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They would need to impose capital controls. At least on a temporary basis they would have to suspend the application of the Schengen agreement. Their central bank would be shut off from the rest of the Eurosystem. It would be like the Argentinean corralito, on steroids. Greece would have to ration necessities and use a local currency while using the remaining Euro reserves held in Greece to purchase fuel and food in international markets. Comandeering local Euro reserves in this way might prove tricky as Euros would be hoarded by the population away from the State's reach.

While one can possibly argue that this wouldn't be worse for Greece than the current situation, just qualitatively different, if would be worse for the Greek elites and those who currently keep their jobs, and who directly or indirectly are the life support of the indignant gathered at Syntagma. It would also trigger an absolute financial disaster in Europe and the US. In Europe the Eurozone wouldn't last the week. The "peripheral countries" and maybe even France would be devastated by a run as money fled to Germany. Internationally active investment banks (Swiss, English and American) would have to be rescued from their CDS exposures.

Economics is politics by other means

by Migeru (migeru at eurotrib dot com) on Sat Jun 18th, 2011 at 02:49:29 AM EST
[ Parent ]
ECB must have a hard money policy; Germany will keep its mercantalist economy; and Greece's leaving the euro would bring a worldwide financial crisis. There's little chance of a European bond.

Is default the only answer and pick up the pieces from there? Or would default be the same as leaving the euro?

Hey, Grandma Moses started late!

by LEP on Sat Jun 18th, 2011 at 03:13:54 AM EST
[ Parent ]
Under default:
Greece would have to ration necessities and use a local currency while using the remaining Euro reserves held in Greece to purchase fuel and food in international markets. Comandeering local Euro reserves in this way might prove tricky as Euros would be hoarded by the population away from the State's reach. They would need to impose capital controls. At least on a temporary basis they would have to suspend the application of the Schengen agreement. Their central bank would be shut off from the rest of the Eurosystem. It would be like the Argentinean corralito, on steroids.

While one can possibly argue that this wouldn't be worse for Greece than the current situation, just qualitatively different, if would be worse for the Greek elites and those who currently keep their jobs, and who directly or indirectly are the life support of the indignant gathered at Syntagma. It would also trigger an absolute financial disaster in Europe and the US. In Europe the Eurozone wouldn't last the week. The "peripheral countries" and maybe even France would be devastated by a run as money fled to Germany. Internationally active investment banks (Swiss, English and American) would have to be rescued from their CDS exposures.

The only change is that the first and second halves of the first paragraph would switch places as to which one logically precedes the other.

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Sat Jun 18th, 2011 at 03:18:16 AM EST
[ Parent ]
I suppose one solution would be the ECB buying up all the Greek bonds it could get its hands on, then have Greece default on those bonds, then the ECB repairing it's balance sheet by printing new money. Not the best solution, not ideal in any way, but it might just work.

Peak oil is not an energy crisis. It is a liquid fuel crisis.
by Starvid on Sat Jun 18th, 2011 at 10:31:46 AM EST
[ Parent ]
That would solve the problem...

... for another five to ten years, until it blows up again.

The problem is that there is no surplus limitation or recycling mechanism. If you do not fix that problem, you do not fix the Eurozone.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Sat Jun 18th, 2011 at 11:09:54 AM EST
[ Parent ]
Fiscal transfers would do the trick for Greece too.

For Spain, a simple eurobond up to 80% of GDP would be enough to keep it well anchored. Of course, this is, ina  sense, a recycling mechanism.

First print all the money needed for Greece... then make it formal with fiscal transfers.

Why, oh why they think printing money is inflationary in Europe... maybe they should say it would be inflationary in germany.. but really?

A pleasure

I therefore claim to show, not how men think in myths, but how myths operate in men's minds without their being aware of the fact. Levi-Strauss, Claude

by kcurie on Sat Jun 18th, 2011 at 11:24:33 AM EST
[ Parent ]
Printing money to give to Greece would mean they would turn-around and give it to the banks who are themselves part of the problem.  Near as I can tell, from the little I know, Greece should not have been able to borrow as much money as they did in the first place; they had no demonstrated ability to invest the money in productive enterprises to generate the funds to pay the debt off.

