Some articles about the European debt crisis

[Cobol74]

If you break the rules then that is a green light for everyone else. I will not even mention the lack of help to Ukania to stay in the snake when we asked so we could not join the Euro - ha ha ha I bet you regret that too, we do not have to put our hands in our pockets - except that we have.

By the way when is a veto not a veto when David Cameron has one.

 

[MacGuffin]

If you break the rules then that is a green light for everyone else.

Yes.

And if you ask the politicians involved today, they will admit that that was one of their biggest mistakes back then. You shouldn't forget, though, that in the case of France or Germany that rule-breaking wasn't too bad. It was a bad example, yes, a green light for others with a less solid economy but in the end it didn't do any actual damage.

But the fact, that the markets and the rating agencies are now kicking the politicians arses, is new. They function as a kind of economical police and I think that's good (not a popular view, I know), because it forces the politicians into action and shows them, that future economical stunts will not go unpunished.

By the way when is a veto not a veto when David Cameron has one.

Yes, but old news. Was said and written here the very next morning, too.

P.S.: You have quite a bunch of unappealing, grouchy commentators there, btw.

 

[argatoga]

MacGuffin let me state my question again. If the EU cannot pay for Spain, Portugal, Italy, and Spain, it will collapse. How would it prevent this? I don't want your bromides. If the EU can't answer this question this year it won't exist.

And no I don't believe only Americans live in reality and require facts and logic. And yes we have politicians who go out of their way to give nebulous answers that avoid the real issues here too.

EDIT:

As an analogy: a person is chocking to death and you are saying how great his future is instead of helping him.

Seriously, if I were you, I would be much more concerned about the future of my own country

America has a shit load of natural resources. We can build our way out of a lot of problems.

 

[MacGuffin]

MacGuffin let me state my question again. If the EU cannot pay for Spain, Portugal, Italy, and Spain, it will collapse. How would it prevent this?

As an analogy: a person is chocking to death and you are saying how great his future is instead of helping him.

No one is choking to death. Where did you get that idea from? And the issue is already being dealt with. Portugal, Italy and Spain are still better off with debts, than the USA. If they are unable to help themselves, they will get the help of course. Taking care of that has been the major activity in Europe recently. Only the bottomless pit called Greece is currently in real danger of going under, not the EU. Therefore your question has no real relevance. It's like saying "So, what do you do, when the meteor hits the Earth this year?" It won't happen. There is no meteor. But you keep asking "But what if there were one?" Makes no sense.

America has a shit load of natural resources. We can build our way out of a lot of problems.

So are you suggesting for the USA to go back into isolationism again and work off their debts?

 

[argatoga]

No one is choking to death. Where did you get that idea from? And the issue is already being dealt with. Portugal, Italy and Spain are still better off with debts, than the USA. If they are unable to help themselves, they will get the help of course. Taking care of that has been the major activity in Europe recently. Only the bottomless pit called Greece is currently in real danger of going under, not the EU. Therefore your question has no real relevance. It's like saying "So, what do you do, when the meteor hits the Earth this year?" It won't happen. There is no meteor. But you keep asking "But what if there were one?" Makes no sense.

(Reuters) - Portugal's economy will shrink as much as Greece's this year, according to IMF projections. The two will have identical current account deficits and the red ink in Portugal's budget will be almost as deep as in Greece's.

(Reuters) - Rating agency Standard & Poor's downgraded 34 Italian banks on Friday, including heavyweights UniCredit (CRDI.MI) and Intesa Sanpaolo (ISP.MI), citing a reduced ability to roll over their wholesale debt and expected weak profitability.

Spain back on brink of recession as economic shrinkage worsens

Things looking bright there . So where does all this money come from that is being thrown at these nations? Unless this money stream is unlimited things will come to an end, and not a good one.

So are you suggesting for the USA to go back into isolationism again and work off their debts?

The U.S. can build up a manufacturing base given time without a lot of foreign debt. It can't happen overnight, but the U.S. doesn't need to rely on others for most of its needs. Opposed to say Germany who is at the mercy of others to fuel its industry.

 

[The Spie]

So are you suggesting for the USA to go back into isolationism again and work off their debts?

That's Ron Paul's solution, not argatoga's. What he's talking about is that we still have the manufacturing capability lying dormant that can be reactivated. Combine that with natural resources that we don't have to import, and we can get back to making things rather than continue being a service-dominated economy. Most of the countries in Europe are tapped out or don't have those resources anymore (or ever did, viz. Germany and oil). It would be a radical solution, and the economies of scale would probably make it inefficient compared to, say, China, but it would be a solution. Greece and Portugal can't really do that.

