"If your opponent is of choleric temperament, seek to irritate him." - Sun Tzu
The economies of Europe simply aren't integrated enough to make it work. Ireland, Germany, and Greece have very little in common with one another, and it's foolish to think that a unified monetary policy is appropriate for such a diverse group of economies. This sovereign debt crisis will happen over and over again, every time there is a recession, until nations start to abandon the euro.
And the comparison to the US economy is silly. The US states are very unified economically, and so a common currency makes sense on this side of the Atlantic. Over here, most spending is done by the federal government (as opposed to the EU government which has very little tax-and-spend power). So even if a few states get in trouble with their finances, they don't pose a serious danger to the dollar as a whole. Even if California were to default, the federal government would continue to send out the social security and medicare checks to Californians. There is no equivalent in the EU.
Last edited by Kandahar; 12-11-10 at 04:00 AM.
Are you coming to bed?
I can't. This is important.
Someone is WRONG on the internet! -XKCD
Also you are not being realistic. The cost of going out of the Euro will bankrupt all countries but France and Germany. After all any debt they do have will be in Euros, and if they start devaluing their "new currency" then that debt would explode basically sealing their fate. And in the end it would not change anything. At least in the Eurozone countries are forced to deal with the structural problems that lead to any problems they are in.
No it is not. Public owned companies and state debt are not counted in the US debt numbers. But all of a sudden the right wingers want to include public companies in Europe?And the comparison to the US economy is silly.
That may be, but the state spending (and debt) in considerable amount of US states is still more than that of many European countries. In fact from what I can gather, state and local spending accounts for 46% of all spending in government in the US.The US states are very unified economically, and so a common currency makes sense on this side of the Atlantic. Over here, most spending is done by the federal government (as opposed to the EU government which has very little tax-and-spend power).
A few? What about most? You are aware that if you apply the same standards that are being applied on European countries by mostly US based media, then the US would be in the ****ter right?So even if a few states get in trouble with their finances, they don't pose a serious danger to the dollar as a whole.
If California were to default, the other states and the Feds would bail em out. Hence any debt and deficit by California or other states should be included in the over US debt picture, but they are not. And California is not the worst state, their debt burden is relatively small.. Ever look at Alaska? 70+% debt vs GDP.. Alaska is a freeloader state or Greece 2.0 on steroids. It gets most money per capita from the Feds and has the largest amount of liabilities per capita in the US. Their whole state pension system is pretty much unfunded.Even if California were to default, the federal government would continue to send out the social security and medicare checks to Californians. There is no equivalent in the EU.
Last edited by PeteEU; 12-11-10 at 04:47 AM.
Originally Posted by Jerry
here we go again
Greece slams moodys after ratings cut
Spain's savings banks race to find funds by Thursday
portugal edges closer to crisis: http://www.nzherald.co.nz/business/n...ectid=10710543
Last edited by The Prof; 03-07-11 at 04:19 PM.
Indeed, in its February 2011 review, the IMF noted progress but also indicated that "major reforms" still need to be devised and then implemented if Greece is to achieve fiscal sustainability. In part, the IMF's report stated:
Our overall assessment is that the program has made further progress toward its objectives. While there have been delays in some areas, the underlying fiscal and broader reforms necessary to deliver the program’s medium-term objectives are being put in place. However, major reforms still need to be designed and implemented to build a critical mass necessary to secure fiscal sustainability and economic recovery.
It's those "major reforms" that are likely to be most politically contentious. Yet, without the restructuring of select programs, Greece will face a growing risk of partial or full default.
not in the least surprising
as a matter of fact, it was all utterly predictable many years ago
who's gonna be surprised when the next shoe falls---in washington, brussels, lisbon, dublin, sacramento, springfield, albany...
Where's Spock when you need him?
"Captain, Mr Teixeira made a thinly veiled attack on Germany's Angela Merkel and France's Nicolas Sarkozy. The country was at the mercy of global forces and may be forced to call for help. Activating the EU-IMF bail-out mechanism, Captain, is not advised. You are inherently risking a debt-compound trap if you do so as this could create a self-fulfilling prophecy towards default."
that sounded like something straight out of sci-fi
A screaming comes across the sky.
It has happened before, but there is nothing to compare it to now.Pynchon - Gravity's Rainbow