Any way one cares to look at it, the global financial system was fundamentally flawed which has led to the current crisis, is maintaining the current crisis, and is digging the world ever deeper into crisis.  Any way one cares to look at it, Neo-Classical Economics - the intellectual basis of the global financial system - was and is fundamentally flawed which has led to the current crisis, is maintaining the current crisis, and is digging the world ever deeper into crisis.

I suggest "Greece" (and Hungary and Lithuania and Iceland and ...) is a symptom, rather than the disease, and it's the disease that needs curing first and only then can the crisis be fixed.

She believed in nothing; only her skepticism kept her from being an atheist. -- Jean-Paul Sartre

by ATinNM on Sat Jun 18th, 2011 at 12:23:45 PM EST
[ Parent ]
Near as I can tell, from the little I know, Greece should not have been able to borrow as much money as they did in the first place; they had no demonstrated ability to invest the money in productive enterprises to generate the funds to pay the debt off.

Where did the money go?

Hey, Grandma Moses started late!

by LEP on Sat Jun 18th, 2011 at 01:18:07 PM EST
[ Parent ]
Roughly $14.85 billion/year went to arms purchases, with the big ticket items bought from Germany and France.

Arms makers lean on Greece

France is pushing to sell six frigates, 15 helicopters and up to 40 top-of-the-range Rafale fighter aircraft.

...

Germany is meanwhile pressing Athens to pay for a diesel-electric submarine from ThyssenKrupp, of which it refused to take delivery in 2006 because the craft listed during sea trials following a disputed refurbishment in Kiel.




She believed in nothing; only her skepticism kept her from being an atheist. -- Jean-Paul Sartre
by ATinNM on Sat Jun 18th, 2011 at 01:46:37 PM EST
[ Parent ]
Thus you feel military investment is not 'productive.'That's a strange position to take. ;)

Hey, Grandma Moses started late!
by LEP on Sat Jun 18th, 2011 at 03:12:12 PM EST
[ Parent ]
It's plenty productive as a form of permissible industrial subsidy in a polity infested by neoclassical brain rot. Unfortunately, it is only productive for those countries the armaments are bought for, so it does not improve the customer's ability to pay for such procurement.

Which, of course, was never the point of neoclassical policy prescriptions, which are a pretty transparent game of three-card monte designed to con countries out of their resources and sovereignty and into colonial servitude. It's just a pity the market-fundies believe their own propaganda.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Sat Jun 18th, 2011 at 05:10:05 PM EST
[ Parent ]
neoclassical brain rot

Gettin' a mite testy there, Bruce old boy me duck.

LOL

She believed in nothing; only her skepticism kept her from being an atheist. -- Jean-Paul Sartre

by ATinNM on Sun Jun 19th, 2011 at 12:16:04 AM EST
[ Parent ]
Jake, I meant.

She believed in nothing; only her skepticism kept her from being an atheist. -- Jean-Paul Sartre
by ATinNM on Sun Jun 19th, 2011 at 12:19:22 AM EST
[ Parent ]
I could think of less flattering comparisons ;-)

And yes, I am getting a little tired of seeing people do the same thing that has blown up three times over the last three generations - one time sufficiently spectacularly that you need nine figures to count the casualties.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon Jun 20th, 2011 at 10:05:36 AM EST
[ Parent ]
That's $150 billion over 10 years. Add in a few Bridges to Nowhere, an Olympics, a State of the Art national public surveillance system purchased for a billion from the USA (it's non-functional), and you're at $200 billion. Couple that with a bevy of very low-paying jobs in gov't that take people out of economic productivity, and well, you've messed things up.

How can these things be reversed?

Don't spend $150 billion for armaments, don't host the Olympics, put your politicians in jail when they are involved in boondoggles with foreign corporations, downsize your government employee workforce and then DOUBLE the average pay of lowpaid workers.

by Upstate NY on Sat Jun 18th, 2011 at 06:27:31 PM EST
[ Parent ]
If you are telling me that the root of the problem is the crazy finantial system coming from an stupid non-scientific mythology regarding the long-term neutrality of money and the fact that the economy is not studied as a complex system in accademia but as a marginalist super-strucutre.. do you think I can disagree?? (I still remember reading with incredulity the macro and micro books of Krugman..are they stupid? I think the new versions are going to be a huge improvement)

And still, macro has a very useful tool to get the general structure, you have mean field models like Say, Keynnes or Friedman which offer you a clue about the general dynamics of the systems. More specifically, they tell you about the fixed points of the system. Getting in the mesostructure with mean field models is, by definition ,stupid nonsense and dangerous, but even smart people like Sagro here never heard about that fact (if your read carefully what he writes). Scientifically speaking they are ignoramus: plain narrative-builders of hot-air, people who do not know anything about what a complex system is. They do not know what a bifurcation is, they do not know what is a slave variable, a manifold.. I doubt they have ever solved numerically a chaotic dynamical system ... they are stupid and they think they are smart.

