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Eric Stoner
10-24-2011, 10:47 AM
That's what you would think, but the inability of a person/country to pay a loan hasn't always stopped banks and other financial institutions from providing them with one.

Sad but true. Sad but true.

Melonie
10-24-2011, 03:45 PM
Countries with unstable economies/currencies would most likely have to borrow money from themselves, since nobody else in their right mind is going to risk lending them money at anything resembling a reasonable interest rate !


That's what you would think, but the inability of a person/country to pay a loan hasn't always stopped banks and other financial institutions from providing them with one.

Your observation is undoubtedly true ... but arguably was NOT the result of 'free market' lending decisions by the financial institutions which originated such loans ! I won't elaborate other than to point out that, so far at least, the Greeks' creditors / bondholders have not been able to come up with a 'lender of last resort' upon which to transfer the loss risk.

masala
10-28-2011, 06:02 AM
Interesting and to add the US dollar has been temporarily strengthened and is now once again loosing steam as prices of gold and silver are once again increasing. The inflation is ridiculous and now the fed is yes you guessed it hitting the printing rescue button or the make your worthless maker more worth less button.

randomguy
11-01-2011, 09:22 AM
To be honest, this is a simple one. I saw that trader and what he said about himself was correct but what he said about the Eurozone market crashing is unlikely.

You see, the problem with the eurozone as has been known for a long time is that it has a free trade union, a monetary union but only limited fiscal intergration and separated bond markets (debt markets).

So if the euro survives which it will if people are willing to take a hit to their living standards to pay for its survival which I believe they are.

There are only 2 ways 2 go:
1. Disband the euro and become separate nation states or
2. become even more integrated like a single federal nation like america.

It seems the eurozone have agreed on the 2nd which is great for europe long term but bad for America as it creates a stronger trading block competitior.

The 2 things the Euro zone would have to do before it stops being a free trade union and essentially becomes 1 giant super state is as mentioned before:
1. Merge Debt Markets and
2. Full Fiscal Union, ie. one nation setting its own taxes in a federal system like america

both of the above seem very likely in the current climate. We might have the birth of a new nation on our hands.

Melonie
11-01-2011, 02:13 PM
^^^ actually, that possibility isn't entirely fictional ...



(snip)Greeks angry at the fate of the euro are comparing the German government with the Nazis who occupied the country in the Second World War.

Newspaper cartoons have presented modern-day German officials dressed in Nazi uniform, and a street poster depicts Chancellor Angela Merkel dressed as an officer in Hitler’s regime accompanied with the words: ‘Public nuisance.’

She wears a swastika armband bearing the EU stars logo on the outside.

The backlash has been provoked by Germany’s role in driving through painful measures to stop Greece’s debt crisis from spiralling out of control.

Greeks are furious at the deal, even though it means the banks will write off 50 per cent of the country’s debt and Socialist prime minister George Papandreou said Greece had ‘avoided a mortal national danger’

Opposition parties blasted the landmark agreement, with conservatives warning it condemned the country to ‘nine more years of collapse and poverty’.

But it is the fury of ordinary Greeks which is raising eyebrows.

Greek government officials who agreed to the belt-tightening moves have been portrayed in cartoons giving the Nazi ‘Sieg Heil’ salute.

And German visitors flocking to ancient tourist sites are being met with a hostile welcome from some Greeks.

Berlin’s interference has revived historical enmities and evoked comparisons to the massive destruction of Greece at the hands of Hitler’s Germany more than 65 years ago."(snip)

Eric Stoner
11-02-2011, 09:53 AM
To be honest, this is a simple one. I saw that trader and what he said about himself was correct but what he said about the Eurozone market crashing is unlikely.

You see, the problem with the eurozone as has been known for a long time is that it has a free trade union, a monetary union but only limited fiscal intergration and separated bond markets (debt markets).

So if the euro survives which it will if people are willing to take a hit to their living standards to pay for its survival which I believe they are.

