Economy threads aren't exactly common in gaming forums, but here's one for a change.
If you switched on a tv in the last 6 months I'm sure you have an idea of the current situation of europe's economies.
Yesterday I was shocked to hear the news that the greece pm has called for a referendum on the european union's bailout plan. Right when we were beginning to have some hope and the markets started to react positively, an incredibly irresponsible and incomprehensible political move threatens to throw it all away and make things even worse.
I really don't know what the hell went through the greece pm's head to do this. Only a week or something after it was announced that about half of greece debt would be forgiven this sounds like he's playing around with those who offered to help the country stay afloat.
Should this referendum go forward, greece is almost certain to go bankrupt. The people in greece will act instinctively against the measures, without having a clue of what will ensue if the country goes under. In addition to greece's internal collapse, this will cause severe problems to the other struggling european economies namely portugal, ireland, spain and italy, and probably affect the whole world as well. With this in mind, europe's confidence in greece will be destroyed for good so I can't imagine them staying in the ue for much longer.
What do you think the UE should do if the referendum goes forward and is not passed ? Should greece be thrown out of the UE ?
btw it would be interesting if someone from greece or living in greece gave us an inside view of the situation.
edit: aparently the greece pm is also due to go through a confidence vote soon. I suppose his decision to call for a referendum has something to do with this. Needless to say, it backfired and badly.
Sounds a lot like the assinine company bailouts we had over here in the US. But then again, our government is owned by big corporations that get handouts left and right, and then complain when the people finally protest against it. Rich get richer, poor get poorer.
I generally don't like to talk about it too often though, because it CAN be a controversial topic, though I'm not sure why it would be... facts are facts, the controversy is who chooses to listen to what facts or worse but unfortunately more common, who can make up the most believable facts fast enough.
I'm from the US too, and I haven't been following the news in a while since I've been really busy, but I don't buy into all that nonsense about being owned by large companies. Mostly because we as the consumers can simply stop buying their products and their power is gone.
Sure it takes money to make money, but these companies all started from the bottom at some point.
I agree that bailouts should not be given to these companies, but you can thank the government for that.
And poor get poorer because they make bad decisions.
"A fool and his money are soon parted"
Bailout's can be a good thing but it really depends upon the recipient's competency to use the money wisely.
For industry (such as automotive) I would support bailouts for example. Typically for every person on the track it is said there is 20 plus employed in support industries. I personally know of one major deprived area of the UK due to the closure of a car plant (lots of skilled labour that has nowhere to work).
On topic I have always doubted the plausibility of a single currency across multiple nations (I expected problems, not being able to control the value of your own currency is IMO a dangerous thing), but I think calling a referendum on the bailout is a highly risky move. If Greece defaults there will be a run on the banks of Ireland, Italy, Portugal and I have read of the possibility of Spain - which will cause the collapse of the EU economy and the Western economy as a whole.
There are also rumours of Greece pulling out of the EU, which would also probably cause a run on the banks.
Originally Posted by . : UrbanMonk : . I'm from the US too, and I haven't been following the news in a while since I've been really busy, but I don't buy into all that nonsense about being owned by large companies. Mostly because we as the consumers can simply stop buying their products and their power is gone.
Sure it takes money to make money, but these companies all started from the bottom at some point.
I agree that bailouts should not be given to these companies, but you can thank the government for that.
And poor get poorer because they make bad decisions.
"A fool and his money are soon parted"
And this is what I'm saying... you either don't know enough and/or watch national news media, and think everything's fine, or you actually learn what's going on and start to fight against it.
Which is why I said, it's not really controversial if opinion isn't the defining factor... but sear awareness. Something most people aren't willing to obtain, yet they still voice an opinion in politics.
There are two things people shouldn't talk about in public: religion and politics
Religion is too personal.
Politics is too ignorant.
Well there's no single solution for fixing everything, but one step would be to simply severely limit corporation funding of elections so that our candidates don't feel compelled to suck their willies once they finally get elected. Should they be allowed to fund the government? Government should be taxing extremely wealthy corporations instead of getting handouts from them.
Quite simply...
When corporations can just decide to fund money toward elections instead of being taxed, the government is obviously going to be black mailed into returning the favor. Government decides to stop giving them a break, corporations stop feeling so compelled to throw a few bucks there way.
Honestly... a majority (68%) of the wealthy actually say, while in their own personal interest they don't want to be taxed, they understand that it would necessarily to pay more in taxes, to help the economy. So why isn't the government taxing the rich more?
"I don't really know what else to spend it on, I think if you took more from me in taxes I wouldn't decrease spending at all. You'd just be taking a little bit from my savings."
