Greece

[mkz]

BTW Swedes should know about Greek honey well, their women are filled with it every summer when they descend on Greece for vacation.

And the rest that stays behind aint that bad either. Nordic summers can do miracles with their nipples...

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?

65 now and soon to be 67 here in Sweden. By the time I´ll reach that age it´ll probably be around 72...

55?!? Makes me mad reading about these lazy f***s!! (Sorry. In a bad mood today...)

[Nedule]

Thowing money at a failing & sinking system wont fix the real problem, & real change won't come unless you're in situation that makes you want to change. I think history has proven that bail outs are the proper solution.

[mazolaman]

Welcome to the end of the cruelest form of capitalism the world has known....

[Mel]

No to Bail Out. Yes to Buy Out. The US should buy the place as the 51st state for the bail out price and turn it into a giant Disney Land for Adults, a super tourist destination. With the way the US is printing money all we need is to get some more ink.

Really though why should the responsible pay for the reckless?????????

[khomeinist]

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

right....ok. Let me clarify... most states have a regressive sales tax structure.

But to the point.... Bailouts need to be conditional and designed to change institutional behavior. This is too frequently not the case.

[Wiley]

I think liberals accidentally use the word "regressive" when they mean to say "flat" (or "fair"). I don't believe the same tax for everyone really meets the definition of regressive.

[khomeinist]

Well...actually I am not a 'liberal.' A classic liberal would probably support a 'flat' tax structure.

Fairness....LOL. That is quite the wormy can. Is extreme income disparity 'fair?' Labor markets are not rational (they don't account for many factors)....nor are they 'fair.' I am way too over-educated to swallow that one.

Regressive implying a greater percentage of relative income...so yes...regressive. Negative correlation. However you want to spin it.

[jquest63]

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.

The economy of Greece is the twenty-seventh largest economy in the world by nominal gross domestic product (GDP) and the thirty-third largest by purchasing power parity, according to the data given by the International Monetary Fund for the year 2008. Its GDP per capita is the 26th highest in the world, while its GDP PPP per capita is also the 25th. Greece is a member of the OECD, the World Trade Organization, the Black Sea Economic Cooperation, the European Union and the Eurozone.

The Greek economy is a developed economy with the 22nd highest standard of living in the world.[5] The public sector accounting for about 40% of GDP. The service sector contributes 75.7% of the total GDP, industry 20.6% and agriculture 3.7%. Greece is the twenty-fourth most globalized country in the world and is classified as a high income

The per capita income (in purchasing power terms) of Greece was 65% that of France in 1850, 56% in 1890, 62% in 1938,[7][8] 75% in 1980, 90% in 2007, 96.4% in 2008, 97.9% in 2009 and larger than countries such as South Korea, Italy, and Israel.[9][verification needed][10] The country's post-World War II development has largely been connected with the Greek economic miracle.

The term (modern) Greek economic miracle has been used to describe the impressive rate of economic and social development in Greece from the early 1950s to the mid-1970s. Between 1950 and 1973, the country had an average rate of economic growth of 7%, second in the world only to Japan’s during the same period. Growth rates were highest during the 1950s, often exceeding 10%, close to those of a modern "tiger economy" (industrial production grew annually by 10% as well, for several years, mostly in the 1960s).

Based on Wikipedia, Greece doesn't appear to be a country "which has for decades reveled in economic madness and lives far above its means".

[rahko]

65 now and soon to be 67 here in Sweden. By the time I´ll reach that age it´ll probably be around 72...

Doesn't really matter, the retirement funds will be long gone by the time we get to that age

Greece is not the problem. Our economic system as a whole is a faith-based scam, and the "problems" we are seeing are ingrained in it.

[mkz]

Doesn't really matter, the retirement funds will be long gone by the time we get to that age

My thought too... Thats why I stock up on cigars so I atleast can sit down with a good smoke and forget that I have to eat cat-food to survive.

