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  #21  
Old 11.05.2011, 18:09
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Re: Greece discussing leaving the Euro Zone (Spiegel Online)

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It only makes sense, if a "haircut" of the debt comes into place (50% is probably not too low).
Otherwise, as the debt will still be in Euro-currency, the amount will explode in New-Drachme or whatever it will be called.
well, any return to the drachma will probably be accompanied by debt restructuring. if not through a direct haircut, then most likely by re-denominating euros into new drachma which will then helpfully be worth a lot less than the original euro loans.
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  #22  
Old 11.05.2011, 20:04
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Re: Greece discussing leaving the Euro Zone (Spiegel Online)

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Huh? I think the opposite is true based on Rainers valid points: "Tell your people the truth and finally act accordingly or we kick you out of the Euro" seems a perfect threat towards the Greek government from the EU side...
Good thoughts but "kick you out of the Euro" is not a valid threat.
It would destroy people's confidence in the other weak countries & cause a run on the euro.
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  #23  
Old 11.05.2011, 21:56
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Re: Greece discussing leaving the Euro Zone (Spiegel Online)

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Good thoughts but "kick you out of the Euro" is not a valid threat.
It would destroy people's confidence in the other weak countries & cause a run on the euro.
The difference between Greece and (to my knowledge) most other countries is that the Greek lied for many years on key economic metrics that were part of the application to be allowed in in the first place.

I love the idea of the EU, making Europe finally a peaceful place. But the way the politicians are doing it is just wrong in so many ways... I am all for a "separate speeds" EU - the ones who get their act together move on and do not have to wait for the weakest link... or all members get slowed down to a standstill by vetos from single countries. So every country could choose "how much EU" they want individually.
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  #24  
Old 11.05.2011, 23:54
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Re: Greece discussing leaving the Euro Zone (Spiegel Online)

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The difference between Greece and (to my knowledge) most other countries is that the Greek lied for many years on key economic metrics that were part of the application to be allowed in in the first place.

I love the idea of the EU, making Europe finally a peaceful place. But the way the politicians are doing it is just wrong in so many ways... I am all for a "separate speeds" EU - the ones who get their act together move on and do not have to wait for the weakest link... or all members get slowed down to a standstill by vetos from single countries. So every country could choose "how much EU" they want individually.
Completely agree, sadly they let Greece into the euro zone too soon (in my view)!
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  #25  
Old 12.05.2011, 00:04
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Re: Greece discussing leaving the Euro Zone (Spiegel Online)

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The difference between Greece and (to my knowledge) most other countries is that the Greek lied for many years on key economic metrics that were part of the application to be allowed in in the first place.

I love the idea of the EU, making Europe finally a peaceful place. But the way the politicians are doing it is just wrong in so many ways... I am all for a "separate speeds" EU - the ones who get their act together move on and do not have to wait for the weakest link... or all members get slowed down to a standstill by vetos from single countries. So every country could choose "how much EU" they want individually.
the lie was known to all and happily overlooked by EU bureaucrats who want political union at any cost.
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  #26  
Old 12.05.2011, 00:22
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Re: Greece discussing leaving the Euro Zone (Spiegel Online)

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According to latest news there are discussions to have greece leaving the euro zone.
This will only make things worse. Greece in reality cannot afford to launch a new currency. As it would or will be a NEW currency. The old one right at this time is NOT existing.
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  #27  
Old 12.05.2011, 00:29
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Re: Greece to leave euro zone (Spiegel Online)

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According to German Finance Ministry estimates, the currency (Euro) could lose as much as 50 percent of its value, leading to a drastic increase in Greek national debt. CHF CHF ching ching good currency to have then? I doubt Greece would leave though.
If they launch a new currency, this new currency will NOT enjoy much trust and will lose as much as 80% of its nominal value within a very short time.
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  #28  
Old 12.05.2011, 00:47
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Re: Greece discussing leaving the Euro Zone (Spiegel Online)

