Scraping through? | 70 comments (70 topical, editorial, 0 hidden)

Re: Scraping through? (none / 0)

Quotes from the actual press conference speech, mostly relayed by business/markets media, stress the offer of cohesion funds to Greece:

Barroso suggest swift extra EU funds to help Greece now -- EUbusiness - legal, business and economic news from Europe and the EU

"I'd like to ask the European council to discuss what we can do to assist Greece beyond its consolidation efforts to enhance competitiveness and address the urgent problem unemployment," Barroso said at a news conference.
Greece had the potential to access European monies under the European Union's cohesion policy, he said.
"We should concentrate these funds on where it matters most now, on improving competitiveness and employment. We should cordinate them, find a way to frontload and accemlerate them so that Greece gets the benefit now," he said.

EU Commission says Greece should get help accessing billions of EU development funds - News1130

Greece has been unable to access billions of euros in EU funds designed to boost development in the bloc's poorer regions because it can't co-finance projects and prove that it can use them effectively.
Barroso said that the EU could accelerate payouts and frontload some projects, which could give Greece quick access to some €1 billion to help make its businesses more competitive and boost employment and training. That's only a small fraction of the €15 billion or so Greece could still get from the EU until 2013.

by afew (afew(a in a circle)eurotrib_dot_com) on Tue Jun 21st, 2011 at 10:07:31 AM EST
[ Parent ]

Re: Scraping through? (4.00 / 2)

The offer of cohesion funds is not an offer of additional cohesion funds, it's an offer to front-load the disbursement of available cohesion funds. So, what is being proposed? To give Greece all the cohesion funds for 5 years in just one year so they can give it to the banksters?

Economics is politics by other means

by Migeru (migeru at eurotrib dot com) on Tue Jun 21st, 2011 at 10:25:22 AM EST
[ Parent ]

Re: Scraping through? (none / 1)

Is Barroso concerned that the ineffectual measures foisted on Greece will simply precipitate a Greek default, and therefore take down Portugal immediately?

Is Barrosso concerned about Portugal?

by Upstate NY on Tue Jun 21st, 2011 at 10:50:22 AM EST
[ Parent ]

Re: Scraping through? (none / 0)

Possibly.

Economics is politics by other means

by Migeru (migeru at eurotrib dot com) on Tue Jun 21st, 2011 at 10:53:46 AM EST
[ Parent ]

Re: Scraping through? (none / 1)

EU Commission says Greece should get help accessing billions of EU development funds - News1130

Greece has been unable to access billions of euros in EU funds designed to boost development in the bloc's poorer regions because it can't co-finance projects and prove that it can use them effectively.

I saw somewhere that Greece has a very low conversion rate of EU regional development funds, I understand that better now.

If the proposition is to relax the co-financing rules, or give them assistance in qualifying projects, then perhaps it might be the start of "doing the right thing now that we've exhausted all the other possibilities"?

_{It is rightly acknowledged that people of faith have no monopoly of virtue
- Queen Elizabeth II}

by eurogreen on Tue Jun 21st, 2011 at 12:14:38 PM EST
[ Parent ]

Re: Scraping through? (none / 1)

How is Greece going to co-finance in the throes of austerity?

It would be best for Greece to turn Barroso's proposal on its head and ask to be allowed to roll over unused cohesion funds until after it is solvent again.

Economics is politics by other means

by Migeru (migeru at eurotrib dot com) on Tue Jun 21st, 2011 at 12:37:57 PM EST
[ Parent ]

Re: Scraping through? (4.00 / 2)

...the EU could accelerate payouts and frontload some projects, which could give Greece quick access to some €1 billion to help make its businesses more competitive

Competitive to what?

The unassailable fact¹ is there are 4.5 billion people who would be ecstatic to have a job paying €10,000/yr whereas that money would only enable a Greek citizen to live on a park bench and eat cat food. The unassailable fact¹ is the EU (and US and Canada and etc.) Cost of Living is too high compared to the global wage rate. The unassailable fact¹ is the Cost of Living MUST, at some point, fall to some correlation to the wage rate for the stark reason people cannot buy what they do not have the money to buy. And as the Cost of Living falls economic activity, as measured in money decreases, as well.

Austrians and NCE economists like to go around bleating, "TANSTAAFL." Well, it applies to the FIRE sector as well as the slob on the assembly line. As the COL falls FIRE sector profits and their expected and booked profits on previous investments MUST fall, as well, with the effective negative return on those investments directly related to the amount of leverage they created on the primary paper².