[jquest63]

And the rest that stays behind aint that bad either. Nordic summers can do miracles with their nipples...

LOL! Now you are speaking my language. Keep the money, send Greece you women! But if you send money and Greece can't pay, just go to Greece for dance lessons in exchange. Enjoy attached clip! For me it embodies Greek attitude toward life in general. IMF, Loans, Work, Retirement who gives a F**K, what is important is to enjoy life, family and friends the most!

[gersonmorelli]

No to Bail Out. Yes to Buy Out. The US should buy the place as the 51st state for the bail out price and turn it into a giant Disney Land for Adults, a super tourist destination. With the way the US is printing money all we need is to get some more ink.

Really though why should the responsible pay for the reckless?????????

Hell, the US better stop spending so much money financing wars and their own public deficit to buy not only Greece but also Portugal, and later Spain, Italy... Because one thing is very likely: if Greece is not bailed out and defaults, the following day Portugal will also default.

Same drill as Lehman... Except after Lehman went bankrupt, the US decided to fund every financial institution (TARP) with its only source of revenue (taxpayer's money) because they knew the financial system was about to collapse. Sadly enough if the financial system had collapsed, most Americans (and most of the world for that matter) would have much lower income tax as a consequence of reduced income!

Someone mentioned that Argentina, Mexico and Russia also defaulted and were still there... Well, Argentina is still in deep **** for the past 10 years or so after default. Mexico was bailed out by the US and it couldn't be different, since it is an extension of America in terms of production and resources. Russia, well Russia is living under oil and gas former-KGB oligarchy. None of them are thriving that's for sure.

[Chaki]

I did not say that defaulting was a magical silver bullet. Merely, it is a first step that allows restructuring to be faster and easier because there is less pressure from creditors. But the countries still have to do the hard work. Maybe Argentinians, like the Greeks, did not want to do it? Mexico might be an extension of the US (your view, not mine) but by the same token Greece is an extension of the EU. Russia might not be a thriving democracy but its defaulting did not send it into a black hole.

Conversely, Indonesia defaulted and its economy is doing rather well nowadays and its currency has been one of the best performing ones lately.

[gersonmorelli]

I did not say that defaulting was a magical silver bullet. Merely, it is a first step that allows restructuring to be faster and easier because there is less pressure from creditors. But the countries still have to do the hard work. Maybe Argentinians, like the Greeks, did not want to do it? Mexico might be an extension of the US (your view, not mine) but by the same token Greece is an extension of the EU. Russia might not be a thriving democracy but its defaulting did not send it into a black hole.

Conversely, Indonesia defaulted and its economy is doing rather well nowadays and its currency has been one of the best performing ones lately.

I absolutely agree with you! The problem is the consenquence that defaulting countries have in financial and capital markets (main creditors) in terms of confidence.

Regarding Mexico, I don't want to be misinterpreted here. I did not mean that in disrespectful way. I meant Mexico is highly dependent of the US (as the US is to some extent to Mexico, otherwise why would they bail them out). It is a crucial source of production and resources to the US. Not to mention it is a beautiful country and rich culture.

IMO Russia is just lucky enough to have such a rich country in terms of natural resources. Not very different from Brazil though...

And once again, you're probably right regarding Greece. Hence my opinion that letting them go down is not the obvious solution to teach them lesson and foment growth. Unfortunetely, countries such as Greece and Argentina among others will not be a self-sustained economy for many years.

[Chaki]

Sorry- I misunderstood you on Mexico

[RedRum]

hmm... I think you guys have not been properly informed... I am greek, not proud what is happening this time in my country, but before bash a whole nation do some reading. no one in greece goes on pension st 55... you can go on 55 but you only get 60% of the normal lower level pension, which is 300-400 euros... you would still need to work, greece aint that cheep..

