Let’s get those defaults rolling, there is nothing more productive for an economy than gargantuan bank fees. The velocity of that cash once it gets into the hands of the hookers and coke dealers rivals an ICBM.
A feature of reading the the FT Weekend over the last few months has been the ongoing deterioration of the Euro debt crisis . Every so often some market commentator will say there is a turning point and the authorities have got on top of the situation and 2 weeks later the yields will show that they haven’t. There is no equilibrium. The system is banjaxed.
Greece has to sell €50bn of assets and even then it probably won’t have any growth. At what point do the people say “enough” ? Ultimately the financial system is part of the real world.
@ Seafoid: “Ultimately the financial system is part of the real world.”
Yes and no. Yes, if one harks back to pre 1970ish days, the PC economy. Not if one considers the contemporary situation; the FIRE economy is now dominant but has severe atheroschlerosis. Quadruple-bypasses (QEs) are in, but prognosis is poor.
The production of debt has replaced, and overtaken the production of goods and services which could be sold externally, and provided a surplus – after paying down debt.
Now, the debt burden is accelerating (compound interest!), whilst the surpluses from the sale of profitable goods and services cannot pay the debt – you have to hope that your future productive endeavours will somehow (in a clearly un-mathematically manner) surpass your debt deficits. Credit Card delusion: min payment will suffice! You cannot finesse maths and nature. You can indeed try, but its a cul-de-sac career move.
Essentially, unless we are able to return to a lower, more orderly and mathematically and physically balanced level of economic activity, we ‘sweat’.
The clever ones know the score. They have captured the politicians, have slowed (not halted) the default process and will succeed in optimising their asset wealth. The probability of keeping x% of something is better that the certainty of 100% of nothing.
If some dopey hedgie (are there such?) is induced to buy state assets – surely they will want some ‘payback’? So how will they achieve this if the Sheeple have been shorn? Mississippi Land Purchase; South-sea, Tulips, Railroads, .Coms, … the mind boggles at the sheer audacity of human ingenuity. Sell it back to the state?
BpW
Who precisely would be careless enough to buy “Greek Assets”? They would need very strong support from the likes of Blackwater USA. It is one thing to force sales of national assets, another thing entirely to put successful harvesting mechanisms in place. Outside nvestment in Greek infrastructure, if it happens will be pyrrhic.
5 replies on “The State of Greece”
Mr. Regling is not impressed.
http://uk.news.yahoo.com/22/20110501/tpl-uk-greece-debt-restructuring-regling-20b2d2f.html
Neither is the Commission.
http://europa.eu/rapid/pressReleasesAction.do?reference=IP/11/509&format=HTML&aged=0&language=EN&guiLanguage=en
Let’s get those defaults rolling, there is nothing more productive for an economy than gargantuan bank fees. The velocity of that cash once it gets into the hands of the hookers and coke dealers rivals an ICBM.
A feature of reading the the FT Weekend over the last few months has been the ongoing deterioration of the Euro debt crisis . Every so often some market commentator will say there is a turning point and the authorities have got on top of the situation and 2 weeks later the yields will show that they haven’t. There is no equilibrium. The system is banjaxed.
Greece has to sell €50bn of assets and even then it probably won’t have any growth. At what point do the people say “enough” ? Ultimately the financial system is part of the real world.
@ Seafoid: “Ultimately the financial system is part of the real world.”
Yes and no. Yes, if one harks back to pre 1970ish days, the PC economy. Not if one considers the contemporary situation; the FIRE economy is now dominant but has severe atheroschlerosis. Quadruple-bypasses (QEs) are in, but prognosis is poor.
The production of debt has replaced, and overtaken the production of goods and services which could be sold externally, and provided a surplus – after paying down debt.
Now, the debt burden is accelerating (compound interest!), whilst the surpluses from the sale of profitable goods and services cannot pay the debt – you have to hope that your future productive endeavours will somehow (in a clearly un-mathematically manner) surpass your debt deficits. Credit Card delusion: min payment will suffice! You cannot finesse maths and nature. You can indeed try, but its a cul-de-sac career move.
Essentially, unless we are able to return to a lower, more orderly and mathematically and physically balanced level of economic activity, we ‘sweat’.
The clever ones know the score. They have captured the politicians, have slowed (not halted) the default process and will succeed in optimising their asset wealth. The probability of keeping x% of something is better that the certainty of 100% of nothing.
If some dopey hedgie (are there such?) is induced to buy state assets – surely they will want some ‘payback’? So how will they achieve this if the Sheeple have been shorn? Mississippi Land Purchase; South-sea, Tulips, Railroads, .Coms, … the mind boggles at the sheer audacity of human ingenuity. Sell it back to the state?
BpW
Who precisely would be careless enough to buy “Greek Assets”? They would need very strong support from the likes of Blackwater USA. It is one thing to force sales of national assets, another thing entirely to put successful harvesting mechanisms in place. Outside nvestment in Greek infrastructure, if it happens will be pyrrhic.