Ken Rogoff on Greece
- Thread starter Daal
- Start date
The problem with Greece isnt the debtload or their financial household or anything like that although they are in bad shape obviously.
The real problem is it's populace which is far less obedient than their peers in Western Europe or the US.
The view of (Central) bankers as the prime root of the situation they find themselves in as a country today is widespread in Greece and needs only a small spark to really set things on fire.
This and the contagious effect it might have is what's really spooking the markets imo.
Myself I am fine with both outcomes.
Either the people burn Athens down to the ground showing the world the banking elite is human afterall or they accept their new austerity and embrace it.
Whatever works.
The real problem is it's populace which is far less obedient than their peers in Western Europe or the US.
The view of (Central) bankers as the prime root of the situation they find themselves in as a country today is widespread in Greece and needs only a small spark to really set things on fire.
This and the contagious effect it might have is what's really spooking the markets imo.
Myself I am fine with both outcomes.
Either the people burn Athens down to the ground showing the world the banking elite is human afterall or they accept their new austerity and embrace it.
Whatever works.
Greek budget deficit: 8.7%
US budget deficit: 10.2%
If it shrinks from inquiry, it ain't truth.
US budget deficit: 10.2%
If it shrinks from inquiry, it ain't truth.
New drachmas will start floating around before this crisis is over. Don't economists of member countries of currency unions model what happens in the event budget deficits happens, *before they join*?
Without central fiscal backing, there is absolutely no reason to give up monetary sovereignty. And it looks like there is no mechanism for central fiscal backing here. What a joke the EU is.
Disagree...
One reason would be to lower borrowing costs during normal mkt conditions (which, I guess, is a form of fiscal backing). Greece certainly got that benefit, but squandered it all away, in contrast to, say, Italy. Arguably, if there was a way, they should be forced to stay in the union and only be allowed to re-denominate once they have settled their accounts.