What if Greece…
…were to disappear, asks Bloomberg View writer Leonid Bershidsky:
As Tim Edwards, senior director at S&P Dow Jones Indices, pointed out recently, “If Greek equities, Greek bonds and Greek GDP disappeared, it would certainly be a tragedy, but not of epic and globally destructive proportions.” That’s because the combined free-float capitalization of the Greek stock market — at about 19 billion euros ($21 billion) — is just 0.2 percent of the EU equity market, Greece’s GDP is 1.5 that of the EU’s and its exports and imports hover about 1 percent of the EU volume.
There is, of course, the debt — 324 billion euros. But very little of that is liquid or market-based…
If EU member Greece just disappeared and re-emerged as Hellas, a newly non-EU state, leaving its debt behind, it would be just like the countries that emerged from the Soviet Union’s breakup. They, too, had clean slates, because Russia assumed responsibility for their debts. There was a lot of purely psychological fallout, of course, including a fallen-empire complex for many Russians and a reallocation of trust in the markets. Yet the EU is probably better able to handle this than was Russia in the early 1990s: It is much stronger economically and more enlightened about how the world works. By getting rid of Greece, the EU would also send a message to current and aspiring members that it’s got some standards.
I’m not at all sure that the EU does have standards, however.
[NOTE: Britain isn’t especially sanguine about the repercussions of the Greek economic crisis.
More here.]
Funny you should mention this. A few of us at work were thinking about buying Greece. But the debt is a little disturbing…
Too bad they don’t have the Spartan thing going for them any longer – Kerry could contract a few of them to take care of the Iranians.
Yes, the EU has standards but are all inclined to one degree or another to superintendence derivatively despotic and not a one of them include national sovereignty. The Greek Left have it in for the banksters, and that’s a good thing and might well appeal to conservatives of a certain nationalist/traditionalist bend.
Also from Zerohedge re Iceland:
re Iceland:
As a reminder, this year Iceland will become the first European country that hit crisis in 2008 to beat its pre-crisis peak of economic output. In spite of its total 180-degree treatment of nefarious bankers, the banking system, and the people of its nation when compared to America (or The UK), Iceland has proved that there is a different (better) option that western dogma would suggest: imprisoning the bankers and letting the banks go bust. Here’s what happened next:
Before anything, first. sovereignty. Second the law — the imprisonment of the banksters and their government colluders. An alliance between Left and Right to get freedom back — now there’s a revolution devoutly to be wished.
I think Barney Frank might like it in prison.
Assuming it was just Greece. Italy, France, and Ireland are all in deep trouble, at least. Hasn’t anyone ever played domino tipping before? One of my favorite games… so long as someone else is doing the setting.
Salubrious as it might be for “Hellas” to emerge debt-free, the unfortunate fact is that modern Greece has a significant number, perhaps a majority, of people without any kind of a work ethic. So there’s that.
Although I feel bad for the Greek people, I’m not worried about the impact of Greece on the European stock market. There is nothing there which the markets haven’t already discounted. When the Greeks elected a hard leftist their present plight was a foregone conclusion.
Jim Cramer of CNBC notes that Greece only has 11m people but its sovereign debt is owned throughout the EU.
The real problem would be a complete collapse of the Greek economy with mass migration. With 26% unemployment, things could get way worse.
The Greeks may soon learn the Maggie Thatcher principle. The problem with socialism is sooner or later you run out of other people’s money. I believe Churchill said the advantage of socialism is it spreads the misery around equally.
The original article cited is of a fool.
The ENTIRE focal point at this time is WHO is going to get stuck with the imploding debt.
Those taking it in the shins will be Germany, France, Austria, Netherlands, …
Further, the boys previously exporting capital goods from Austria, France and Germany are going to see their ‘action’ entirely dry up.
https://www.youtube.com/watch?v=yBDjHARCu64
France was the primary designer of the Corinthian bridge.
Most of the big bucks evaporated when Athens signed up for infrastructure improvements with imported talent and materials.
A staggering fraction of that went down the drain in Greece’s national railway.
&&&&
The repercussions will hit Berlin, Vienna and Paris. Their politically favored exporters will be crying.
As for the bleeding: I’d say that it’s going to be shoved onto the taxpayers of the creditor nations — in a very loopy, round about, process.
&&&&
And, the crazy 1:1 rigid exchange rate regime is in peril.