Yes, the problem is that the present financial system is a crazy mess, and it should be dismantled... the second problem is that there is no scientific model of the main equations which relate fluxes and variables at the mesosocopic model of the economy with hard-tested differential equations for the different sectors of production (some people in MMT try to do it at least, with more or less success, but they try at least!!!), and even less for the main flows of money and assets-type money. So, we do not know which financial system would produce a better outcome in the process or increasing the number of goods which can be "copied at zero cost" as the marginalist would say.

But there is a hope: in a lot of corners of the academia,  people like Krugman, Delong, etc.. who knew that mean-field theories were reliable but the detailed model were not (though harmless- and still they think that the best science is econometrics coupled with mean-field models at each scale), now realize that micro-based macro models are dangerous. They realize that when you construct a model that is clearly wrong on its premises, when you do not understand that the whole is more than the sum of its parts, these models can be published at will depending on political interests because it is "a model"  even if it assumes nonsense (DSGE anyone?). I think they will take more seriously the idea that they should teach mean-field models as they are to students, eliminating all the neo-classical  shit microfoundations. Now there are, at long last, pushing for other ways to approach the system. In 20-30 years we may get a proper scientific insight on financial and monetary policy.

Now, we have history and well-tested mean field theories. It is enough to know what this a crisis due to panic fly to monetary assets reducing the demand for present consumption. We know that financial markets panic and destroy money. So, even taking into account of the fact that the way textbooks teach how banks create money is bullocks (we all create money, you only need three people, Mig repetition!!!), we know enough to predict exactly what will happen, given the fix points of the system. Bu we do not know enough about how to tell the fundamentalists and ignoramus of the ECB that they are dumb, crazy and shitfull, and make it stick. We do not have enough media, adn we can not treat them like wackos as we treat the global-warming is a hoax, AIDS is not a virus and the second law of thermodynamics goes against God's will type of people. And on fundamentals, they are the same kind of people.

A pleasure

I therefore claim to show, not how men think in myths, but how myths operate in men's minds without their being aware of the fact. Levi-Strauss, Claude

by kcurie on Sun Jun 19th, 2011 at 09:14:28 AM EST
[ Parent ]
For the Absolute Ever-Living Mother-Loving Win.

She believed in nothing; only her skepticism kept her from being an atheist. -- Jean-Paul Sartre
by ATinNM on Sun Jun 19th, 2011 at 11:43:26 AM EST
[ Parent ]
Getting in the mesostructure with mean field models is, by definition, stupid nonsense and dangerous, but even smart people like Sagro here never heard about that fact (if your read carefully what he writes)

I studied phase transitions before becoming an economist, you know. But there are some problems in applying statistical physics methods to economics, which force most of us - formed physicists - into econometrics or finance when we switch to economics. Perhaps the future lies the stat phys way, but we just don't know how to jump there.

Yes, I did simulate chaotic systems, and I do know what a bifurcation is. If you think econophysics is an answer, I doubt it - torturing minority game to death won't move us far. Catastrophe theory was tried and abandoned, as well.

Thanks for a breath of sanity, anyway.

by Sargon on Sun Jun 19th, 2011 at 01:30:55 PM EST
[ Parent ]
Dynamical equations... that's why you are forced into econometrics...there is no framework for a classical dynamical system modeling approach...where behaviors are terms in the equation. Game theory can give you some insight in some asset-based flows and some oligopolistic markets...not much more.

I know, it  is sounds like psychohistory because that's what it is...then , your hypothesis can be perfectly tested: which terms reproduce the observed data?

A pleasure

I therefore claim to show, not how men think in myths, but how myths operate in men's minds without their being aware of the fact. Levi-Strauss, Claude

by kcurie on Mon Jun 20th, 2011 at 04:38:28 AM EST
[ Parent ]
Dynamical equation approaches are likely doomed as closed theories because one way of thinking about the effects of economic innovation is to imagine it as changing the dimensionality of the dynamical system.