There are only 2 ways 2 go:
1. Disband the euro and become separate nation states or
2. become even more integrated like a single federal nation like america.

It seems the eurozone have agreed on the 2nd which is great for europe long term but bad for America as it creates a stronger trading block competitior.

The 2 things the Euro zone would have to do before it stops being a free trade union and essentially becomes 1 giant super state is as mentioned before:
1. Merge Debt Markets and
2. Full Fiscal Union, ie. one nation setting its own taxes in a federal system like america

both of the above seem very likely in the current climate. We might have the birth of a new nation on our hands.

I hope you are joking because what you prescribe is a recipe for disaster. It would be another Yugoslavia , another Austro-Hungarian Empire , probably the closest thing to a reborn Roman Empire. None of which ended well.

Who is going to be in charge of this "United States of Europe " ?

Do you seriously think they can agree to a constitution for this entity ?

I'm sorry but this is a utopian idea that ignores national and cultural differences and is unworkable.

Melonie
11-02-2011, 10:19 AM
from Charles Hughes Smith at


(snip)"Democracy Is Tolerated Until It Threatens Global Markets

Greek Prime Minister George Papandreou's call for a citizens' referendum to decide the future of Greece is direct participatory democracy in action. Yet the European leadership and the Elites who need global markets to remain in nosebleed territory are outraged by this unscripted emergence of democracy.

The absurdly hostile reaction to democracy in action reveals the ugly, sordid truth, not just in Europe but in the U.S. and other faux democracies: democracy is tolerated until it threatens the global markets that empower the financial/political Elite. Then it becomes a mortal danger to be subverted or overthrown.

The message is clear: saving the Eurozone's banks and Elite bondholders is more important than mere democracy or national sovereignty. Here is a typical apologist's handwringing angst over the terrible consequences of Capitalism with a capital C in action: banks which assessed the risks and offered loans to Greece on terms they reckoned profitable are now the victims who must be "rescued" by the debtors.

At the border between East and West, faced with the choice between isolation and Europe, one step away from losing all that we achieved and sinking into our worst selves, we seek excuses to abandon our rescue.

"Our rescue"? Talk about the "Big Lie" and propaganda making "up" into "down." The "rescue" is not a rescue of Greece, it is a rescue of the overleveraged, politically untouchable big banks and the wealthy holders of Greek bonds.

This apologist makes another assumption which has no basis other than a Cargo Cult belief that is constantly deployed by "rescue the banks and bondholders" apologists: that the euro is the linchpin of Eurozone integration. It is not. there is no reason that all the other aspects of Euro integration couldn't remain firmly in place if nations within the Eurozone abandon the euro as their national currency.

Yes, the expense of currency exchange will return to the economies which exit the euro, but this is not some sort of insurmountable burden; Europe already has to exchange Swiss francs, U.S. dollars, Canadian dollars, Aussie dollars, British pounds, etc.

The assumption that the "grand project" of European integration will somehow collapse in a heap if the Too Big To Fail Eurozone banks are recognized as insolvent and are liquidated, and various nations revert to their national currencies, is revealed as baseless. There is simply nothing to support this shrill claim, which is repeated as if it had the veracity of gravity. It is merely blatant fearmongering of the most absurdly transparent "the world will end if you don't save our banks!" variety.

What Europe is proposing in subverting Greece's referendum is in essence a coup d'etat. What else can we make of this headline from Bloomberg, reprinted by Zero Hedge? Netherlands Will Try to Get Greek Referendum Canceled, PM Says. What exactly do the Dutch have to do with the domestic democracy of Greece, other than their banking sector might suffer the consequences of bad bets and idiotically poor risk management of debt duly offered to Greece for a profit?

