Two older posts:
Greece: Where are you heading?
Hot News:
European leaders and financial markets braced for Greece exit from euro!!!
Greece Can No Longer Delay Euro Zone Exit
Hot News:
European leaders and financial markets braced for Greece exit from euro!!!
Greece Can No Longer Delay Euro Zone Exit
© Am Ang Zhang 2011
© Am Ang Zhang 2011
© Am Ang Zhang 2011
I returned from Greece after a lovely cruise. Greece has been hit by more financial problems and it was clear that market forces caused much hardship to its ordinary citizens! One taxi driver told me that Greece will never pay back the EU. He may well be right.
A Chinese Story:
The Yangtze River is rising. Man is on the roof. A traditional pigskin boat rowed along: let me get you off.
“No, Buddha will protect.”
Man is now knee-high in water. Naval boat came along: old man, let’s get you off.
“No, Buddha will protect.”
Man is now up to his neck in water. Rescue helicopter came along: let’s winch you off, stubborn old man.
“No, Buddha will protect.”
Man died and saw Buddha. “Why didn’t you come when I needed you most?”
I did, I sent pigskin boat, Naval boat and even my best helicopter, but you refused!
The Greeks have their own Gods, but perhaps they should try Buddha.
So first the Gods sent in Antigone:
So Antigone had a part in this tragedy too. That's Antigone Loudiadis of Goldman Sachs, who arranged a complex currency swap deal that helped Greece to conceal the scale of its debt, in what the Financial Times delicately calls "an optical illusion", as the country snuck into the eurozone.
Then God showed how it could be done in Argentina: defy the I.M.F.
When the Argentine economy collapsed in December 2001, doomsday predictions abounded. Unless it adopted orthodox economic policies and quickly cut a deal with its foreign creditors, hyperinflation would surely follow, the peso would become worthless, investment and foreign reserves would vanish and any prospect of growth would be strangled.
But three years after Argentina declared a record debt default of more than $100 billion, the largest in history, the apocalypse has not arrived. Instead, the economy has grown by 8 percent for two consecutive years, exports have zoomed, the currency is stable, investors are gradually returning and unemployment has eased from record highs - all without a debt settlement or the standard measures required by the International Monetary Fund for its approval.
He even took out the head of I.M.F. just to be on the safe side.
Then came Iceland:
Unlike other disaster economies around the European periphery – economies that are trying to rehabilitate themselves through austerity and deflation — Iceland built up so much debt and found itself in such dire straits that orthodoxy was out of the question. Instead, Iceland devalued its currency massively and imposed capital controls.
And a strange thing has happened: although Iceland is generally considered to have experienced the worst financial crisis in history, its punishment has actually been substantially less than that of other nations.
For good measure Iceland’s god huffed and puffed.
But no, the Greeks have not learned anything.
This was written last year:
Germany will agree to some form of eurozone bailout. However, it will only support the minimum needed to placate the gods, and only with the most astringent, Creon-like conditions being imposed on Greece. It is an important but ultimately secondary question whether this help comes in the form of bilateral loans, loans from the European Investment Bank, purchases of Greek government debt, EU spending transfers, jointly issued eurobonds or any of the other mechanisms suggested. EU leaders will deny that this is a bailout and everyone will know that it is a bailout. Guardian.
The Greeks will do well to go back to their own Gods and not the I.M.F.
© Am Ang Zhang 2011
I returned from Greece after a lovely cruise. Greece has been hit by more financial problems and it was clear that market forces caused much hardship to its ordinary citizens! One taxi driver told me that Greece will never pay back the EU. He may well be right.
A Chinese Story:
The Yangtze River is rising. Man is on the roof. A traditional pigskin boat rowed along: let me get you off.
The Greeks have their own Gods, but perhaps they should try Buddha.
“No, Buddha will protect.”
Man is now knee-high in water. Naval boat came along: old man, let’s get you off.
“No, Buddha will protect.”
Man is now up to his neck in water. Rescue helicopter came along: let’s winch you off, stubborn old man.
“No, Buddha will protect.”