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Mon Jun 20th, 2011 at 04:41:23 AM EST
[ Parent ]
Yes.. that is still the main problem...New markets. It seems long-term is not achievable.. short-term predictions could be in principle done. I think they could explain a lot about short-term poicy.. I mean, Greece, the FED, the ECB, the euros, the finantial shock.. you do not need a model with new markets changing the dimensionality.

and if the new markets do not represent a large chunk.. you may have proper medium-term approaches.

A pleasure

I therefore claim to show, not how men think in myths, but how myths operate in men's minds without their being aware of the fact. Levi-Strauss, Claude

by kcurie on Mon Jun 20th, 2011 at 04:52:07 AM EST
[ Parent ]
I contend that a [the?] major factor in the business cycle is the emergence of a new market.

Drawing a physical parallel, my model of the business cycle would be a bifurcation of an infinite-dymensional dynamical system on the period-doubling cascade. Imagine a fluid in a situation describable by a finite number of proper modes and thus a finite-dimensional dynamical system approximation. Other modes are all stable (i.e., a small deviation tends to dissipate). At some points as you increase the throughput (Reynolds number) one of the stable modes becomes marginal, then unstable. Then any noise will be amplified exponentially in the direction of this new unstable mode. But of course the right thing to do there is to consider the dynamical system of one dimension higher, where the growth of the mode is not exponential. It ia approximately exponential initially but then it saturates. Logistic growth might be a better approximation. So you have a transition from an attractor in N dimensions to one in N+1 dimensions that's a business cycle.

So the scale of one business cycle must be the medium-term timescale you talk about.

Economics is politics by other means

by Migeru (migeru at eurotrib dot com) on Mon Jun 20th, 2011 at 05:02:51 AM EST
[ Parent ]
So, in other words, complex mathematics are a key to good economics.
by Upstate NY on Mon Jun 20th, 2011 at 09:22:03 AM EST
[ Parent ]
Economics is harder than ecology which is harder than statistical physics which is harder than mechanics which is harder than geometry.

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Mon Jun 20th, 2011 at 09:29:52 AM EST
[ Parent ]
Is Economics harder than Physics, or is it at the Galileo stage of its development, where  all the accepted scientists are in the possession of the Pope?

Any idiot can face a crisis - it's day to day living that wears you out.
by ceebs (ceebs (at) eurotrib (dot) com) on Mon Jun 20th, 2011 at 09:39:19 AM EST
[ Parent ]
The two are not mutually exclusive.

The harder a discipline is to study, the later should you expect it to mature as a field of science. If for no other reason then because getting good data is going to be a lot more expensive. One dude and his manservant could get quite good data on planetary motion even before the telescope. One dude and his manservant haven't a snowflake's chance in a blast furnace of getting good macroeconomic data unless they live in a modern industrial society that can afford to spend up to a percent of its GDP on data collection alone (and has the technology to automate much of it, and the institutions needed to standardise and enforce reporting requirements).

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon Jun 20th, 2011 at 09:55:58 AM EST
[ Parent ]
I am reminded of Dune where the Fremen had an understanding of the planets ecology that included Fremen as a large foraging animal. Fortunately that would be a stabilizing feed-back loop as it would reinforce the cultural norms of a large foraging animal.

In economics on the other hand, if you assume that humans are homo economicus, you then must assume that a fair number will read and act upon the theories in order to gain most for themselves. A de-stabilizing feedback loop as acting to take advantage of the system described in general includes acting differently then the system prescribes.

Then again, most of us are not sociopathic homo economicus at all. So there is that problem too.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Mon Jun 20th, 2011 at 02:43:44 PM EST
[ Parent ]
I am reminded of Dune where the Fremen had an understanding of the planets ecology that included Fremen as a large foraging animal. Fortunately that would be a stabilizing feed-back loop as it would reinforce the cultural norms of a large foraging animal.

At one point, Herbert has the planetologist who "goes native" claim that: "The highest function of ecology is understanding consequences."

Oh, and the name of that planetologist? Pardot Kynes. There are many good things that can be said about Herbert's alliterations. "Subtle," however, is not one of them.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon Jun 20th, 2011 at 03:20:16 PM EST
[ Parent ]
No.