Yes, Greece has a large number of public servants, but this is exaggerated by the fact that all major industry is state run. Who do you think should they employ?? Greece has a free market socialist system, where health, education, trasnsport, energy, major services are all state run. Of course it is going to have a large percentage of people in the public sector.

of course there are more people employed than they should, which is a big mistake as it is not cost efficient.

Greece is actually a pretty large economy, the biggest in the Balkans, with its GDP being almost 10 times bigger than the average GDP in the Balkans.

The major point is this though: Greece put itself in trouble with the huge dept (actually what is important is not the debt itself but the % of dept to GDP which is 115%). Germany has a debt of a 1.5 trillion (yes, trillion not billion...), but still it is only 30-40% of its GDP. The problem is that the system allows investment banks to bet on one country's debt. it is a really faulty system, basically hunting down economies in order to make money. Look what is happening now. Spain has been downgraded, Portugal has been downgraded, Italy's spreads are going up... I live in the UK, and I have friends in investment banking. UK is already feeling the pressure, soon it might have problems borrowing cheaply.

Greece is indeed a small economy in the grander scheme of EU economies. But think about this. Isn't it weird that the problem of such a small economy can can trickle down so badly to other economies? It is like the problems of a small local shop affecting Walmart...

yeah, bashing countries and its lazy people is good fun, but there are 11 million people in that country, going through though times. But do some reading before you jump into conclusions that people just sit around leeching money from the goverment, while they retire at 50 with six figure pensions...

[kyriakos]

Well said.

[El Presidente]

Two of my best mates are Arthur Kassos and Steve Vergotis. Proud and successful Greeks as there ever were.

They are dismayed. No one wants to throw stones here, however the lowest tax take in the OECD points a few fingers.

[RedRum]

Yes, Greece has major problems, and needs to change a lot of things. Tax evasion is one. It was actually doing well, but the previous government completely destroyed that tax control system (I actually voted for them the first time they run).Greece had an effective equivalent of the IRS, which was dismantled... Billions were lost in some dodgy bonds. The public sector is too big, needs cutting down and Greece have very small entrepreneurship apart from tourism.

This thing might be a blessing in disguise, I sense that Greeks are ready to change. But one thing you need to consider, is that what Greece receives is not a bailout. It is lending. In fact it is a tad expensive lending, and most of EU economies that will lend to Greece will make money out of it. Germany borrows money at 3%. Greece will receive a loan from the EU at 5%. That is a good profit for a 3 year loan if you ask me...

What is actually happening, is that instead of Greece borrowing from private banks, it borrows from the IMF and EU. At this point, because of our deficit, banks lend us with 12%!!!!! 12%!!! If we borrow with 12%, we actually get into more debt. What is actually happening is that the IMF and EU take Greece out of the market and loan the money for the country to pay off its debt. It really is going to be tough, severe cuts will hit the Greeks, which are not used to it after almost 25 years of financial growth.

I know there are a lot of greeks in Australia. Actually the Greek population in Australia is the largest anywhere in the world apart from Greece! Australia is an amazing country, and you people are some of the friendliest people I have met.

I wish we had the same economic prowess and stability. It does sadden me though to see that people do not take time to really look what is happening, and bash a whole nation on unjustified grounds. I will say it again. We put ourselves in a huge mess, but there are other factors apart from our own incompetence that brought us this low

[Leonidas]

Hello fellow aficionados.

It looks like your thread is gearing more of us Greeks to participate.

Whilst I pay respect to all opinions expressed here, there is evidently lack of information with regards to what is going on in our country. RedRum's feedback was very interesting. For those interested in more numbers, you may wish to compile in the equation that 5% of the GNP is poured into military expenditure. In other words every 20 years we throw away one year of our life buying fighters, tanks, destroyers and more. And for those questioning about our allies well... we are on our own.

We are being tackled not because of our 115% deficit (Japan scores 200%). We are the weak part in a first-time-to-be-witnessed attack to the euro by muscle guys in the likes of S&P, GS and a few others.

