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Obsidian

What Happens if Greece Defaults?

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sneaking an It's Not Just Another Release post in over here ;)

... it would fit in The Whole World is Next thread too...

 

In a sane system, when the collateral vanishes, so too does the debt (writedowns, write-offs, bankruptcy, take your pick). In an insane system, … phantom collateral supports ever greater mountains of debt.

 

How long do you reckon the insane system we have now will last? The collateral is phantom, but the interest payments are very, very real.

 

charles hugh smith-Where's the Collateral?

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Well, if Greece leave the EU, then Spain, Portugal, Ireland or even Italy will follow, and the EU eventually is going to fall like a house of cards.

 

I think EU authorities don't want to force Greece to quit since it would cost them a lot.

 

BTW, here is another great article stating that Spain should leave EU before the Greece.

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as the things are getting worse, time to change the question...will Greece leave the eurozone willingly or will be kicked out? :roll eyes:

 

the next question is what will happen when the EZ collapse? :roll eyes:

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look at the big picture...

 

Greece represents 2.3% of EU's economy.

 

IF Greece disappears from the face of the Earth,

 

nobody would notice.

 

 

All these market volatilities are just another way to extract money from the weak.

Edited by Tams

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look at the big picture...

 

Greece represents 2.3% of EU's economy.

IF Greece disappears from the face of the Earth,

nobody would notice.

All these market volatilities are just another way to extract money from the weak.

 

"look at the big picture..."

 

Unfortunately Tams, The Fractional Reserve Banking System levers Greece's debt ( both public and private) into a very large number indeed.

 

And to add to the woes, Europeans have permitted their Banking System to lever out to 26:1 ... twice the level that conventional wisdom dictates.

 

This is a political problem that will only accept a political solution to the angst of Nationalism versus Federalism

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I agree that nobody cares about what will happen to Greece...but some see this as a prestige matter. if eu fails to save such a small economy, then what will they do when the crisis hits the bigger ones?

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.

 

When was the last time you bought something that's made in Greece?

 

... and what did you buy?

 

 

 

I think I bought a little bottle of olive 20 yrs ago.

 

 

.

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.

 

When was the last time you bought something that's made in Greece?

 

... and what did you buy?

 

 

 

I think I bought a little bottle of olive 20 yrs ago.

 

 

.

 

OUZO ! about 10 years ago.

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simply...nothing...

 

do they produce anything?

I do not think they are exporting olive :roll eyes:

10 years ago I would buy Spanish olive...still the same...

 

Some weeks ago I had read an article saying Greek products has to be 30% cheaper in order to be on a par with Turkey...that is a huge number...

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Maybe they should do like Zimbabwe when their currency blew up.

 

They now use: U S Dollar, Euro, Pound, South African Rand and the ultra stable currency of choice Botswana Pula ;)

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It's a beautiful place to vacation ... the only Greek product I know of is the Greek Yogurt my wife eats ... but I'm not even sure its made there.

 

They need to start paying their taxes ... the average 'stated income' of doctors is $30,000! Pathetic.

 

MMS

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it is ironic that just a couple of days before the Spain called for help, Draghi was saying that the market should be confident about the eurozone...

maybe I am blind and can't see but I think many EU governments are inefficient and ineffective...

In addition, austerity measures alone will not get Greece back on its feet..or Portugal, Ireland or Spain...

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It is only a matter of time before the default happens.

 

Since Greece has no way to devalue the price of what little exports they do have, or tourism the main industry, they are screwed.

 

Cutting government waste, corruption and collecting more tax revenue won't do it without growth in the economy. And it is doubtful they will be successful at any of these steps anyway.

 

But without a way to devalue there will be no growth.

 

Tick, tock. :cinema:

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