Not misspecifying your models is key to good economics. There is nothing particularly enlightening about complex mathematics in and of itself.

The fact that not misspecifying your models requires complex mathematics is an unfortunate reality. The world would be much easier to understand if it didn't. But the reality is what it is - it doesn't get any worse by owning up to it.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon Jun 20th, 2011 at 09:36:33 AM EST
[ Parent ]
Also note, the change of dimensionality is a problem that would also plague ecology and sociology. These are evolving systems that can generate their own new entities endogenously though processes not described at the level of abstraction of the dynamical system description.

This is an idea of theoretical biologist Stuart Keuffman, and I came across it in a joint paper of him with Lee Smolin on cosmology (!). Here is the key quote:

(There is an analogous issue in theoretical biology. The problem is that it does not appear that a pre-specifiable set of "functionalities" exists in biology, where pre-specifiable means a compact description of an effective procedure to characterize ahead of time, each member of the set[8,7]. This problem seems to limit the possibilities of a formal framework for biology in which there is a pre-specified space of states which describe the functionalities of elements of a biological system. Similarly, one may question whether it is in principle possible in economic theory to give in advance an a priori list of all the possible kinds of jobs, or goods or services[8].)


Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Mon Jun 20th, 2011 at 05:44:13 AM EST
[ Parent ]
See also A Manifesto for Modern Political Economics: Extracts from our new book by Yanis Varoufakis
The cause of this failure is the inherent error; the inevitable logical inconsistency of any system of ideas whose purpose is to describe capitalism in mathematical or engineering terms. This is not, however, an intellectual failure as such. It is a mere reflection of capitalism's essence, which only appears to us as logical inconsistency when we try to transplant into political economics an mindframe confined within some fixed `geometry'. Imagine a theorist that tries to explain complex evolving ecosystems by means of engineering models. What would result but incongruity and a mindset bent on misunderstanding the essence of the explanandum; a flight from that which craves explanation?

Political economists are that kind of theorist: nuts-and-bolts mechanics trying to defeat indeterminacy and to replace it with `closure'; tragi-comic figures struggling to impose a mechanical template upon evolving systems. No matter how skilled as engineers, and irrespectively of how adept we are at machining our tools precisely, our efforts are doomed. If anyone doubts that, it is worthwhile looking at what happened when economists accepted the challenge of incorporating evolutionary mechanisms into their study of capitalism's historical dynamics: The exciting logic of Darwinian evolution (according to which complex patterns arise spontaneously from very simple underlying mechanisms) was emptied of all content and thrown onto the pyre of the inherent error.[i] Like a latter-day Midas, everything that the mainstream economist touches turns into a glittering, barren `thing', bereft of life and explanatory potential.

This is the stuff of unintended consequences of efforts to transplant a `scientific' approach to political economics. The best intentioned political economists begin with a healthy appreciation of the fact that their models are nothing but provisional forays into structured thinking. David Ricardo, Karl Marx, Alfred Marshall and John von Neumann are excellent examples. However, they are inevitably led astray by the very ambition to model economic phenomena by means of `closed' accounts of all the variables within. As we explained in preceding chapters, this ambition ensures that, before long, the models take over and the provisional terms in which they do their work start regarding themselves as direct reflections of a concrete reality.



Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Mon Jun 20th, 2011 at 07:11:02 AM EST
[ Parent ]
Kauffman, not Keuffman.

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Mon Jun 20th, 2011 at 09:08:45 AM EST
[ Parent ]
there is no framework for a classical dynamical system modeling approach...where behaviors are terms in the equation.

There's Systems Theory which

von Bertalanffy believed a general theory of systems "should be an important regulative device in science," to guard against superficial analogies that "are useless in science and harmful in their practical consequences."

Sargon, somewhere in here, states Economics have abandoned Catastrophe Theory.  What was NOT said was CT was not found to be unapplicable to Economics it was found the mathematical techniques for applying CT to Economics were, and are, unknown; some nitty-gritty, in-the-trenches, actual for-fucking-real research needed to be done.  It was deemed (covertly, nobody came right out and said it) much easier to ignore what CT was telling them and bullshit their way through.

