Greek Financial Crisis Thread

[Novus America]

I'm not sure if you've realised yet but no country has yet left the Eurozone. Pretty hard to set a legal precedent from something that would only happen for the first time. Anyway, are you denying that it is in any way possible for Greece to be removed from the Eurozone?

The problem - as I understand it - is that the Lisbon Treaty doesn't have any mechanism by which member states could be ejected; they can only hypothetically leave on their own, which is in itself in pretty murky legal waters. Were it deemed necessary to get rid of Greece, the only mechanism the EU states could use is to ratchet up sanctions high enough or stop cooperating such that Greece would have no choice but to ditch the euro.

But what if Greece responds by cranking out Euros? Also murky legal waters. The EU would have to stop Greece somehow. I guess by creating a mechanism to throw them out. This could get ugly. Plus I am sure there will be lawsuits galore. Well the lawyers get richer.

[Bogdanov Vishniac]

The problem - as I understand it - is that the Lisbon Treaty doesn't have any mechanism by which member states could be ejected; they can only hypothetically leave on their own, which is in itself in pretty murky legal waters. Were it deemed necessary to get rid of Greece, the only mechanism the EU states could use is to ratchet up sanctions high enough or stop cooperating such that Greece would have no choice but to ditch the euro.

I don't think they'd use sanctions, rather the ECB would continue to withhold support the Greek banking system until Greece has no choice but to leave the Eurozone.

Yeah, 'sanction' was probably not the right word to use.

[Natapoc]

No I'm not denying that it's possible to remove Greece. And I'm aware there is no precedent: Which is why your confidence that something there is no precedent for will certainly happen seems odd.

I'm asking that you support your claim by giving an example of how this could legally happen. If you can't you're simply repeating political hyperbole.

So last chance: Support your argument or admit it's political hyperbole.

You're this upset because I said that Greece would be ejected if it pissed off the Eurozone enough even if you literally just admitted that it is a possibility?

I'm not upset in the slightest. But I take this as acknowledgement that you have no argument nor any idea how your stated "likely" outcome could happen without greek cooperation.

I also did not admit that it's possible. I said I don't deny it's possible. Two different things.

[Parti Ouvrier]

That's issuing IOUs.

Which will be pretty much useless for imports. Her argument that there will be no purchasing powers loss for domestic purchases ignores this applies only to entirely domestic products. Of which Greece produces little.

True, its not ideal, a semi-eurozone exit of sorts, life will still go on, we can only speculate 'what next' at this point. To echo Risottia, I also think Syriza have performed rather badly.

[Bogdanov Vishniac]

But what if Greece responds by cranking out Euros? Also murky legal waters. The EU would have to stop Greece somehow. I guess by creating a mechanism to throw them out. This could get ugly. Plus I am sure there will be lawsuits galore. Well the lawyers get richer.

Modifying the rules by which the ECB runs requires the amendments be ratified by all EU members through either acts of parliament or a referendum. That would take years to run its course, and is politically unpalatable for pretty much all of the EU right now. That's just not happening.

[Arkolon]

You're this upset because I said that Greece would be ejected if it pissed off the Eurozone enough even if you literally just admitted that it is a possibility?

I'm not upset in the slightest. But I take this as acknowledgement that you have no argument nor any idea how your stated "likely" outcome could happen without greek cooperation.

It's such a shame NSG threads get filled with people who seem to want to waste their time arguing about how to argue instead of arguing the points people make. If you don't mind, I'm going to go back to talk to the other people who seem to know a bit more about the situation and who equally seem more inclined to talk about the relevant topic at all.

That's issuing IOUs.

Which will be pretty much useless for imports. Her argument that there will be no purchasing powers loss for domestic purchases ignores this applies only to entirely domestic products. Of which Greece produces little.

It is no way to solve anything regarding the Greek crisis and is resorting to the drachma under a different name. Without ELA from the ECB, issuing IOUs and leaving the Euro to use the drachma are one and the same. The arguments of hyperinflation, more expensive imports, and the bust of the fragile banking networks that applied to Grexit also majorly apply to a scenario of Greece issuing IOUs. It's hardly a smart move.