I 'll be happy to answer any questions and give as much feedback to anyone interested.

Take care.

[Chaki]

hmm... I think you guys have not been properly informed... I am greek, not proud what is happening this time in my country, but before bash a whole nation do some reading. no one in greece goes on pension st 55... you can go on 55 but you only get 60% of the normal lower level pension, which is 300-400 euros... you would still need to work, greece aint that cheep..

Yes, Greece has a large number of public servants, but this is exaggerated by the fact that all major industry is state run. Who do you think should they employ?? Greece has a free market socialist system, where health, education, trasnsport, energy, major services are all state run. Of course it is going to have a large percentage of people in the public sector.

of course there are more people employed than they should, which is a big mistake as it is not cost efficient.

Greece is actually a pretty large economy, the biggest in the Balkans, with its GDP being almost 10 times bigger than the average GDP in the Balkans.

The major point is this though: Greece put itself in trouble with the huge dept (actually what is important is not the debt itself but the % of dept to GDP which is 115%). Germany has a debt of a 1.5 trillion (yes, trillion not billion...), but still it is only 30-40% of its GDP. The problem is that the system allows investment banks to bet on one country's debt. it is a really faulty system, basically hunting down economies in order to make money. Look what is happening now. Spain has been downgraded, Portugal has been downgraded, Italy's spreads are going up... I live in the UK, and I have friends in investment banking. UK is already feeling the pressure, soon it might have problems borrowing cheaply.

Greece is indeed a small economy in the grander scheme of EU economies. But think about this. Isn't it weird that the problem of such a small economy can can trickle down so badly to other economies? It is like the problems of a small local shop affecting Walmart...

yeah, bashing countries and its lazy people is good fun, but there are 11 million people in that country, going through though times. But do some reading before you jump into conclusions that people just sit around leeching money from the goverment, while they retire at 50 with six figure pensions...

OK, I did some (quick) reading, I found the link below:

Greek taxpayers lose equivalent of 8pc of GDP every year, Brookings study shows

Sorry this is longish and the Wall Street Journal is not my bible. However, the Brookings Institution is generally well informed. I will just post one excerpt:

"A senior government official says some tax offices operate a “4-4-2 system”, a reference to soccer tactics. If an individual or company owes €10,000 in taxes, they slip €4000 to the inspector, keep €4000, and pay €2000 to the state.

That helps explain why, in a developed country of 11m people, only around 15,000 individuals declare an annual income of more than €100,000, according to Greece's finance minister."

The point is just that before, or concurrently to, being helped by the EU and the IMF, perhaps the Greeks could help themselves?

Apologies if I generalized the official retirement age wrongly, but if one has not been paying tax for 30 years, one could retire comfortably at 55 with a 60% pension without working. The argument still stands.

I have no particular affection for investment banks but, again, no one forced Greece to borrow on the international capital markets. Greece was happy to find buyers for its bonds but now, somehow, when they want to sell, they become "bad" people?

I am sorry for the honest Greek people who will suffer along with the dishonest ones and I wish Greece gets back on its foot quickly. That's why I suggested a default might make that process faster and easier.

[El Presidente]

I think Aussies know a little about restructuring an economy. We spend the best part of 15 years doing so between 1984-2000. Painful but necessary.

I suppose we and the western world are trying to look into the eyes of the Greeks (living in Greece) and trying to understand if they have the stomach for what needs to be done.

[Leonidas]

May I remind you that the Olympic Committee was found playing 4-4-2 a few years ago? Thank God no Australians or Greeks had any involvement whatsoever.

I read the article. It serves no point other than make things worst.

[El Presidente]

Leonidas I understand your point of dept proportion to GDP (comparison to Japan) however Japan actually produce something, have a regimented tax system and are global leaders in different economic spheres.

[Leonidas]

El Presidente I think you are correct about Japan. I did not bring it up for comparison purposes.

Greece is also producing. We are, for the most part, in the service industry, tourism is an example.