Greece

[El Presidente]

Take a country with a rich history which has for decades reveled in economic madness and lives far above its means. A country where 30% + of the population works for the state, where tax avoidance is a national past time, whose manufacturing base consists of Ouzo and Retsina.

Can it be saved at all with 65 billion Euro when it really needs 130 Billion Euro? should the government enact the necessary laws required to move it to a sustainable economy and they will have a recession and a change of government within a few years.

Don't assist and it falls into the abyss as opposed to teetering on the edge, perhaps taking another 2-3 countries with it.

Does anyone really believe Europe or the IMF will see its 65 Million Euro back?

Is Greece too big to let fail?

You have the final decision. Call it.

[MIKA27]

This is a little too complicated for myself to fully respond to however considering the Greeks do live way above their means, perhaps this will be a wake up call of epic preportions.

I know Germany do not wish for Greece to fall and are considering giving more in the aid package but looking at how much Greece requires, I highly doubt 65bn euros will stretch that far. Will the Greek governments austerity measures (Designed to cut domestic spending and reduce its ballooning budget defecit) prove unpopular with the Greek public seeing they are used to living lavishly?

Apparently Standard and poors have rated Greek bonds 'junk' which increases doubt. When ratings agencies downgrade the country's credit rating - it means they think it is now a riskier place to invest. If it reaches junk status, a country loses its investment grade status. Some financial institutions have rules prohibiting them from investing in 'junk' bonds. S&P have also warned holders of Greek debt that they only had an "average chance" of between 30% and 50% of getting their money back in the event of a debt restructuring or default.

Doesn't look all that good to me.

Looking at Greeces weak long-term growth prospects makes the country even less credit-worthy and as such, it would be a tough call to back them unfortunately.

[mkz]

I´ll say let them fall!!

But first, kick ´em out from the euro-zone and let them deal with their own currency again. When greece was approved for the euro it was with numbers that was sugarcoated, dipped in greek honey and then sugarcoated again. This is also one of the most corrupted countries in the EU. Let them deal with their own fraud!

Just makes me sick reading over and over again in the papers about this country or that company needs an bailout because they cant handle their own business: Save greece! Save SAAB! Save the airline companies from the ash! Come on!!

[Loki]

Take a country with a rich history which has for decades reveled in economic madness and lives far above its means. A country where 30% + of the population works for the state, where tax avoidance is a national past time, whose manufacturing base consists of Ouzo and Retsina.

Can it be saved at all with 65 billion Euro when it really needs 130 Billion Euro? should the government enact the necessary laws required to move it to a sustainable economy and they will have a recession and a change of government within a few years.

Don't assist and it falls into the abyss as opposed to teetering on the edge, perhaps taking another 2-3 countries with it.

Does anyone really believe Europe or the IMF will see its 65 Million Euro back?

Is Greece too big to let fail?

You have the final decision. Call it.

Rob You forgot about the Raki (greek moonshine) 170 proof. I took part in making some when I was there and then sat around and drank it all day. I was there for 3 weeks in 2002 and they were way behind on the preperations for the olympics which their country founded. Seems like they're always a day late and a dollar short.

[Habanos2000]

We ALL need to be responsible for our actions. That said, the EU might consider bailing Greece out based on the assumption that they would be forced to revert back to thier original currency from the Euro (what was that the drachma?) and then repay the loan based on that currency's value. If the EU doesn't think the old form of currency will be worth the paper it's printed on, then a bailout would just be another fine example of government wasting taxpayer's money.

[shrink]

I heard that Goldman Sachs is recommending that their clients go deep on Grecian Treasury Notes, while they themselves are shorting the same paper. I don't think the entire country is going to be worth 65 Billion Euro when this is all over.

[El Presidente]

I heard that Goldman Sachs is recommending that their clients go deep on Grecian Treasury Notes, while they themselves are shorting the same paper. I don't think the entire country is going to be worth 65 Billion Euro when this is all over.

[cvm4]

Greece survives depending on how low Germany wants the Euro to depreciate. They're loving this being the exporting country that they are.

[jquest63]

I´ll say let them fall!!

But first, kick ´em out from the euro-zone and let them deal with their own currency again. When greece was approved for the euro it was with numbers that was sugarcoated, dipped in greek honey and then sugarcoated again. This is also one of the most corrupted countries in the EU. Let them deal with their own fraud!

Just makes me sick reading over and over again in the papers about this country or that company needs an bailout because they cant handle their own business: Save greece! Save SAAB! Save the airline companies from the ash! Come on!!

Couldn't agree more for exiting the euro-zone, but Greece should leave on its own for far better reasons than finance. IMHO Greece was a far more desirable country to live in and visit before joining the EU. BTW Swedes should know about Greek honey well, their women are filled with it every summer when they descend on Greece for vacation.

[Ryan]

It's not that Greece itself is too big to fail, it's the effect that it would have on the markets. Next to go would most likely be Portugal which the EU/IMF could also probably deal with, however Spain and Italy would be a different kettle of fish.

I'm not forgetting Ireland but we are a relatively small economy.

I can't see the Greek bailout not happening, negotiations will force them to come up with a 3 year deficit reduction plan, as Ireland has had to do. It'll have a lot of Greeks taking to the streets but they'll have to deal with it.