How about getting rid of Greece? It's just causing problems all the time...
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  #29  
Old 12.05.2011, 00:54
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Re: Greece discussing leaving the Euro Zone (Spiegel Online)

scroll down for some pictures of today's demonstrations

http://www.alfavita.gr/artro.php?id=32247

apparently, one man is fighting for his life and several other people have been injured

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  #30  
Old 12.05.2011, 00:59
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Re: Greece discussing leaving the Euro Zone (Spiegel Online)

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the lie was known to all and happily overlooked by EU bureaucrats who want political union at any cost.
What is the expression? Something like "you reap what you sow"?
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  #31  
Old 12.05.2011, 01:06
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Re: Greece to leave euro zone (Spiegel Online)

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Needless to say it's popular with the receiving states and not so popular with the states that have to pay (of which there are only 3).
so germany gets nothing from the euro? why doesn't Germany leave the Eurozone? that would leave the single currency shared by economies with similar growth levels
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  #32  
Old 12.05.2011, 01:11
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Re: Greece discussing leaving the Euro Zone (Spiegel Online)

Since I was little kid they were demonstrations in Greece. Most of the times around November due to a well known anniversary and many sporadic ones because people wanted to complain (its part of our Greek culture). In most of the demonstrations there was blood, sweat, swear, police, damages etc etc....
Nowdays that the Tsunami in Asia has calmed down, the radiation is there but the media dont digg too much, Bin Laden is dead, something has to be broadcasted......
Spain, Portugal, Ireland are not in such critical state and therefore there is not such coverage.
UK a couple of years ago hit hard on the recession and even there were demonstations and caualties..

Like any other storm it will pass. It all depends which newspaper and what website you read.

PS: I am still going on holidays there next month and i am sure i wont find what it was described previously
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  #33  
Old 12.05.2011, 01:12
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Re: Greece discussing leaving the Euro Zone (Spiegel Online)

In the end, Greece will be bailed out by the EU. There is no realistic alternative.
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  #34  
Old 12.05.2011, 01:18
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Re: Greece discussing leaving the Euro Zone (Spiegel Online)

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Since I was little kid they were demonstrations in Greece. Most of the times around November due to a well known anniversary and many sporadic ones because people wanted to complain (its part of our Greek culture). In most of the demonstrations there was blood, sweat, swear, police, damages etc etc....
Nowdays that the Tsunami in Asia has calmed down, the radiation is there but the media dont digg too much, Bin Laden is dead, something has to be broadcasted......
Spain, Portugal, Ireland are not in such critical state and therefore there is not such coverage.
UK a couple of years ago hit hard on the recession and even there were demonstations and caualties..

Like any other storm it will pass. It all depends which newspaper and what website you read.

PS: I am still going on holidays there next month and i am sure i wont find what it was described previously
i know all about greek demonstrations, i lived there most of my life!
however, it is always sad to see images like that or to learn that people have been seriously injured.

by the way, i go back at least 4 times / year and nowhere have i seen what was described above by another poster either!
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  #35  
Old 12.05.2011, 01:20
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Re: Greece discussing leaving the Euro Zone (Spiegel Online)

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The difference between Greece and (to my knowledge) most other countries is that the Greek lied for many years on key economic metrics that were part of the application to be allowed in in the first place.
I had laughing fits when Greece proved to the EU that they had reduced their inflation from, what, 15 - 20 % a year to less than 2 % a year, and that within one year. Easy. I mean, the lies were there for everyone to see. It's still an absolute mystery to me how anyone in Brussels could accept what they did.

The fact that they got away with those tricks (read: they became an honorable member of the Euro zone) made Greeks completely lose their sense of economical reality. For them, the EU was just the goose that laid golden eggs. "Let's take their money and forget about the rest." The results now keep the media happy and EU politicians busy.