"Hey, you know what, honestly in my own self interest, I really don't want to be taxed more, but on the other hand I really think the country needs it. So I think the best thing to do would be to increase my taxes so the country could be in better shape and it would be better for all of us."
Are you familiar with the Koch Brothers? If not, than no offense intended... but I really don't think you're informed enough to discuss this. They have parts of the government so bought over, it's like a bitch on a short chain leash tight around the neck. And when I say no offense, I really do mean it. I mean, you even admitted yourself, that you haven't been following the news in a while since you've been busy, and that's fine... but you can't have an informed discussion without being informed.
And don't get me wrong, I'm FAR from the most informed person in the world. But read up on some of this stuff. CurrentTV would probably be a good source, or TYT Network, or just browse the internet in general. Avoid major news media outlets. They're owned by large corporations and are constantly feeding down letters from the top saying "Don't say this. Instead say this." "Avoid these words, use these words instead."
And no, I'm not expecting a handout from anyone. I work hard at my job and I'm constantly insisting to them that I'm trying to move up and that I want to get forward. I'm not sitting around saying "Oh woah is me, I'm a victim of the economy. Boo hoo." No, me and every other person in this household works their ass off every day and we can barely afford to stay stay afloat. If you're not in that kind of situation, that's fantastic... but don't ignore those of us who are.
hagar: Personally I don't think the problem is the euro itself, on the contrary so far it proved to be a great asset to the EU, having surpassed the dollar in very few years. The problem is the over reliance of some economies when it comes to borrowing money, it was only a matter of time before this whole crisis happened. What's turning it even worse is the inability of greece to create solutions and rebuild or at least patch their economy. Both ireland and portugal seem to be doing well so far but if greece collapses all their efforts are immediately put in the line. If spain and italy get in a similar situation then europe's pretty much screwed because they have significantly bigger economies which means no bailout could save them unlike greece, portugal and ireland.
By the way, from what I read today the greek pm finally realized how idiotic his idea of a referendum is and said he was ready to drop it, which is definitely good news even if some damage is already done, both to his credibility and to the markets.
@ Silveraura: Have a look at some of this information, particularly about PACs and "Super PACs" in specific:
"...officially known as “independent-expenditure only committees,” which can raise unlimited sums from corporations, unions and other groups, as well as individuals. The super PACs were made possible by the Citizens United v. Federal Election Commission decision by the Supreme Court, which lifted many spending and contribution limits. The groups can also mount the kind of direct attacks on candidates that were not allowed in the past. Super PACs are not allowed to coordinate directly with candidates or political parties and are not required to disclose their donors."
What a mess. I've been following-up on this stuff lately, and here's an interesting comment, posted yesterday (7th November):
They've cancelled the referendum. The Greeks really have no choice but to swallow the austerity measures. They're right to have their national pride, but reality looms. There's also a convergence of strategic interest between the Northern Europeans and the Southern states of the EU. A massive economic collapse could lead to a dissolution of the alliance, and Europe needs all the members it can get - both for military security and market leverage.
Living in the Netherlands, I am familiar with the euro crisis. And actually it's a debt crisis, not euro crisis, since the euro is still holding it's value strong.
So Greece has a lot of debt and is missing the money to pay it's debt. In the old days, the Central Bank of Greece could easily print money in order to pay it's debt. This is what all other countries do when it's needed, just print a little bit of money. If you print too much money hyperinflation could occur, something the Germans are well known for in history. The Germans aren't keen on hyperinflation.
So in these new days with our euro, the European Central Bank (ECB) controls the euro and printing of money. So Greece can't print their own money and the ECB isn't keen on it too, because of the Germans. Another solution is thus needed to acquire money.
Above actually is the short and simple version, because the EU has 27 members (countries) and 17 of them use the euro. Those 27/17 members have to come up with a plan in order to help Greece, just like they did with Ireland and Portugal. So there are two groups, the inner and outer core, talking too each other in order to come up with a plan. A plan involving the European Financial Stability Facility (EFSF).
That's just a scheme to buy more time to come up with the real solution. But the politicians don't seem to be able to make up their mind of have problems reaching an agreement with all of the members. Because every member has veto and can kill the plan.
Greece and everyone else has profited from the euro by being able to lend money at very cheap price. Rating agencies probably thought that all euro members are alike and probably assumed this for the risks too. When in fact there are big economic differences between the Northern and Southern European countries, like competitiveness, retirements, pensions, etc... Also when the economic tide was prosperous nobody cared about the budget deficits of the countries. And those deficits are responsible for accumulating the debt of the various countries.
