Greece: Euro crisis

[butchersapron]

We don't.

 

[butchersapron]

Sounds good, how do we join the Argentine peso?

Have you identified some dynamic everyone else but you is missing?

This is the time to spit it out out half line boy. Do a full para.

Yeah...

 

[elbows]

Argentina won its freedom from the IMF at quite a price. They had taken loans from them for years before they defaulted, and they made sure to pay the IMF back in full as soon as they could so that they were free from IMF dictates.

 

[butchersapron]

It's ruling class won it's relative freedom due the increasing productivity of the domestic w/c.

 

[elbows]

See one of the problems with defaulting is that it doesnt really reset everything, you still have to end up paying back something if you want to deal with other countries again. At least thats what happens if the overall global system remains intact.

So with Argentina we see stuff like this:

Argentina has won the green light from western governments to negotiate repayment of some $7bn in defaulted debt without an International Monetary Fund review of its accounts, but rules out settling its bill in one year.
Cristina Fernández, the president, announced in a televised message to the nation on Monday night that the 19-member Paris Club’s decision to relax its rule that debt restructurings be accompanied by an IMF programme, meant “God willing, next year we can definitively emerge from default”.

Argentina has spent nearly a decade as a financial market pariah since its default on nearly $100bn in 2001, for which it blames IMF-prescribed policies. But after a tough bond restructuring this year, only about 7 per cent of bonds remain in default, and the spotlight has shifted to Argentina’s Paris Club arrears.



The Paris Club, born out of a meeting between Argentina and its creditors in Paris in 1956 to avert an Argentine default, includes the US, Germany, Spain and Japan among its members and Argentina expects a deal to unlock stalled multi-million dollar investments by companies from member countries.

http://cachef.ft.com/cms/s/0/7262e9f2-f199-11df-bb5a-00144feab49a.html#axzz1cmvuYCrr

 

[butchersapron]

Helps the state for a decade though.

 

[elbows]

Yeah, I wouldn't resent having a percentage of the fruits of my labour go towards repayments if it was done in a manner that protected various important aspects of my country from being sold off or opened up to leeches for decades to come.

 

[Belushi]

Neckshot the fucking lot and start again. There is actually nothing to stop us doing this.

 

[elbows]

Well I'd still resent it in some ways, but at least it wouldn't feel like we were being shafted from all directions with nothing in return but even worse to come.

 

[elbows]

Neckshot the fucking lot and start again. There is actually nothing to stop us doing this.

Some sort of worldwide reset would be a lot more interesting than all these other options I've mentioned in recent posts, and the rather insane stalemate that nuclear weapons bring to the global picture could I suppose enable such things to happen even if a major country didn't join in the fun.

 

[elbows]

Today the media make it sound like the PMs imminent departure is very likely, so that a broad coalition can be formed in an attempt to provide some certainty. Unfortunately its the certainty that greeks will suffer years of terrible pain and have to stomach reforms that leave them worse off long term to boot. Assuming this deal is done then all eyes should return to the streets I guess.

 

[Roadkill]

Neckshot the fucking lot and start again. There is actually nothing to stop us doing this.

Aside from the fact that saying that probably counts as encouraging terrorism or some such shite.

Not that you're not right, of course...

 

[Nylock]

well, papandreiou is out, coalition is in...

 

[elbows]

Elections after the bailout is approved, maybe as late as February, democracy in action

 

[ska invita]

Can someone tell me what exactly does 'fiscal union' in the Euro mean?

Maybe this thread should be renamed just Euro Crisis?

 

[Belushi]

Can someone tell me what exactly does 'fiscal union' in the Euro mean?

Maybe this thread should be renamed just Euro Crisis?

More control by Brussels and Frankfurt of member states tax and spend.

 

[gosub]

Can someone tell me what exactly does 'fiscal union' in the Euro mean?

Maybe this thread should be renamed just Euro Crisis?

Pan EUropean tax collection administered centrally.

 

[ayatollah]

If I was a Greek citizen with voting rights (or same in Italian case) I think I'd be just a tad miffed that some faceless minion of Big Finance has just been placed in situ as my new unelected Prime Minister.

Surely the balloon will really go up now in Greece on the streets. And Ditto in Italy.

Still, from a general propaganda point of view it does rather highlight to the previously politically uninitiated the stark realities of the "democratic" nature of modern bourgeois capitalism.

Did Magna Carter die in vain !