 

[MacGuffin]

Things looking bright there . So where does all this money come from that is being thrown at these nations? Unless this money stream is unlimited things will come to an end, and not a good one.

You shouldn't be so selective on what news you read. Maybe you should read up a bit on the structure of the EU and what is currently going on here. Start with this:

http://en.wikipedia.org/wiki/European_Stability_Mechanism

The U.S. can build up a manufacturing base given time without a lot of foreign debt. It can't happen overnight, but the U.S. doesn't need to rely on others for most of its needs. Opposed to say Germany who is at the mercy of others to fuel its industry.

I see some fundamental differences in the points of view here.

You see, we make friends and trade partners. We do not alienate ourselves from them and the rest of the world We do not fear the ones we trade with, we treat them with respect and don't become paranoid. Life is a give and take and so are the relationships between countries. The countries we trade with, have as much interest in dealing with us, as we have in dealing with them. Any kind of aggressive act would hurt both sides. That is called "balance of trade". Ours is even, how about yours?

Oh, I forgot, you trade by making debts for buying foreign goods. Well, talking about becoming someone's slave We might have our faults but we do not bury ourselves in foreign debt, so we can uphold our bloated standard of living. That you have in common with Greece, btw.: The people in both Greece and the USA are wealthier than they actually deserve, based on the real economical power

We might need to import resources, yes, but at least we're not the Chinese's and Japanese's lapdog, when it comes to financing our lifestyle

That's Ron Paul's solution, not argatoga's. What he's talking about is that we still have the manufacturing capability lying dormant that can be reactivated. Combine that with natural resources that we don't have to import, and we can get back to making things rather than continue being a service-dominated economy.

So when do you start? Aren't your politicians currently busy with defending their own interests and following their ideologies, rather than actually doing something good for the country?

And you probably realize, that following your suggestion means, that you will have to become a poorer society again first? So who's going to tell the people?

Most of the countries in Europe are tapped out or don't have those resources anymore (or ever did, viz. Germany and oil). It would be a radical solution, and the economies of scale would probably make it inefficient compared to, say, China, but it would be a solution. Greece and Portugal can't really do that.

I agree, that we have to find another solution for the "problem countries", than simply giving them money. But for that they have to become reliable first. The trouble they're in, is not a natural law or a geographical disadvantage or something like that.

Greece is not doomed to stay poor forever. What they need, is to gain back trust. Trust in their politics, trust in their ability to be reliable partners. There have to be lots of internal reforms to create good conditions for foreign investors.

When that happens, investors will come. I mean, come on: The weather is fine, the landscape nice and you have the Mediterranean at your doorstep People woul rather make their money in Greece or Italy, than Germany. It's only a matter of giving the right incentives.

And that is the direction the reasonable European leaders want to go. But it will take time. You cannot undo the errors of decades in a few years. Let's talk again in, say, 2020.

 

[argatoga]

You shouldn't be so selective on what news you read. Maybe you should read up a bit on the structure of the EU and what is currently going on here. Start with this:

http://en.wikipedia.org/wiki/European_Stability_Mechanism

You aren't refuting the fact that these countries are suffering severe economic issues. I ask again, where does the money come from that is being thrown at these nations as a "fix"? Stop with the red hearings and straw men and answer the question.

I see some fundamental differences in the points of view here.

You see, we make friends and trade partners. We do not alienate ourselves from them and the rest of the world We do not fear the ones we trade with, we treat them with respect and don't become paranoid. Life is a give and take and so are the relationships between countries. The countries we trade with, have as much interest in dealing with us, as we have in dealing with them. Any kind of aggressive act would hurt both sides. That is called "balance of trade". Ours is even, how about yours?

Oh, I forgot, you trade by making debts for buying foreign goods. Well, talking about becoming someone's slave We might have our faults but we do not bury ourselves in foreign debt, so we can uphold our bloated standard of living. That you have in common with Greece, btw.: The people in both Greece and the USA are wealthier than they actually deserve, based on the real economical power

We might need to import resources, yes, but at least we're not the Chinese's lapdog, when it comes to financing our lifestyle



So when do you start?



I agree, that we have to find another solution for the "problem countries". But for that they have to become reliable first. The trouble they're in, is not a natural law or something or a geographical disadvantage.

Greece is not doomed to stay poor forever. What they need, is to gain back trust. Trust in their politics, trust in their ability to be reliable partners. There have to be lots of internal reforms to create good conditions for foreign investors.

