29 Comments

  • Hi Yanis, as ever I am obliged. Can you please provide us also with a comment on the apparantly new request to formalize the patron – slave relationship with some commissioner from the EU put in charge of prioritising Greek government revenue spending and vetoeing Greek decision making to match the preferences of our creditors? I am infuriated at this and for the first time certain that I would rather Greece leave the Euro and for this to come to pass. Do you think my view is just hot air and without substance since already the EU is pulling our strings or do you think there is good reason to draw a red line somewhere, if not somewhere then here? Thanks

    • I don’t think the non-paper you are referring to holds any real weight. It’s the Troika talks throughout these two years that are worrying me. Red lines should be part of any negotiations and it’s a wonder that they appear to be completely absent so far.
      It’s not a good idea to leave the euro and it’s definitely a worse one to leave the EU, but, if the demands of the Troika are what they are reported to be, even I say: sod it! All we seem to be doing is delaying the inevitable (default) while collecting more and more debt. Sadly, though, I am inclined towards the view that the outcome of the negotiations is and has always been our politicians’ and not the Troikans’ fault. Either way, there now appears to be no other solution.

  • Good presentation but yannis worlwide recycling of surplus? Even if the world leaders (japan, germany,china, canada, korea) and some other worldwide surplus countries decide that the surpluses did not reach to the inhabitants of debt countries. And why that? Corruption.. See inside the USA which has a recycling mechanism of surpluses. Some states are still poor with exciting unemployment, very poor social benefits etc. Massive Corruption in senators, governors and to state leaders. So the system is there but they are there too. Its time not to think …Its time to do…
    As the song says : Enigma ~Return to Innocence~ DAVOS PLEASE HEAR:
    http://www.youtube.com/watch?v=Rk_sAHh9s08

  • “The austerity policies the Germans favor are hopelessly biased in favor of German banking interests and are aimed more at the preservation of the reputations of German politicians than at helping Greece.

    The German political establishment seems willing to destroy Europe to avoid telling German voters the truth about how stupid it has been. Germany’s leaders are doing everything possible to conceal the ugly truth that the mistakes that the German banking and regulatory establishments made in underwriting Club Med debts are as much a cause of Europe’s woes as spendthrift Greeks.

    German bankers (along with their colleagues in many European countries) jumped feet first into the Greek debt morass. They are also up to their eyeballs in Spanish, Portuguese and Italian bonds. It was not simply their inability to make good lending decisions that landed them in this pickle; the German government encouraged banks to load up on Club Med debt even as those countries grew steadily less creditworthy after 2008. Banks were told that the sovereign debt of eurozone members could be carried on their books risk free, in effect making those bonds significantly more attractive than other securities priced at a comparable level.

    Much of German (and French) policy in the crisis pretends to be about saving Europe but is really about saving their own banking systems, if at all possible without drawing the attention of voters and taxpayers to the official idiots who helped make this all happen. By denouncing the profligate PIIGS, and demanding punitive austerity drives in debtor countries, German politicians are demagogically whipping up their own public opinion while covering up their own grievous and expensive misjudgments. It takes two to make a bad loan and German authorities richly deserve to be pilloried by their own population for their clueless financial leadership in the euro era. It is deeply irresponsible as well as cowardly for them to dress in the robes of righteousness and beat the Greeks.

    German politicians from Chancellor Merkel down love to talk about their dedication to Europe and their desire to see the current crisis resolved through the strengthening of European institutions. If this is sincerely their belief and not a shallow pose, they can begin by taking public responsibility for their own very considerable part in creating the European crisis, explain to German voters that Germans are going to have to pony up to save their banking system from the consequences of bad regulation and stupid loans, and come up with a much more just and reasonable approach to the European crisis than anything they have yet proposed. That solution will certainly include many of the reforms Germany advocates today, but it will also include measures that share the sacrifices far more equally and fairly than anything the Germans have yet been willing to conceive.

    If Germany’s leaders don’t do this, they stand exposed as spineless opportunists who are genuinely ready to wreck Europe to preserve their miserable political careers. This is Kaiser Wilhelm class political irresponsibility and incompetence, if not quite up to later German accomplishments.

    Without years of stupidity on the part of Germany’s banks and politicians, Europe would not be in this fix today. Their cowardly and irresponsible failure to take their fair share of responsibility for this mess is at the heart of the inability of Europe to overcome its crisis today. Germany must come clean for Europe to thrive.”