Man died and saw Buddha. “Why didn’t you come when I needed you most?”
I did, I sent pigskin boat, Naval boat and even my best helicopter, but you refused!
The Greeks have their own Gods, but perhaps they should try Buddha.
So first the Gods sent in Antigone:
So Antigone had a part in this tragedy too. That's Antigone Loudiadis of Goldman Sachs, who arranged a complex currency swap deal that helped Greece to conceal the scale of its debt, in what the Financial Times delicately calls "an optical illusion", as the country snuck into the eurozone.
Then God showed how it could be done in Argentina: defy the I.M.F.
When the Argentine economy collapsed in December 2001, doomsday predictions abounded. Unless it adopted orthodox economic policies and quickly cut a deal with its foreign creditors, hyperinflation would surely follow, the peso would become worthless, investment and foreign reserves would vanish and any prospect of growth would be strangled.
But three years after Argentina declared a record debt default of more than $100 billion, the largest in history, the apocalypse has not arrived. Instead, the economy has grown by 8 percent for two consecutive years, exports have zoomed, the currency is stable, investors are gradually returning and unemployment has eased from record highs - all without a debt settlement or the standard measures required by the International Monetary Fund for its approval.
He even took out the head of I.M.F. just to be on the safe side.
Then came Iceland:
Unlike other disaster economies around the European periphery – economies that are trying to rehabilitate themselves through austerity and deflation — Iceland built up so much debt and found itself in such dire straits that orthodoxy was out of the question. Instead, Iceland devalued its currency massively and imposed capital controls.
And a strange thing has happened: although Iceland is generally considered to have experienced the worst financial crisis in history, its punishment has actually been substantially less than that of other nations.
For good measure Iceland’s god huffed and puffed.
This was written last year:
Germany will agree to some form of eurozone bailout. However, it will only support the minimum needed to placate the gods, and only with the most astringent, Creon-like conditions being imposed on Greece. It is an important but ultimately secondary question whether this help comes in the form of bilateral loans, loans from the European Investment Bank, purchases of Greek government debt, EU spending transfers, jointly issued eurobonds or any of the other mechanisms suggested. EU leaders will deny that this is a bailout and everyone will know that it is a bailout. Guardian.
The Greeks will do well to go back to their own Gods and not the I.M.F.
NHS: Business Model? Spare Us Please!!!
The Next Europe: Left-over Euro & Deutschmark
Historian Hans-Joachim Voth gives the euro only another five years unless the euro zone is transformed into a full transfer union with massive redistribution. The continent is too culturally different to warrant a single currency, he says, adding that it would be best ifGermany
SPIEGEL: Professor Voth, how much longer do you think the euro will survive?
Voth: Five years. The euro can't survive in its current form. We could, of course, make a full-fledged transfer union out of the euro-zone countries, complete with euro bonds and massive fiscal redistribution. In that case, we would have a different euro than the one that was originally conceived and promised to German voters. In the end, if the heads of state and government don't want that, it's likely that the euro will have to be dissolved.
SPIEGEL: You give the euro another five years -- what will Europe look like then, in your opinion?
Voth: I can imagine a world where there will a left-over euro: with France , Italy , the Mediterranean countries, perhaps Belgium Germany , Austria and the Netherlands , perhaps Denmark as well, perhapsFinland , which have no problems conducting the same monetary policy as Germany
See also Money Week
Der Spiegel:
Der Spiegel:
- The Ticking Euro Bomb: What Options Are Left for the Common Currency? - SPIEGEL ONLINE - http://t.co/7xU5RGw4
- Contagion!!! Dexia Rescue: Belgium Nationalizes Troubled Bank - SPIEGEL ONLINE - http://t.co/oPNn7FkR
- Berlin, Paris Deny Rift Rumors: EU Postpones Summit on Debt Crisis - SPIEGEL ONLINE - http://t.co/tUmeLN3t
- The Financial Crisis Returns: Europe's Attention Shifts to Its Ailing Banks - SPIEGEL ONLINE - http://t.co/H4Bs0vxP
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