She believed in nothing; only her skepticism kept her from being an atheist. -- Jean-Paul Sartre

by ATinNM on Wed Jun 22nd, 2011 at 09:12:28 PM EST
[ Parent ]
Oh.. I forgot.

I still got from your writing that in your training the idea that modeling mesostructure with mean-field approaches or microdynamics is crazy nuts was not something included. Somehow I got the idea you seem to be OK with this approach thinking that economics is different than solid state physics regarding the difference between micro, meso and macro. Well, the craziness of simulating macro with micro.

I apologize if I was wrong.

A pleasure

I therefore claim to show, not how men think in myths, but how myths operate in men's minds without their being aware of the fact. Levi-Strauss, Claude

by kcurie on Mon Jun 20th, 2011 at 04:44:20 AM EST
[ Parent ]
Any way one cares to look at it, Neo-Classical Economics - the intellectual basis of the global financial system - was and is fundamentally flawed which has led to the current crisis, is maintaining the current crisis, and is digging the world ever deeper into crisis.

I suggest "Greece" (and Hungary and Lithuania and Iceland and ...) is a symptom, rather than the disease, and it's the disease that needs curing first and only then can the crisis be fixed.

Death to the vermin (c) Vernon Vinge, A Fire Upon the Deep.

by Sargon on Sun Jun 19th, 2011 at 02:04:37 PM EST
[ Parent ]
I don't understand the reference.

She believed in nothing; only her skepticism kept her from being an atheist. -- Jean-Paul Sartre
by ATinNM on Sun Jun 19th, 2011 at 02:33:58 PM EST
[ Parent ]
You have to read the book, sorry. The major idea - beware of those who want you to exterminate some 'vermin'. Or 'disease'.
by Sargon on Sun Jun 19th, 2011 at 02:54:44 PM EST
[ Parent ]
Claiming that something is an intellectual disease that needs curing appears to me to be a far bit from claiming someone is vermin that needs to be exterminated.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se
by A swedish kind of death on Sun Jun 19th, 2011 at 03:12:33 PM EST
[ Parent ]
</sarcasm>
by Sargon on Sun Jun 19th, 2011 at 03:24:36 PM EST
[ Parent ]
If mass murder was my gig I'd be making a fat 3 figure income designing advanced weapon systems for the US military.  

She believed in nothing; only her skepticism kept her from being an atheist. -- Jean-Paul Sartre
by ATinNM on Sun Jun 19th, 2011 at 04:33:41 PM EST
[ Parent ]
Nor do you solve the problem with deficits in the PIGS. But as the current policy is mainly about kicking the can down the road and hoping for divine intervention, we might well see something like this happening.

Peak oil is not an energy crisis. It is a liquid fuel crisis.
by Starvid on Sat Jun 18th, 2011 at 11:31:42 AM EST
[ Parent ]
Our food dependency increased massively since entering the EU.

If they feed you, they own you.

by cagatacos on Sat Jun 18th, 2011 at 03:59:46 AM EST
[ Parent ]


Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Sat Jun 18th, 2011 at 04:03:19 AM EST
[ Parent ]
The same thing happened in Greece. Svelte Greeks became the most overweight in Europe. Greece is the biggest importer of French beef in the world.
by Upstate NY on Sat Jun 18th, 2011 at 09:37:38 AM EST
[ Parent ]
Given the consequences, why didn't they do something smarter in the beginning with their 195 billion euros? Greece's deficit was 250 billion.

When you look at this, you begin to think a guy like Varoufakis is out of his mind. How could he possibly want MORE Europe when there is no leadership, no intelligence, and most of all, little cohesion and trust. This is why he's preaching to his fellow Greeks that default is a mistake at the same time that he's suggesting Greece issue ultimatums to the rest of Europe. But he's insane. Ultimatums can only lead to default for the precise reason that this whole crisis has been botched from the beginning.

I said this early on. For any real change to happen, the people making policy would personally have to feel the pain of losses. Over the last few years, we have a financial class that's become wealthier, not less wealthy. Whatever is happening has so far worked for them. Bini Smaghi, Draghi, Weidmann, Merkel, Junker, Stark, Rehn, etc. are people who are incapable of empathy. They are maybe just a hair more humane than Greek politicians.

by Upstate NY on Sat Jun 18th, 2011 at 09:36:43 AM EST
[ Parent ]

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