It’s a multi-player game that has no certain outcome — other than the historical trajectory towards a catastrophic breakup at the end of the game.
For all those who discount libertarians as loons like Ron Paul (and his son) there is a question you should ask yourselves. Who or what is going to bail us out when WE default?
If history is guide it will be war.
Other Chuck.
We don’t default. We debase the currency.
Cornhead:
Debase capital and labor. We have already made remarkable progress with debasing human life.
The Greeks may soon learn the Maggie Thatcher principle
If so, they will be the first. The Brits haven’t.
If history is guide it will be war
I’m sure the libertarians (those who proclaim advances in tyranny as freedom) will get on that right away. And successfully, too, at least in their own objective minds.
In the center of greek community in ny, you can see their ferraris, maseratis, bugatis, lamborghinis…. all parked on the street while their fathers toil in the greek businesses… most others, dont have it that way… they sell “souvlaki on a stick”, and so on…
basically the wealthy greeks send their kids to live in the US away from greece and with the ability to have transfered their wealth outside of greece a long while ago, operating from other locations where greek government cant reach them.
as for the resident greeks… not so much…
on the aside..
the press is sure making sure to tell us the race of the church massacre person, fulfilling the prediction that if a caucasian does something, it will be hollared from the top of the world…
however, the press is avoiding printing the killers picture as he is tanned and has that bowl on the head cut that wealthy kids have (you know, a girls ice skater bob on a very young teen boy), and is also common among young columbians.
on another note, what would happen if they find out its an ISIS sympathizer, and not a tanned white supremicist? in fact, the clothing, hair and such does NOT point to a white supremicist, who tend to be very white, not tanned, have tatoos, and wear leathers… this one is young, very young, and wearing college clothing…
it will be interesting as it turns out.
sad for the victims.
but every leftist has taken up the programmed agenda talking points… that gun control would have stopped that person (despite mass murder being a bigger crime than gun posession)… that whites are the racists, and the “teens” do nothing… and that even if he is spanish, he is white… just as a man is a girl, a dog is a cat, and white women can be black..
Greek Debt Committee Just Declared All Debt To The Troika “Illegal, Illegitimate, And Odious.”
I like this Greek concept of “Illegitimate and Odious” debt …
Somewhere stereotypes are smiling.
Killer identified.. 21-year-old Dylann Storm Roof
telling them – ‘I have to do this. You rape our women and you’re taking over our country’
received a gun from his father for his 21st birthday in April,
now comes the dissection…
is he on the left, right, or some crazy space in between worlds?
Recently Faced Drug Charges
A Facebook page purportedly belonging to Roof identified him as a Columbia, South Carolina resident who attended White Knoll High School in Lexington, South Carolina.
I solve my problems and I see the light
We got a lovin’ thing, we gotta feed it right
There ain’t no danger we can go too far
We start believing now that we can be who we are
Greece is the word
They think our love is just a growing pain
Why don’t they understand, it’s just a crying shame
Their lips are lying, only real is real
We stop the fight right now, we got to be what we feel
Greece is the word
It’s got a groove, it’s got a meaning
Greece is the time, is the place, is the motion
Greece is the way we are feeling
We take the pressure and we throw away
Conventionality belongs to yesterday
There is a chance that we can make it so far
We start believing now that we can be who we are
Greece is the word
the international bankers version of Grease
Artfldgr Says:
June 18th, 2015 at 11:38 am
…
I’d like to add:
World Is “Looking More and More Like Immense Pile of Filth”
Nice to be infallible …
I have a friend, older, retired, German born but US citizen after WWII, settled in Greece a decade ago after marrying a Greek woman he met in L.A. at the airline where he worked. He cannot stand the Greek mentality: keep telling you they invented democracy but are Socialist through and through, won’t work, expect to be paid anyway. In a word, he says, LAZY. Oh, and entitled. Sounds like a lot of people right here in the USA. And we’re certainly on the same track. Wouldn’t it be wonderful if some pop star or Hollywood movie were to come along that glorified the dignity of labor? Sorry if that caused you to spit hot coffee on your computer screen in laughter.
The issue of Greece leaving was never about the size of their economy or debt; that’s a drop in the bucket. The issue is the precedent they set for other troubled Euro-area countries.
To that end, if Greece leaves (as seems increasingly likely) I bet that the EU makes the experience as painful as possible to discourage others from going the same route.