    Isn’t it the truth!

    • Blaming Germany is so much easier than reforming your own country, isn’t it? Nobody FORCED Greece to take up so much debt. Nobody FORCED Greece to overspend on the Olympics. Nobody FORCED Greece to not collect taxes properly.

    • Blaming the ‘foreigners’ is, as you say, too easy and highly unproductive. But, I am afraid, this applies to the Germans just as it applies to the Greeks. We Greeks are surely responsible for our tax evasion, our bureaucracy, our grand failure at focusing on our comparative advantages. But, Greece is now caught up in a debt-deflationary spiral from which no reforms can help it escape. In the interests of a civilised dialogue, I shall not state what I think Germany’s failures are in creating this spiral. Would you care to tell us what you think Germany’s contribution to this mess was/is?

    • Blaming Germany is so much easier, when Germany makes it so much easier for you to blame it.
      With its stubborn refusal to face economic reality, its inability to comprehend the monstrous particularities of the Greek system and its nationalistic hysterical hiccups, German political stance: a) plays right into the hands of those Greeks who simply refuse to self-criticize and b) manages to irritate and insult even the most self-depreciating of Greeks.
      It is important that the German get a grip. Now. The political and historical (not fiscal) stakes are too high. All they are doing right now is confirming the age-old “stubborn and imperialistic” stereotype of them. Tyxaio? (coincidence?) I certainly hope so……

    • That are great news Dean! The first thing i will do tomorrow is a visit at my local bank and get a loan. After some time the bank ask: “Where is my money?” My answer is: “It’s gone guys. But it isn’t my fault – it’s yours, you gave me the money.”

    • Noone forces Greece to leave the Euro. If they consider the options it would be a smart thing to do. The Euro will dissolve anyways with or without Greece, so what?

      I do not know of any default with successful recovery without devaluation. Drachme here I come!

    • @Marcus: It works differently: You borrow money. After some time the bank ask: “Where is my money?” My answer is: “It’s gone guys. But it isn’t my fault – it’s yours, you gave me the money…

      … AND then you threaten a third party : If you do not pay for my loan, I will rob your checking account via Target2. Remember you gave me full access when you let me join this currency union.

    • Germany’s contribution to the mess was to provide what Greece asked for: loans, bridges, airports, tanks. A bit like the drug dealer who provides the drugs, except that Greece is not a 16-year old junkie and that none of this was illegal.

    • None? Not even the bribes that Siemens was pushing for decades into the pockets of our politicians in exchange of ludicrously expensive (for the Greek state) contracts? (A piece of advice: Before denying this, check the facts. They come not from some Greek source but from the German legal system.)

    • “Not even the bribes that Siemens was pushing for decades into the pockets of our politicians in exchange of ludicrously expensive…”

      Absolutely illigal, but a look the corrution index would help to identify that corruption is less common in Siemens corporate culture than Greek everyday life. Most European countries rank 1-20, Greece ranks #80 between Peru and Colombia.

      http://www.guardian.co.uk/news/datablog/2011/dec/01/corruption-index-2011-transparency-international

      Why do you guys only talk about the Siemens case? Who talks about corrupt Greek companies? Noone, because it is normal? Remember Proton bank stealing EUR 900 million of our bailout money?

    • Where did you get the notion that “no one” speaks of corruption among Greek companies here in Greece? Some of us have been doing nothing else for decades. And suffered the consequences for it while our politicians were dealing and wheeling with their German and French banker mates. [As for the reasons why we keep talking about Siemens here in Greece, the reason is simple: Because whichever stone you unturn in this place you will find another Siemens bribe. That’s why.]

    • “Germany’s contribution to the mess was to provide what Greece asked for: loans, bridges, airports, tanks. A bit like the drug dealer who provides the drugs, except that Greece is not a 16-year old junkie and that none of this was illegal”

      So? Germany is a drug dealer that sells to an adult junkie. Is this legal in your country?

      Look mate, we, the Greeks, will settle our issues sooner or later, one way or another. You got to know two things though.
      1. If our people are about to starve, your “loans” are history.
      2. None of these “greek” trouble would go on for long IF YOU HAVE PAYED BACK THE WAR REPERATIONS FOR THE 450.000 DEAD.
      ———————————————–
      Sorry yanis. I hate this and won’t comment on such issues again.