[Parti Ouvrier]

Greece would be kicked out if it angered the Eurozone at an alarming enough level. Whether it pisses off the ECB by printing Euros it isn't supposed to or if it pisses off the Eurogroup by having Varoufakis spit in Dijsselbloem's face doesn't really matter, since all of those European entities are deeply interlinked.

How would they go about kicking Greece out? What legal precedent would exist to do this?

There's also another complication with that. What would kicking out Greece achieve?
http://greece.greekreporter.com/2015/07 ... ys-budget/

[Novus America]

But what if Greece responds by cranking out Euros? Also murky legal waters. The EU would have to stop Greece somehow. I guess by creating a mechanism to throw them out. This could get ugly. Plus I am sure there will be lawsuits galore. Well the lawyers get richer.

Modifying the rules by which the ECB runs requires the amendments be ratified by all EU members through either acts of parliament or a referendum. That would take years to run its course, and is politically unpalatable for pretty much all of the EU right now. That's just not happening.

Well the North Europeans cannot just sit back and let the Greeks print Euros. Plus if Greece starts everybody else in the South might as well start before the Euro collapses too far...

Will the Germans leave then to protect their banks? This Greece can print Euros provision is insane. It does give Greece a powerful weapon.

[Natapoc]

Modifying the rules by which the ECB runs requires the amendments be ratified by all EU members through either acts of parliament or a referendum. That would take years to run its course, and is politically unpalatable for pretty much all of the EU right now. That's just not happening.

Well the North Europeans cannot just sit back and let the Greeks print Euros. Plus if Greece starts everybody else in the South might as well start before the Euro collapses too far...

Will the Germans leave then to protect their banks? This Greece can print Euros provision is insane. It does give Greece a powerful weapon.

Germany leaving will be even worse for German banks and add significant barriers to trade for the German economy.

For all of Europe the least costly option is to stop the austerity and give Greece time to pay the loans. It would be stupid for Europe to significantly harm their own economies simply to "teach Greece a lesson!"

Especially when none of the people who initially caused the issue in greece are still in office. The greek people already taught them a lesson.

[Bogdanov Vishniac]

Modifying the rules by which the ECB runs requires the amendments be ratified by all EU members through either acts of parliament or a referendum. That would take years to run its course, and is politically unpalatable for pretty much all of the EU right now. That's just not happening.

Well the North Europeans cannot just sit back and let the Greeks print Euros. Plus if Greece starts everybody else in the South might as well start before the Euro collapses too far...

Will the Germans leave then to protect their banks? This Greece can print Euros provision is insane. It does give Greece a powerful weapon.

You're being sensationalist. Greece is not going to collapse the eurozone by printing a bit more money.

[Natapoc]

So I have a question: To what extent did polling agencies intentionally mislead the public in the run-up to this election and what was their motivations for doing so?

61% is not even close to any of the polls that were touted here. What methods were used to obscure the actual intent of the Greek people?

[Novus America]

Well the North Europeans cannot just sit back and let the Greeks print Euros. Plus if Greece starts everybody else in the South might as well start before the Euro collapses too far...

Will the Germans leave then to protect their banks? This Greece can print Euros provision is insane. It does give Greece a powerful weapon.

You're being sensationalist. Greece is not going to collapse the eurozone by printing a bit more money.

I am not sure. Think about what that would do to confidence in the Euro. And once they start, a little will not be enough. And why would other countries not follow? The precedent is too dangerous.

[Shofercia]

So I have a question: To what extent did polling agencies intentionally mislead the public in the run-up to this election and what was their motivations for doing so?

61% is not even close to any of the polls that were touted here. What methods were used to obscure the actual intent of the Greek people?

Hey Nat - welcome back! Haven't seen ya for a while.

[Bogdanov Vishniac]

So I have a question: To what extent did polling agencies intentionally mislead the public in the run-up to this election and what was their motivations for doing so?

61% is not even close to any of the polls that were touted here.

Very little, I think. It's been a common theme of elections in the last few years that polls have a limited utility in predicting the actual results of elections. Telephone polls in particular are rife with all sorts of selection biases and psychological quirks.

It could also genuinely be that opinion shifted very quickly in the last few days of the election, particularly considering the release of the IMF report.

You're being sensationalist. Greece is not going to collapse the eurozone by printing a bit more money.

