"Rather Cut Off My Arm Than Pay Back What Greece Borrowed".... Varoufukis

AAAintheBeltway said:
How is it fair to creditors who lent money to PR on the understanding that it could not declare bankruptcy? Isn't that changing the rules in the fourth quarter?
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Of course not. Risk premium of bonds takes into account (or should if calculated correctly) the possibility of default regardless of laws. They were compensated for risk, based on credit rating. If they did so with the understanding that PR was locked into paying them legally, then that's their problem.

As for changing the rules in the 4th quarter, please show me the prospectus that states the government can bail out financial institutions with tax payer dollars. (like we've never done that!)

Or how about the one that says the Fed can issue QE whenever stocks fall. I'll bet the short sellers would love to see where those laws are that they overlooked. We can change the rules in the 4th quarter when it suits the creditors and banks - why can't we do it when it serves the people?
 
There is a big difference in a policy move, eg QE, and actually changing laws.

Actually I'm not sure it would be constitutional, under the Impairment Clause, for congress to alter the law in a way that prejudiced creditors. Of course, in the age of obama and this Supreme Court, the Constitution is viewed as more of a speed bump than an obstacle.
 
Tsing Tao said:
I rarely pay attention to the regular press. In this case, the main cheerleading financial press (like CNBC) are pissed because markets are down. They blame Merkel (which is lunacy). But no one ever accused those guys of understanding anything in economics or the market.
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To illustrate that point, one of the rube's opined that an upcoming report on I-phone sales could hold to key to stemming the stock market collapse in China...the guest laughed (assuming this guy was making a joke)...of course he wasn't...

I haven't watched the network in about 5-6 years, but the same idiots (and a few new ones) are still there.
 
AAAintheBeltway said:
There is a big difference in a policy move, eg QE, and actually changing laws.

Actually I'm not sure it would be constitutional, under the Impairment Clause, for congress to alter the law in a way that prejudiced creditors. Of course, in the age of obama and this Supreme Court, the Constitution is viewed as more of a speed bump than an obstacle.
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There's absolutely no difference between Fed actions (which in many cases during the crisis were outside of laws) and allowing PR to go bankrupt. It's just that one saves the creditors and banks, and the other the people. Given that differential, I'd argue that laws should exist to protect people more than they do the financial sector.
 
Tsing Tao said:
There's absolutely no difference between Fed actions (which in many cases during the crisis were outside of laws) and allowing PR to go bankrupt. It's just that one saves the creditors and banks, and the other the people. Given that differential, I'd argue that laws should exist to protect people more than they do the financial sector.
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I vividly remember that day in the fall of 2008 when popular support for the bailout measure was 90/10 against...and now after 7 years of ZIRP, it's hard to believe (and remember) when one could actually get a 5% yield in treasuries (which was still really low compared with much of the 70's-80's)...
 
der_kommissar said:
I vividly remember that day in the fall of 2008 when popular support for the bailout measure was 90/10 against...and now after 7 years of ZIRP, it's hard to believe (and remember) when one could actually get a 5% yield in treasuries (which was still really low compared with much of the 70's-80's)...
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I remember my parents having a 18% mortgage in the late 70s!
 
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