And I should probably stop here, because this story is just my understanding of the crisis based on the facts I know of. One last thing: The economic differences between the European countries is something that should have been solved before creating the euro or it's predecessor. Because Northern European states don't want to bleed for the mistakes of the Southern ones. Credits vs debt is what can cause a brake up. But for now each country of the EU is falling apart one by one, where does it end?
- serve as a deterrent to other politicians to not attempt similar things
- boost public morale
- Even paying of a small portion of the debts would reduce the interest that has to be paid
- Ok, you must admit that was the most creative cussing this site have ever seen -
European members who didn't care about the Stability and Growth Pact (this pack sets limits and money, but only soft limits like telling a drug addict that he needs to stop).
The people in power at the moment, but also the previous governments and the ones before that.
The rating agencies which say: we don't expect our money back from Greece (or other insolvent countries).
The financial money dudes who blindly follow this advice (sure it's a good thing, as is common sense).
The people who elected the politicians. The politicians who think that lending is for no cost or risk.
The people lending to the politicians who think they will get their money back anyway.
But the approval of debt stockpiling among all people, poor, rich, smart, stupid, private, public, everyone ... something with a flock of sheep.
Sure politicians can be held responsible, that's by electing a better (or at least: another, because sometimes there is no better) government . They could be made privately responsible, but this gives rise to the problem of a very big risk for being a politician and less or even no one would go into politics.
It would be better to have professional politicians, but that imposes restrictions on democracy. Because in democracy every moron can be elected and we have them here in Holland. Not referring to any party or person in particular. So these problems occur, but the government officials (the skilled workers) are the ones that should balance these problems.
So who will be held responsible?
Perhaps the people lending out the money? Perhaps the ones that built this financial system? The inventors of the European Coal and Steel Community?
Originally Posted by Fordom All we need to know right now is: who is responsible?
I know.
IT's the enlightend ones... who have a certain...religion. ..Ehem!
You mean christianity?
- Ok, you must admit that was the most creative cussing this site have ever seen -
- serve as a deterrent to other politicians to not attempt similar things
- boost public morale
- Even paying of a small portion of the debts would reduce the interest that has to be paid
I also think it would prevent those same individuals from making the same mistakes/ethical shortcuts that put the eurozone in that mess in the first place.
I really don't see any point in short-term solutions, as the same strategies will simply be used by someone else in power who does it in a more clever way. To have any lasting change, one must abolish the government. Short and sweet: I like Hayo's contingency plan.
The Europe crisis is actually not a Europe or EU crisis, but a debt crisis on a more general level, that concerns most Western economies. It's a harsh fact that the quality of life that we have today, is built by debt and is not sustainable. Take US for example; http://www.usdebtclock.org/ : 15 trillion dollars, that is 15 thousand billions. Illustration on how much really is 1 trillion dollars: http://youtu.be/GNFb6qe7Tmg
if you want to understand the crisis, you should read the economists who knew this was going to happen and can give a clear explanation as to how it happened (nevermind the guys in control who caused the crisis, didn't see it coming and are making it worse). The root cause of the problem is government/central banks monopoly control of the money supply. The solution is to let the market decide and compete on the best money, and for the market to decide interest rates (not central planning banksters) politicians and bankers like to control the money supply, they try to act like they're doing it for the common good.. but it's not true.. this is not some conspiracy theory mind you.. it's just people doing what they've always done, trying to live at the expense of others, inflation of the money supply is the root of all evil!
Originally Posted by Dave C [...]it's just people doing what they've always done, trying to live at the expense of others, inflation of the money supply is the root of all evil!
Some nice Austrian economic theory stuff in there from you, Dave C.
In response to your quote above...Many people go so far as to say a fiat currency system is the root of all evil. In other words, when a government stops backing up their currency with gold stored in a safe somewhere, simply printing money and saying they're "good" for it, and even goes so far as to allow banks to manufacture more paper money by charging interest...That causes problems: inflating the money supply and lessening the value of the money itself.
I agree, no group of people should have the monopoly right to the production of money.. it seems like a crazy thing to say I'm sure.. but if you understand the complexities of an economy, it's an insane thing to believe that a group of central planners can ever know what the 'proper' supply of money is, or the 'ideal' rate of interest.. they have clearly failed! let's get rid of them! return money to the people!
heres a video EVERYONE can enjoy, no 'boring' lectures, no pages of text.. a rap battle on this very issue!
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Edited by Johnny Look
jenswa.neocities.org
who have a certain...religion. ..Ehem!