 

[sptme]

Have you seen this interview in the guardian with Newsnight's Paul Mason and the FT's Gillian Tett
http://www.guardian.co.uk/commentisfree/2011/nov/11/the-conversation-eurozone-crisis

Gillian Tett:
the situation calls for very firm, forward-looking action that is almost impossible in a rowdy democratic political system at the moment.

Paul Mason:
I was leaked some bank research and the sliding scale of banks that went bust was so frightening I decided it was impossible to report without causing panic.

 

[teqniq]

Quelle surprise:

A group of hedge funds is threatening to block a last-ditch attempt to save Greece from defaulting on its huge debt pile, unless they are guaranteed a significant payout.....

<snip>

"It's very serious," said market analyst Nicholas Spiro of Spiro Sovereign Strategy. "The notion that a disorderly default by Greece can be ring-fenced is wearing thin and the markets don't believe it." Yet fears have grown in recent weeks that the hedge funds that are blocking the deal – which have been identified as including Vega Asset Management, Och Ziff, York Capital, GreyLock Asset Management and Marathon Asset Management – do not consider the prospect of a disorderly default by Athens as a financial incentive to allow a voluntary writedown deal to proceed.

This is because these funds are believed to have purchased insurance policies on their holdings of Greek bonds, known as Credit Default Swaps (CDS). If Athens fails to pay its maturing debts in March, that would trigger large CDS payouts to these funds from the large financial firms that sold them the insurance. Charles Dallara, the managing director of the Institute of International Finance (IIF), and Jean Lemierre of the French bank BNP Paribas, have been negotiating on behalf of the private sector bondholders. Last night Mr Dallara flew from Washington to Athens and talks will recommence this afternoon....

http://www.independent.co.uk/news/b...scue-blocked-by-hedge-fund-greed-6291112.html

 

[Crispy]

Those CDS beasties again

 

[A Dashing Blade]

Have you seen this interview in the guardian with Newsnight's Paul Mason and the FT's Gillian Tett
http://www.guardian.co.uk/commentisfree/2011/nov/11/the-conversation-eurozone-crisis

She's very good, he's a useless waste of space imo (cf his delusional coverage of the last Greek negotiations)

 

[A Dashing Blade]

Quelle surprise:

http://www.independent.co.uk/news/business/news/greek-rescue-blocked-by-hedge-fund-greed-6291112.html[/quote]

They're not gonna get a payout from Greece, they want their payout from the bank that sold them the CDS if Greece were to default. Note that the paperwork for Sov CDS's is standard stuff, ie terms such as "Default" are clearly defined.
How would you feel if your insurance company tried to wriggle out of compensating you for a claim?

 

[Blagsta]

Fuck off

 

[littlebabyjesus]

How would you feel if your insurance company tried to wriggle out of compensating you for a claim?

They have bought insurance on loans. For the rest of us, that means we have insurance in case we lose our job, etc, and the insurance is there to give us security that we will be able to pay back borrowed money.

This is quite the reverse - a loan is made and insurance bought by the lender in case the loanee defaults. Not a situation any of the rest of us could ever be in.

 

[A Dashing Blade]

. . . and the insurance is there to give us security that we will be able to pay back borrowed money. . .

Or if our car is stolen, house burgled ie insurance is (generically) used to compensate us for the loss of something.

Zero Hedge's somewhat technical take on the Greek CDS issue here is worth a very careful peruse

 

[littlebabyjesus]

Or if our car is stolen, house burgled ie insurance is (generically) used to compensate us for the loss of something.

Personal insurance is taken out so that we can keep promises to others - to pay for their car repairs, building repairs, etc. This is the opposite - it is insurance taken out in case others don't keep promises to us - and what happens then is that the insurer goes after the one who has broken the promise.

This is like having insurance on insurance - insuring your insurance policy in case your first insurer refuses to pay what it promises. All I can say is that they should have taken out insurance on the insurance they took out on the loans. And perhaps they should have taken out insurance on that. And on that. And probably on that too. Insurers all the way down, in fact.

 

[Blagsta]

Or if our car is stolen, house burgled ie insurance is (generically) used to compensate us for the loss of something.

Zero Hedge's somewhat technical take on the Greek CDS issue here is worth a very careful peruse

Hang on, isn't that what interest rates are for?

 

[teqniq]

...How would you feel if your insurance company tried to wriggle out of compensating you for a claim?

hahahaha surely you jest? That is SOP for insurance companies.

 

[A Dashing Blade]

hahahaha surely you jest? That is SOP for insurance companies.

Yup . . . but a hedgie can afford the best lawyers in town . . .