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So what happens to the EU when Greece doesn't get fixed?
Posted on 5/20/10 at 4:49 pm
Posted on 5/20/10 at 4:49 pm
What kind of hit would the US, EU, and Japan take if Greece was jettisoned from the Euro-zone?
2
Posted on 5/20/10 at 4:58 pm to NC_Tigah
Good question.
There is the fairly recent precedent of the dissolution of Yugoslavia and how all of the newly independent countries there had to develop their own currency after the Yugoslavian dinar went away. The first time I worked in Bosnia was less than 90 days after the Dayton Accord was signed which was before Bosnia had set up its own currency. They were using the German deutsch mark mostly and a little USD as their currency. It was awkward.
Of course, very few western banks were owed money by any Yugoslavian entity at that time.
There is the fairly recent precedent of the dissolution of Yugoslavia and how all of the newly independent countries there had to develop their own currency after the Yugoslavian dinar went away. The first time I worked in Bosnia was less than 90 days after the Dayton Accord was signed which was before Bosnia had set up its own currency. They were using the German deutsch mark mostly and a little USD as their currency. It was awkward.
Of course, very few western banks were owed money by any Yugoslavian entity at that time.
Posted on 5/20/10 at 5:00 pm to NC_Tigah
Need a better definition. Are we just talking about them getting kicked out? Or are we talking about them getting kicked out because of something (like, IDK, a default)?
Posted on 5/20/10 at 5:03 pm to kfizzle85
Assume both and answer the questions. I'd like to hear your opinion.
Posted on 5/20/10 at 5:11 pm to LSURussian
If they just get kicked out "just because," eg, they payback the loans but the EU govts say "no mas," I don't see how it would effect anyone outside of Greece and Albania/whoever their main trading partners are.
If they get kicked out because they default on the loans to the IMF/EU? I don't know what the economic effects would be globally, but not paying people back ~$180B is the type of shite that starts wars, and its not like EU is one big happy family. Its not like Argentina, they robbed their own citizens and didn't pay back a bunch of banks. Banks don't have militaries and banks don't have constituents to answer to. I don't know if it would actually start a war, but I would be pretty worried about the stability of the EU both politically and economically if that does eventually happen. If this eventually extends to Iberia, idk man, that's some serious, serious shite. Quantifying how much that spills over to the rest of the world is well beyond my capabilities.
If they get kicked out because they default on the loans to the IMF/EU? I don't know what the economic effects would be globally, but not paying people back ~$180B is the type of shite that starts wars, and its not like EU is one big happy family. Its not like Argentina, they robbed their own citizens and didn't pay back a bunch of banks. Banks don't have militaries and banks don't have constituents to answer to. I don't know if it would actually start a war, but I would be pretty worried about the stability of the EU both politically and economically if that does eventually happen. If this eventually extends to Iberia, idk man, that's some serious, serious shite. Quantifying how much that spills over to the rest of the world is well beyond my capabilities.
Posted on 5/20/10 at 5:17 pm to kfizzle85
quote:What would starting a war against Greece accomplish? Greece would just surrender and then Europe would have to take care of it again....just like now. Nothing changes. Of course, the rest of Europe could then get good discounts on tours of the Acropolis.....
I don't know if it would actually start a war,
quote:Russian banks do....but that's another topic.
Banks don't have militaries
Posted on 5/20/10 at 6:41 pm to kfizzle85
quote:Scenario I had in mind was need to address debt independent of the Euro. Greece would break out of the Euro-zone +/- the EU, return to the Drachma, allow/induce inflation/devaluation to assist with debt and gov obligations.
Need a better definition
Posted on 5/20/10 at 7:58 pm to LSURussian
quote:
What would starting a war against Greece accomplish?
When has rationality ever stopped a politician from starting a war?