  • What one needs to understand about Canada, in order to put everything into proper perspective, is that it is, and always has been, a colony. Hence, the “queer logic of ‘expansionary-austerity’” in effect to date, and it’s absolute “dependance on the haphazard demand for primary commodities”, driven by majority foreign ownership.

    “Canada cannot rely on lax monetary policy” because it does not control its monetary policy given it’s position as a “demand” export economy primarily to the U.S. (hence perpetually low exchange rates) and China.

    As demand dries up in the absence of a “global recycling system”, Canada, and especially its treasured welfare apparatus (also at risk because of real negative population growth), is in a seriously precarious position. …one its disproportionately over-indebted population does not recognize. This is the reason for Stephen Harper’s recent foreboding comments at the 1:45m mark of this posts video.

    Canada is a text-book case of “Eyes Wide Shut” for sure…. a false sense of security if there ever was one.

  • [Yanis in reply to Andreas Moser]: None? Not even the bribes that Siemens was pushing for decades into the pockets of our politicians in exchange of ludicrously expensive (for the Greek state) contracts?

    Not “bribes,” Yani, “campaign donations.” 😉

    • So hold the Greek politicians accountable why focus on Siemens….and why they so easily managed to buy the Greek politicians…! For a change why doesnt someone begin with holding the Greek leadership at all levels accountable for “accepting” as opposed to focusing on the many companies that will do whatever it takes to secure business. Is the example of Siemens supposed to be new or extraordinary ? This is done every day all over the world its just that the Greeks have a sweet tooth for “donations”…. Shameful !!

    • Racism begins with “Greeks this” and “Germans that”. Unless you have evidence that all Greeks are “like this” and all Germans are “like that”, please refrain from generalisations. They are the first step into the trap racism has set up for us.

    • Racism begins with “Greeks this” and “Germans that”. Unless you have evidence that all Greeks are “like this” and all Germans are “like that”, please refrain from generalisations. They are the first step into the trap racism has set up for us.

      Obviously, Yani, not all Greeks are “like this.” Speaking for myself, I admit that I have fallen into “the trap” of making generalisations regarding Greece. Racism? Of course not. It’s because I care. A lot. If I didn’t care, I’d be silent about the dire situation in Greece, uncritical, and saying silly things such as Greeks “know[ing] how to play Game Theory with multiple players.” 😉 Considering that I was neither born nor raised in Greece, you might be wondering why I care so much about her. I guess it probably has to do with growing up in a Greek home (and neighbourhood), learning Greek as the first language, completing 7 years of Greek school, and spending many summers in Greece … and knowing that if we were ever unwelcomed in Canada, there was always Greece to accept us! Yeah, that will do it 🙂 (Btw, don’t get me wrong, I care both for Canada and Greece — equally.)

      Now to get back to the “generalisations,” … It’s very hard to refrain from them. For example, have you ever been to the central KTEL bus station in Kifisos (Athens)? I am asking this sincerely, Yani. You won’t believe the things I and my family witnessed there a couple of years ago, all in an hour’s wait for the bus to take us to Sparta. (We usually take the cab to go Sparta from Athens, but the cabbies that year were demanding 350 euros, on average, for the trip. Fat chance.) Inside the station — remember, this is just one of several crazy episodes inside the station! — not 50 meters from where we were standing and exactly opposite to us, there was a makeshift shelter (if I can call it that as it was nothing more than a few large cardboard boxes and dirty blankets). It was a family of four making their home in the filthy bus station. Sad. Very sad. But it gets worse. While their kids were sleeping in one of the cardboard boxes, they did not appear to be more than 7 or 8 years old, the parents started shooting up. Penn Station, New York? No. Central bus station, Athens! As for the police? What police? No police. And . . . the Greeks? They did not care nor notice. There is a lot of not caring and not noticing in Greece, Yani (sorry — another dreaded “generalisaiton”).

      As for Siemens, what is both disgusting and scary (indeed!) is that the recipient of the (alleged) bribes was the Minister of Defense. Thanks to him, the nation of Hellas was put at risk. Who did Siemens put at risk other than its shareholders and management? Then again, who cares? Siemens is not responsible for the defense of Hellas.

  • If Dean would work on fixing his own problems more and stop blaming others for his problems, his problems might be fewer some day….