Tourism will not be able to keep the economy alive. Greece was great at that when a Swiss family of four could go out for dinner with everything including wine for a total of CHF 20. That was 20 years ago. Now it's almost as expensive as Switzerland. For that kind of money you can get much better service elsewhere.
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  #36  
Old 12.05.2011, 01:26
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Re: Greece discussing leaving the Euro Zone (Spiegel Online)

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Tourism will not be able to keep the economy alive. Greece was great at that when a Swiss family of four could go out for dinner with everything including wine for a total of CHF 20. That was 20 years ago. Now it's almost as expensive as Switzerland. For that kind of money you can get much better service elsewhere.
Costs in the PIGS countries have gotten way to high. How to reduce them is another story.
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  #37  
Old 12.05.2011, 09:57
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Re: Greece discussing leaving the Euro Zone (Spiegel Online)

I am no financial expert, but would it really not be possible for Greece to leave the Euro and negotiate debt restructuring deals, like Argentina did 10 years ago? They had their currency linked to the dollar first, which led to hyperinflation. When they let go of the link, they had a bad year, but afterwards they seemed to have recovered now. Having your own currency gives you much more options to influence the economy in your own country. Now Greece is suffering for the euro-measures being taken not only for them, but also for Germany, NL, France, etc.
On top of that, for the euro it might be better too. I have the impression that nobody believes in the euro anymore, because countries like Greece and Portugal need to be supported at all cost it seems. Who is paying those costs?
If the Eurozone is reduced it should become much more stable. As a native of one of the "paying" euro members, I am quite worried about the finances of MY country, having to donate money and increasing our national debt. Someone will have to pay for it eventually, and I have a feeling it will be me...
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  #38  
Old 12.05.2011, 12:22
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Re: Greece discussing leaving the Euro Zone (Spiegel Online)

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I am no financial expert, but would it really not be possible for Greece to leave the Euro and negotiate debt restructuring deals, like Argentina did 10 years ago? They had their currency linked to the dollar first, which led to hyperinflation. When they let go of the link, they had a bad year, but afterwards they seemed to have recovered now. Having your own currency gives you much more options to influence the economy in your own country. Now Greece is suffering for the euro-measures being taken not only for them, but also for Germany, NL, France, etc.
On top of that, for the euro it might be better too. I have the impression that nobody believes in the euro anymore, because countries like Greece and Portugal need to be supported at all cost it seems. Who is paying those costs?
If the Eurozone is reduced it should become much more stable. As a native of one of the "paying" euro members, I am quite worried about the finances of MY country, having to donate money and increasing our national debt. Someone will have to pay for it eventually, and I have a feeling it will be me...

Using the euro as your country's currency is quite different from linking your currency to another currency.
If your major debts are in, for example, drachma then you could devalue the drachma & suddenly your debts are more manageable.
If your debts are in euro then even if you leave the eurozone you cannot devalue the euro to make your debts are more manageable.
You could say that you will only pay, for example, 50% of your debts but that would lead to a huge loss of confidence in the other PIGs when they try to sell euro denominated bonds.
There is also the question of what happens to the physical currency in circulation (notes & coins) - are the ones from Greece no longer valuable/acceptable?
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  #39  
Old 12.05.2011, 12:34
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Re: Greece discussing leaving the Euro Zone (Spiegel Online)

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Using the euro as your country's currency is quite different from linking your currency to another currency.
If your major debts are in, for example, drachma then you could devalue the drachma & suddenly your debts are more manageable.
If your debts are in euro then even if you leave the eurozone you cannot devalue the euro to make your debts are more manageable.
You could say that you will only pay, for example, 50% of your debts but that would lead to a huge loss of confidence in the other PIGs when they try to sell euro denominated bonds.
There is also the question of what happens to the physical currency in circulation (notes & coins) - are the ones from Greece no longer valuable/acceptable?
So is there any way out of this besides having the other countries all chipping in and paying Greece's debts?
It seems to me they will never be able to repay those debts on their own.
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Old 12.05.2011, 12:36
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Re: Greece discussing leaving the Euro Zone (Spiegel Online)

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So is there any way out of this besides having the other countries all chipping in and paying Greece's debts?
It seems to me they will never be able to repay those debts on their own.
Anybody who has a good answer to that question could command a huge reward from the eurozone
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