Posted on 5/20/10 at 9:01 pm to kfizzle85
I went to Greece last summer. The whole time I wondered how the frick these Euros let this charity case into the EU (Apparently, they lied their asses off, SURPRISE!). They are lazy as shite, they siesta during fricking lunch time(lunch time being 4 hours long) so you can't get a decent lunch, they spray paint every thing (I think security is the only reason the Parthenon isn't spray painted) and they have people supporting the Communist Party. shite, half the monuments/anything remotely useful they have was built by Mussolini. My opinion of him rose sharply, impressive anyone could get those toads to build anything!
This post was edited on 5/20/10 at 9:02 pm
Posted on 5/20/10 at 10:52 pm to NC_Tigah
quote:
Scenario I had in mind was need to address debt independent of the Euro. Greece would break out of the Euro-zone +/- the EU, return to the Drachma, allow/induce inflation/devaluation to assist with debt and gov obligations
IDK, I had not considered that route to be honest, but since you posed the question, what is your feeling on that possibility and its outcomes? I have been operating under the idea that they will internally devaluate (basically cut budget deficits) at all costs, like Latvia but on a bigger level, until they eventually default.
Posted on 5/20/10 at 11:23 pm to LSURussian
quote:
Of course, the rest of Europe could then get good discounts on tours of the Acropolis.....
Who wants to go there if you might not leave?
Whatever course Greece takes you can bet Spain and Portugal are taking notes.
Posted on 5/20/10 at 11:45 pm to arrakis
And Latvia, and Lithuania, and Estonia, and Hungary...the list of EU countries running truly awful trade imbalances is long and colorful. They are, of course, all unique in their own particular predicament.
Posted on 5/20/10 at 11:56 pm to NC_Tigah
quote:
Scenario I had in mind was need to address debt independent of the Euro. Greece would break out of the Euro-zone +/- the EU, return to the Drachma, allow/induce inflation/devaluation to assist with debt and gov obligations.
There's no way for Greece to do this as I understand it.
You better believe if Greece exits the EU all of their Euro denominated debt will remain Euro denominated debt.
Posted on 5/30/10 at 9:27 pm to clamdip
quote:
The Sunday Times
Greece urged to give up euro
May 30, 2010
Robert Watts
THE Greek government has been advised by British economists to leave the euro and default on its €300 billion (£255 billion) debt to save its economy.
The Centre for Economics and Business Research (CEBR), a London-based consultancy, has warned Greek ministers they will be unable to escape their debt trap without devaluing their own currency to boost exports. The only way this can happen is if Greece returns to its own currency . . .
“So part of the package of leaving the euro must be to convert the debt into the new domestic currency unilaterally.”
Greece’s departure from the euro would prove disastrous for German and French banks, to which it owes billions of euros.
Posted on 5/30/10 at 9:34 pm to NC_Tigah
Saw that. Just shows you how dire the situation is to begin wtih.
Posted on 5/30/10 at 10:15 pm to kfizzle85
I'm hoping they get paid in ouzo.
Posted on 5/30/10 at 10:20 pm to tigerpurple84
Not gonna lie I would accept pmt in ouzo.
Posted on 5/31/10 at 1:09 am to kfizzle85
Maybe one day, we can be an advanced society like western Europe.
Posted on 5/31/10 at 8:28 pm to NC_Tigah
quote:
Scenario I had in mind was need to address debt independent of the Euro. Greece would break out of the Euro-zone +/- the EU, return to the Drachma, allow/induce inflation/devaluation to assist with debt and gov obligations.
I think this is the most likely scenario for one that'd lead to Greece being out of the EU. It'd be Greece initiated.
No way I see the EU countries, namely France, Belgium, Germany, *kicking* Greece out. That is a kiss goodbye of all those Greek loans.
btw, how retarded is it that there was never a roadmap laid out by the EU architects to determine criteria for expulsion from the EU? It is laughable that they were so arrogant as to think it would not even need to be planned for.
Posted on 5/31/10 at 8:57 pm to clamdip
quote:
how retarded is it that there was never a roadmap laid out by the EU architects to determine criteria for expulsion from the EU?
Not the same, but our founding fathers did not think of this either.
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