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Title: Greece: The Debtor that Roared
Source: Naked Capitalism
URL Source: http://www.nakedcapitalism.com/2011 ... ce-the-debtor-that-roared.html
Published: Nov 2, 2011
Author: Yves Smith
Post Date: 2011-11-02 09:46:53 by lucysmom
Keywords: None
Views: 3584
Comments: 8

Greek Prime Minister George Papandreou has managed to put the European crisis game of financial fakery into turmoil. Pretty much no informed commentator expected the latest gimmick-larded rescue package to work; there were simply too many points of failure. And even if this program had miraculously come to fruition, a later train wreck was still inevitable, since Germany was persisting in wanting two contradictory outcomes: running trade surpluses in Europe, and not lending more to its trade parters.

But no one anticipated that a long suffering debtor would revolt, which is what Papandreou’s announcement of a referendum on the punitive bailout amounts to. He’s publicly coded it in securing Greek support for the deal, but this is actually a clever form of brinksmanship. As Marshall Auerback and Rob Parenteau foresaw, Greece is engaging in a Samson-like gesture of pulling down a much bigger structure to end its misery.

snip

The goal of Papandreou’s move presumably is to renegotiate the terms of the deal imposed on Greece. To get the heretofore dictatorial Troika to take him seriously, he’s effectively threatened the nuclear option of blowing up the rescue package, which means default. And the disruption of a default suddenly changes the calculus of a Euro exit. The incremental short-term damage would not be that much worse, and the longer term benefit of regaining sovereignity, controlling its currency, and as a result, being able to depreciate the drachma would likely more than offset the costs. (Remember, the advantage of Greece staying in is to fund its budget deficit. But with the rescue packages so punitive that the Greek economy is shrinking faster than its debt levels are, the advantages of cooperation look to be illusory).

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#1. To: Not Badeye, A K A Stone, Fred Mertz, Godwinson, go65, war, no gnu taxes, Skip Intro, ferret mike, jwpegler, mininggold, brian s, mcgowanjm (#0)

But with the rescue packages so punitive that the Greek economy is shrinking faster than its debt levels are, the advantages of cooperation look to be illusory

If insanity is doing the same thing over again expecting a different result, then the IMF's (and US conservative) austerity prescription is insane.

"You post articles- intellectual excrement, really- that support your inane, insipid mentality, on a regular basis. Capitalist Eric

lucysmom  posted on  2011-11-02   10:03:25 ET  Reply   Trace   Private Reply  


#2. To: lucysmomBut no one anticipated that a long suffering debtor would revolt (#0) (Edited)

But no one anticipated that a long suffering debtor would revolt

US DIRTY FUCKIN HIPPIES DID

LMFAO 8D And you ain't seen shite. LT Armageddonwithit reporting for duty, sir!!! 8D

What gets me about Don CEO GUV Corzine is the absolute hubris combined with his absolute stupidity.

And if he's this stupid, it follows that Bernank, Diman, Blankfein, Bank of Ysrael are the same.

We tell them that 40 to 80 to 120:1 Leveraged ratios are mind boggling Stupid Crazy for the last 30plus years.

That a fraction of a % move against their positions will wipe them out.

And Us Dirty Fuckin Hippies are told to STFU. The Big Boys know what they're doing....

"Admiral Josh Painter: This business will get out of control. It will get out of control and we'll be lucky to live through it."-Red October

mcgowanjm  posted on  2011-11-02   10:10:43 ET  Reply   Trace   Private Reply  


#3. To: lucysmom (#1)

the Greek economy is shrinking faster than its debt

And this will continue world wide.

It's the Law of Receding Horizons.

Until only the FedREs with it's Unlimited Expanding Balance Sheet is left.

Or until a Critical Mass of folks who can no longer be excluded riots...

mcgowanjm  posted on  2011-11-02   10:15:02 ET  (1 image) Reply   Trace   Private Reply  


#4. To: mcgowanjm (#2)

But no one anticipated that a long suffering debtor would revolt

US DIRTY FUCKIN HIPPIES DID

You'd think the example provided by Argentina would've wised them up.

"You post articles- intellectual excrement, really- that support your inane, insipid mentality, on a regular basis. Capitalist Eric

lucysmom  posted on  2011-11-02   10:21:17 ET  Reply   Trace   Private Reply  


#5. To: lucysmom (#1)

If insanity is doing the same thing over again expecting a different result, then the IMF's (and US conservative) austerity prescription is insane.

They are trying to blame it on the fact that Greeks can retire earlier and at higher rates than most of us in the US. A bad, bad, bad, bad, thing according to 'experts'.

Yet the banks still extended them credit.

"ROTFLMAO... Perfect! She longs... for someone to Teabag her. a man that squats on top of a women's face and lowers his genitals into her mouth during sex, known as "teabagging" She aches for it"... ~~~JWpegler. Head Tea Bagger and Tea Party supporter extraordinaire, explicitly expressing his fantasies in public about other posters.

mininggold  posted on  2011-11-02   11:28:38 ET  Reply   Trace   Private Reply  


#6. To: mininggold (#5)

They are trying to blame it on the fact that Greeks can retire earlier and at higher rates than most of us in the US. A bad, bad, bad, bad, thing according to 'experts'.

Would those be the same experts that defend the lovely parting gifts bestowed on failed executives?

"You post articles- intellectual excrement, really- that support your inane, insipid mentality, on a regular basis. Capitalist Eric

lucysmom  posted on  2011-11-02   11:32:24 ET  Reply   Trace   Private Reply  


#7. To: lucysmom (#4)

You'd think the example provided by Argentina would've wised them up.

O they're wise to it alright.

You've just hit on the ipso facto ergo propter evidence....

The economic Hitman for details....;}

mcgowanjm  posted on  2011-11-02   11:33:56 ET  Reply   Trace   Private Reply  


#8. To: lucysmom (#6)

Would those be the same experts that defend the lovely parting gifts bestowed on failed executives?

I think those items just conveniently slip under their radar.

"ROTFLMAO... Perfect! She longs... for someone to Teabag her. a man that squats on top of a women's face and lowers his genitals into her mouth during sex, known as "teabagging" She aches for it"... ~~~JWpegler. Head Tea Bagger and Tea Party supporter extraordinaire, explicitly expressing his fantasies in public about other posters.

mininggold  posted on  2011-11-02   11:37:43 ET  Reply   Trace   Private Reply  


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