When that happaned, investors will come. I mean, come on: The weather is fine, the landscape nice and you have the Mediterranean at your doorstep It's only a matter of giving the right incentives.

There is less bureaucracy, trade tax, and transport costs when you have all the resources you need. When another nation won't trade a needed resources it helps to have it yourself as well.

 

[MacGuffin]

You aren't refuting the fact that these countries are suffering severe economic issues. I ask again, where does the money come from that is being thrown at these nations as a "fix"? Stop with the red hearings and straw men and answer the question.

As of now, it is only a debt guarantee. With a bit of luck, no big amounts of money will ever flow.

If, however, things turn really bad, it would have to be paid by the member countries, which ultimately means the taxpayers.

Is that the answer you wanted to have? Because I consider it general knowledge.

 

[argatoga]

As of now, it is only a debt guarantee. With a bit of luck, no big amounts of money will ever flow.

If, however, things turn really bad, it would have to be paid by the member countries, which ultimately means the taxpayers.

Is that the answer you wanted to have? Because I consider it general knowledge.

Let me break it down.

1) We are in a worldwide economic downturn which shows no signs of changing anytime soon.
2) Spain, Italy, Greece, and Portugal are unable to pay their debts.
3) The E.U.'s policy is to throw money at these countries hoping that will fix their debt.
4) This money comes from the wealthier nations like Germany, who still have money even though they too are suffering from the worldwide downturn.
5) The wealthier nations do not have enough money to bail out Portugal, Italy, Spain and Greece.
Thus the E.U. will collapse under the debt if the wealthier nations keep throwing money at them.

 

[MacGuffin]

Let me break it down.

1) We are in a worldwide economic downturn which shows no signs of changing anytime soon. We're doing fine and it also will go up again for others.
2) Spain, Italy, Greece, and Portugal are unable to pay their debts. Greece yes, the rest has to be seen.
3) The E.U.'s policy is to throw money at these countries hoping that will fix their debt. No money has been thrown yet and as I said, maybe there never will.
4) This money comes from the wealthier nations like Germany, who still have money even though they too are suffering from the worldwide downturn. We're not suffering at all.
5) The wealthier nations do not have enough money to bail out Portugal, Italy, Spain and Greece. The worst case scenario is only theoretical and won't happen, if the political leaders do their homework now.
Thus the E.U. will collapse under the debt if the wealthier nations keep throwing money at them. No, it won't.

You seem to be the "glass half empty" type of guy.

In the end this all is about helping people in need, which I, by the way, consider a quality of a civilized society. The question is how to help them best. Money is a quick fix but on the long run, something more sustainable has to come.

And it is possible. We Germans are the living proof. Where would Germany be today without the Marshall Plan? We know, what can be done with the help of others and it's because of that part of our history, that we are still feeling generous today (despite others not feeling the same way).

Let's resume this discussion in a year or two. The speculation will be over then. What do you think?

 

[argatoga]

You seem to be the "glass half empty" type of guy.

Let's resume this discussion in a year or two, what do you thnk? The speculation will be over then. What do you think?

I provided evidence, I'd like you to do the same.

 

[MacGuffin]

No, you only provided pessimism.

And I have the strange feeling, that you actually want to see the EU going ballistic, because in your mind it would be better for your own country, if it didn't exist as one entity anymore. But I'm theorizing now

If you are really interested in facts, read up on the Wikipedia entry I posted above and also go for the cross references.

 

[argatoga]

No, you only provided pessimism.

If you are really interested in facts, read up on the Wikipedia entry I posted above and also go for the cross references.

So how was Reuters wrong? And what magic source of funds is the ECM taping? As the policy to throw money around is still being enacted.

 

[MacGuffin]

Opposed to what? The policy of printing more money?

Seriously, though: Are you reading what I write at all?

 

[argatoga]

Opposed to what? The policy of printing more money?

That doesn't disprove my proof I posted earlier.

 

[MacGuffin]

They facts you bring are probably right (even if you use them selectively) but the conclusions you draw from them, are simply wrong.

That's all I have to say for now.

 

[argatoga]

They facts you bring are probably right (even if you use them selectively) but the conclusions you draw from them, are simply wrong.

That's all I have to say for now.

I'll await your rebuttal where you explain this.

 

[MacGuffin]

I already did that but since you don't read, what I write...

Sorry for appealing to common sense too much.

 

[argatoga]

I already did that but since you don't read, what I write...

Sorry for appealing to common sense too much.

Please requote yourself and your common sense then since I appear to have missed it.