I am not sure. Think about what that would do to confidence in the Euro. And once they start, a little will not be enough. And why would other countries not follow? The precedent is too dangerous.

Well, most of the other countries touted as being in similar circumstances to Greece (ie Portugal, Spain, Italy, and Ireland) are being run by parties that are generally pro-EU and pro-austerity. They really have no interest in rocking the boat like Greece is doing.

[Novus America]

Well the North Europeans cannot just sit back and let the Greeks print Euros. Plus if Greece starts everybody else in the South might as well start before the Euro collapses too far...

Will the Germans leave then to protect their banks? This Greece can print Euros provision is insane. It does give Greece a powerful weapon.

Germany leaving will be even worse for German banks and add significant barriers to trade for the German economy.

For all of Europe the least costly option is to stop the austerity and give Greece time to pay the loans. It would be stupid for Europe to significantly harm their own economies simply to "teach Greece a lesson!"

Especially when none of the people who initially caused the issue in greece are still in office. The greek people already taught them a lesson.

Here is where the politics come in. If they make this a victory for Syriza, Podemos wins in Spain and does the same thing. Then Five Star in Italy. The ECB can lose Greece. Sacrificing Greece to keep Italy and Spain is worth it to them.

[Fremont Forest]

So I have a question: To what extent did polling agencies intentionally mislead the public in the run-up to this election and what was their motivations for doing so?

61% is not even close to any of the polls that were touted here. What methods were used to obscure the actual intent of the Greek people?

Before we jump to conclusions, it's worth pointing out that It's entirely possible that a lot of people simply didn't know how they were going to vote until the last minute, or changed their minds later on, or that the polls were simply inaccurate.

Polling can be a very rough science, and it's one that has had difficulties adapting to rapidly changing technologies, and means of communications.

[Shofercia]

And the Greeks voted "no!" If the Troika wants Greece in the Euro, they should pipe down and figure out a way to get Greece out of the current situation without austerity.

That is literally impossible. Hence the problem. Greece gets austerity in or out. Even if the debt was forgiven austerity would continue. Maybe they can make the austerity less harsh. But Greece will not accept that.

If the EU gives in the EU is done, because everybody else in the PIIGS will do the same thing. And the ECB will collapse.

You do know that FDR got the US out of a bigger crisis in the 1930s without austerity, right? If the debt would be forgiven and proper reforms enacted, austerity wouldn't continue, because there'd be no need for it. The only way to recover under austerity includes either some weird financial machinations, fucking your most vulnerable classes, or emigration. There's no other way to recover under austerity. It just doesn't exist.

[Novus America]

So I have a question: To what extent did polling agencies intentionally mislead the public in the run-up to this election and what was their motivations for doing so?

61% is not even close to any of the polls that were touted here.

Very little, I think. It's been a common theme of elections in the last few years that polls have a limited utility in predicting the actual results of elections. Telephone polls in particular are rife with all sorts of selection biases and psychological quirks.

It could also genuinely be that opinion shifted very quickly in the last few days of the election, particularly considering the release of the IMF report.

I am not sure. Think about what that would do to confidence in the Euro. And once they start, a little will not be enough. And why would other countries not follow? The precedent is too dangerous.

Well, most of the other countries touted as being in similar circumstances to Greece (ie Portugal, Spain, Italy, and Ireland) are being run by parties that are generally pro-EU and pro-austerity. They really have no interest in rocking the boat like Greece is doing.

For now.
http://uk.mobile.reuters.com/article/id ... 5?irpc=932

[Novus America]

That is literally impossible. Hence the problem. Greece gets austerity in or out. Even if the debt was forgiven austerity would continue. Maybe they can make the austerity less harsh. But Greece will not accept that.

If the EU gives in the EU is done, because everybody else in the PIIGS will do the same thing. And the ECB will collapse.

You do know that FDR got the US out of a bigger crisis in the 1930s without austerity, right? If the debt would be forgiven and proper reforms enacted, austerity wouldn't continue, because there'd be no need for it. The only way to recover under austerity includes either some weird financial machinations, fucking your most vulnerable classes, or emigration. There's no other way to recover under austerity. It just doesn't exist.

