%
Germany 66%, projected to reach 83%
France 87%
UK reports vary from 149-240%
Japan 225%
United States 65-70%
Read the article NPR/As Danger Looms, No Deal Yet On Euro Crisis
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The United States of Europe has never been a reality and never will be. The reality is that Europe has too many divisions that have been since the beginning of man-kind. The problem is which the merchant mentality that says that money solves all problems and the politicians that listen.
Culture is the last word even though cultures use money they want to money to maintain THEIR culture. Thus seeking to take away the money is equated to attacking their culture and life-style. So the divisions were covered over by monetary promises that forget that culture comes first. They've tricked the world into believing in One Europe as though they were one big happy family. Now the reality is ONCE AGAIN coming to the surface. It was all just smoke and mirrors, the "Eurozone."
Read the article NPR/As Danger Looms, No Deal Yet On Euro Crisis