I can understand reluctance on the part of EU members to bail out a country who cooked the books regarding their deficit but it's a lesson learned.

I can also understand annoyance at a country where, among other things, state employees get to retire at 55 on a state pension getting bailed out by countries where state employees have to work until 65, soon to be 66, to get the same.

Greece huh? First they inflicted Nana Mouskouri on us, now this. Will it ever end.

[anacostiakat]

Well two things:

1 - Standard & Poor's just downgraded Greece's rating to junk status. So I don't quite see the point of bailing them out.

2 - More importantly! Is there a LCDH in Greece?

[Warren]

Well it has been in ruins for quite some time. Boy they've let some of those buildings go to hell.

I mean look at this dump.

[Loki]

Well two things:

1 - Standard & Poor's just downgraded Greece's rating to junk status. So I don't quite see the point of bailing them out.

2 - More importantly! Is there a LCDH in Greece?

Yes there is and they are a bunch of crooks. I made a purchase some years ago while in greece arrived home some weeks later to find that my credit card had been billed twice for 2 different amounts. I had to dipute it with the CC company but I prevailed.

[acidmase]

Well it has been in ruins for quite some time. Boy they've let some of those buildings go to hell.

I mean look at this dump.

LMFAO LMFAO......

For some reason when they say bail out for some reason it reminds me of the US from some odd reason lol I wonder why? If Greece does crap out wouldn’t it affect the euro?

[kafreeman]

LMFAO LMFAO......

For some reason when they say bail out for some reason it reminds me of the US from some odd reason lol I wonder why? If Greece does crap out wouldn't it affect the euro?

The US should be able to bail them out no problem, GM says it repaid all of its government loans!!!!

[Omskakas]

They cheated their way to euro € and have been running deficit for years even during boom years.

I say kick them out from euro and let them default.

[tigger]

The US should be able to bail them out no problem, GM says it repaid all of its government loans!!!!

With more government loans. I can't even begin to described how pissed off I was when I found that out.

I'm a bit on the fence about Greece. Allowing them to default could be dangerous.

But from what I've read in the press about Greek workers protesting/striking against austerity measures, I'm inclined to say let 'em hang.

[Chaki]

Greece, too big to fail? (to answer the initial question)

No, it is only 2% of the GDP of the EU as a whole.

If failing means defaulting on its debt, what's the big deal? It happened to Argentina, Mexico, Russia...last time I looked, these countries were still there. And it would not mean the end of the Euro either, not more than, say, California defaulting on its debt would mean the end of the US Dollar.

No one put a gun to the head of Greece and forced them to borrow from the world capital markets. They did so because they lived beyond their means: the Government ran a budget deficit, the country ran a current account deficit, the people were partying. Now they have to pay the bills but they don't want to. Tough luck. Like someone said above, why would German or French taxpayers who retire at 60 would pay so that Greek civil servants can retire at 55? Why is it that Greece cannot do what Korea, Thailand and Indonesia did in 1996-98? They need their Margaret Thatcher moment and all will be fine. Restructuring its economy after it defaulted would be easier and faster as it would do so without the pressure of financial markets.

The financial markets are not blameless either. Banks and investors that lent to Greece were all consenting adults. No one forced them to do so. They were looking for some extra returns and did not assess the risk properly. Too bad for them, but that does not justify their being bailed out by the taxpayers. Because bailing out Greece just means to lend it new money so that it can repay its initial creditors. And who are they? Mostly German and French institutions anyway. They might as well take their loss (as would happen if Greece defaulted) and be recapitalized by their own countries. The US did it with their own banks and 12 months later, the same banks are paying huge bonuses again as if nothing happened.

In fact, a Greek default would probably be a positive for the Euro. It would mean that European institutions are solid and that European countries respect the law. Indeed, the Maastricht Treaty clearly forbids any bailout. In a world of paper money, only the trust people have in a central bank and a Government standing behind a currency gives it any value. If a Greek default leads to Portugal or Spain putting their house in order faster, so much better for the Euro.

[Wiley]

Wow, kind of reminds me, make that definitely reminds me, of the US:

50% of American Households pay no federal income tax

Q: Have you heard about McDonald's' new Obama Value Meal?

A: Order anything you like and the guy behind you has to pay for it.

--Conan O'Brien

[khomeinist]

Wow, kind of reminds me, make that definitely reminds me, of the US:

50% of American Households pay no federal income tax

Is that an argument for increasing taxation rates and reducing allowable deductions for the poor and working middle-class? LOL

Blame the people. Praise the markets.

[Wiley]

You're damn right it is. The "people" need to step up and pay their share.

[khomeinist]

You're damn right it is. The "people" need to step up and pay their share.

Umm...they do. Perhaps you are familiar with the regressive sales tax structure? But if your point alludes to the ridiculous tax cuts enacted by G Dub, I am in full agreement.

I will try to avoid playing Nero's fiddle....but the current global economic situation is amusing in light of years of overly-optimistic 'scientific' economic theory.... Milton, Greenspan, etc.... great work guys

[Wiley]

We don't have a national sales tax, regressive or otherwise. I hope we get one.

[khomeinist]

Damn freeloaders. I work hard for my 200K

[Wiley]

amen