The situation was different. The U.S. had credit and its own currency, taxation that worked plus tons of natural resources. Greece has none of these.

Austerity would still be needed because Greece would still have not enough money. And nothing to invest.

[Bogdanov Vishniac]

Very little, I think. It's been a common theme of elections in the last few years that polls have a limited utility in predicting the actual results of elections. Telephone polls in particular are rife with all sorts of selection biases and psychological quirks.

It could also genuinely be that opinion shifted very quickly in the last few days of the election, particularly considering the release of the IMF report.



Well, most of the other countries touted as being in similar circumstances to Greece (ie Portugal, Spain, Italy, and Ireland) are being run by parties that are generally pro-EU and pro-austerity. They really have no interest in rocking the boat like Greece is doing.

For now.
http://uk.mobile.reuters.com/article/id ... 5?irpc=932

Spanish parliamentary elections are 5 months away. For all we know, the crisis could be solved by then. Besides which, even if Podemos or won huge majorities in the elections they still would have nothing to gain by trying to break the eurozone or by doing their own quantitative easing. Their economies are in nowhere near as bad of shape as Greece's.

[Sir Cumberbun of Gloucester]

So I have a question: To what extent did polling agencies intentionally mislead the public in the run-up to this election and what was their motivations for doing so?

61% is not even close to any of the polls that were touted here. What methods were used to obscure the actual intent of the Greek people?

http://www.bbc.com/news/world-europe-33403665

It's official. The vote is no.

[Shofercia]

You do know that FDR got the US out of a bigger crisis in the 1930s without austerity, right? If the debt would be forgiven and proper reforms enacted, austerity wouldn't continue, because there'd be no need for it. The only way to recover under austerity includes either some weird financial machinations, fucking your most vulnerable classes, or emigration. There's no other way to recover under austerity. It just doesn't exist.

The situation was different. The U.S. had credit and its own currency, taxation that worked plus tons of natural resources. Greece has none of these.

Austerity would still be needed because Greece would still have not enough money. And nothing to invest.

Let's for the sake of the argument, presume that Tsipras magically transformed into FDR. Oh no, he cannot walk! Anyways,

Credit and Currency - Greece can plan this out. As Balt pointed out, it's something that Tsipras should've done.
Taxation - it didn't work because ND/PASOK didn't collect taxes properly. An IRS style organization can get the job done.
Natural Resources - Greece has amazing real estate. I'm genuinely looking to invest.

[Shofercia]

For now.
http://uk.mobile.reuters.com/article/id ... 5?irpc=932

Spanish parliamentary elections are 5 months away. For all we know, the crisis could be solved by then. Besides which, even if Podemos or won huge majorities in the elections they still would have nothing to gain by trying to break the eurozone or by doing their own quantitative easing. Their economies are in nowhere near as bad of shape as Greece's.

The EUrocracy solves something in less than 5 months. Ha. Haha. Hahaha. *Breaks into laughter*

Granted, your second point might or might not be true, but first point is highly unlikely.

[Bogdanov Vishniac]

Spanish parliamentary elections are 5 months away. For all we know, the crisis could be solved by then. Besides which, even if Podemos or won huge majorities in the elections they still would have nothing to gain by trying to break the eurozone or by doing their own quantitative easing. Their economies are in nowhere near as bad of shape as Greece's.

The EUrocracy solves something in less than 5 months. Ha. Haha. Hahaha. *Breaks into laughter*

Granted, your second point might or might not be true, but first point is highly unlikely.

The longer the crisis goes on, the greater the pressure is on Syriza to just bite the bullet and drop the euro. The troika knows that just as much as Syriza does, so the more this goes on the greater pressure they'll be under in turn to end the crisis definitively. Doubly so considering the US is now leaning on the IMF and probably its European allies as well.

[Novus America]

For now.
http://uk.mobile.reuters.com/article/id ... 5?irpc=932

Spanish parliamentary elections are 5 months away. For all we know, the crisis could be solved by then. Besides which, even if Podemos or won huge majorities in the elections they still would have nothing to gain by trying to break the eurozone or by doing their own quantitative easing. Their economies are in nowhere near as bad of shape as Greece's.

http://www.forbes.com/sites/mikegonzale ... ilds-play/

Podemos has already promised to do similar things.