Also Sprach CAPM.

The Germans and French are attempting - I don't know how consciously - to use the Greek government as a pass-through entity in an attempt to shore-up their own FIRE institutions who foolishly lent the money in the first place and who foolishly bought the bonds in the second place. The "actual" crisis is not the PIGS or the EU periphery; the "actual" crisis is the fact the German and French FIRE sector is, effectively, bankrupt because they made foolish investments with their operating capital.

---------------------------------------------------------------------------------------------------- ---

¹ like a turd in a punchbowl

² ignoring the fact the downside of a leveraged investment is greater than the upside

Ever since I learnt about confirmation bias I've started seeing it everywhere

by ATinNM on Tue Jun 21st, 2011 at 11:45:14 AM EST
[ Parent ]

Re: Scraping through? (none / 1)

Perhaps the global wage rate is too low?

by Colman (colman at eurotrib.com) on Tue Jun 21st, 2011 at 11:49:57 AM EST
[ Parent ]

Re: Scraping through? (none / 0)

TANSTAAFL!

Economics is politics by other means

by Migeru (migeru at eurotrib dot com) on Tue Jun 21st, 2011 at 11:52:16 AM EST
[ Parent ]

Do you mean Tinstaafl? (none / 0)

TANSTAAFL sound like some sort of smorgasbord.

_{It is rightly acknowledged that people of faith have no monopoly of virtue
- Queen Elizabeth II}

by eurogreen on Tue Jun 21st, 2011 at 12:20:48 PM EST
[ Parent ]

Ah, I was thinking of Rijsttafel (none / 0)

Rijsttafel - Wikipedia, the free encyclopedia

The Indonesian rijsttafel (pr: RYST-tah-fell), a Dutch word that literally translates to "rice table", is an elaborate meal adapted by the Dutch from the Indonesian feast called nasi padang.

Prizes for what it's an anagram for.

"Really, it's just so terribly troublesome, a free European lunch"

_{It is rightly acknowledged that people of faith have no monopoly of virtue
- Queen Elizabeth II}

by eurogreen on Thu Jun 23rd, 2011 at 07:35:12 AM EST
[ Parent ]

Re: Scraping through? (none / 1)

The global wage rate is too low for some areas (relative to their COL,) too high for some areas (relative to their productivity,) and just right for others.

Under these conditions trans-nationals can 'arbitrage' the labor costs of their goods by buying labor in low COL and wage rate areas, selling in high COL and wage rate areas.

Ever since I learnt about confirmation bias I've started seeing it everywhere

by ATinNM on Tue Jun 21st, 2011 at 12:05:38 PM EST
[ Parent ]

Re: Scraping through? (none / 1)

This arbitrage operation is what floating currencies and full employment fiscal policy are supposed to prevent, by making sure that wages equal cost of living equal productivity in any given currency zone, and dumping the residual on the money markets.

But obviously this sticks the money markets with the unenviable role of actually doing their jobs. So naturally they tend to object to that.

- Jake

If you only spend 20 minutes of the rest of your life on economics, go spend them here.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Tue Jun 21st, 2011 at 12:18:10 PM EST
[ Parent ]

Re: Scraping through? (none / 1)

And also why God invented tariffs.

Well acknowledged place tariffs can, under some circumstances, have deleterious outcomes. It's not so well-acknowledged¹ placing tariffs too low can also have deleterious outcomes.

It would help if economists, policy advisers, and Decision Makers could spell "d-y-n-a-m-i-c f-e-e-d-b-a-c-k l-o-o-p-s" ... but let us not wish for the impossible.

¹ Generally by regulators and their "enablers" sticking their fingers in the ears and shouting, "La! La! La! I can't hear you!"

Ever since I learnt about confirmation bias I've started seeing it everywhere

by ATinNM on Tue Jun 21st, 2011 at 02:54:09 PM EST
[ Parent ]

Re: Scraping through? (none / 0)

Tariffs are not needed simply to balance different CoL levels. The smart way to use tariffs is to compensate for hidden subsidies.

Such as subsidy-by-dead-coal-miners and subsidy-by-dumping-dioxin-in-the-river.

- Jake

If you only spend 20 minutes of the rest of your life on economics, go spend them here.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Tue Jun 21st, 2011 at 04:29:25 PM EST
[ Parent ]

Scraping through? | 70 comments (70 topical, 0 editorial, 0 hidden)

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