Let's be clear about one thing here: nobody put a gun to the head of the Eurozone banks or Power Elites to force them to loan money to Greece or buy its bonds. Not only do the Eurozone leaders want to dispense with democracy when it becomes an inconvenient roadblock to their grandiose plans of transnational control of all Europe, they also find Capitalism an intolerable burden when "the other half" of open-market Capitalism--writing down losses-- kicks in.

And let's remember who owns the banks and the bonds--a global financial Power Elite. The ceaseless fear-mongering--Europe will dissolve into open warfare if we don't get our way, etc.-- is all aimed at cowing the average taxpayer into ponying up trillions of euros (or equivalent) to make sure the banks and Power Elites don't lose any capital, even though they risked that capital and thus deserve the losses."(snip)

(snip)"A lot of people have a financial incentive to support a coup d'etat in Greece and other indebted nations, and to subvert both democracy and Capitalism: everyone with direct ownership of stocks and bonds, or indirect ownership via pension funds. Here's the thing: democracy is messy, which is why monarchies, dictatorships, Elites, Oligarchies, Plutocracies and Corporatocracies all fear and revile it. Capitalism is also messy, as mistakes must be paid for in cash, and so the Elites also fear and revile Capitalism.

What all Elites want are the goodies of democracy and Capitalism but none of the costs. Sorry, transnationalists, crony capitalists, financial oligarchs and their assorted toadies and lackeys: you can't have it both ways. If you want the stability of democracy, then you have to let the citizens of Germany, Greece et al. all decide if they want to yoke themselves to the debt machine for decades in service of banks and Power Elite bondholders. If you want the immense profits of free-market Capitalism, then you have to accept the stupendous losses when leverage and over-indebtedness have rendered banks and nations insolvent.

Everybody knows the Irish, Portuguese, Spanish, Italians and Greeks are unhappy about the subversion of their sovereignty, but the Germans aren't all that overjoyed about it, either. I have received a number of thoughtful, well-informed letters from citizens of Germany who detailed at great length how the average German worker and citizen has not just failed to benefit from the ideological straitjacket of the euro, he/she has actively lost ground to inflation, higher taxes and stagnant wages in the past decade.

Maybe it's time for referendums in every Eurozone nation, and not just in Greece. Perhaps the citizens of Europe would choose, if given the chance to decide their future, to slip the shackles of the euro, but maintain the other practical aspects of integration: easier travel and work rules, etc.

Such a spread of direct democracy would threaten the dominance of the Eurozone's Power Elites and financial 1%, just as Capitalism in action would destroy their phantom wealth and the power it has purchased."(snip)


Forgive me if this is too 'political', but the entire topic is inexorably linked to EuroZone banks, tax revenues, gov't spending, gov't debts, and therefore politics.



Who is going to be in charge of this "United States of Europe " ?

one possibility ...


http://i.dailymail.co.uk/i/pix/2011/10/27/article-2054406-0E8F0F6300000578-460_634x970.jpg


^^^ before jumping on my case, be aware that this picture is comes from mainstream GREEK new media !!! It is the GREEKS thenselves who have a growing fear of this possibility. And there's certainly historical precedent that the possibility does exist. However, in the past, such events haven't ever been characterized as a creditor country 'foreclosing' on a defaulting indebted country !

~

Eric Stoner
11-02-2011, 11:56 AM
O.K. Lets' suppose the spoiled brat citizens of Greece vote down the austerity. Which is very likely btw. Then what ? Greece will have to default and there will be a run on Greek banks. Throughout his career Papandreou has been known for having a spine like a wet noodle. His call for a referendum is the ultimate act of political cowardice on his part and is a cheap attempt to blackmail the rest of Europe into giving Greece a better deal.

This is why I keep saying that that the other European countries MUST backstop their own banks so that when Greece defaults ; not IF ; there will not be a run on their banks.

While the fallout , other than the psychological , here in the U.S. has been limited , it has had one corollary benefit. Exposing Jon Corzine once and for all for the reckless asshole that he is. Not only has his company MF Global gone belly up, but hundreds of millions in customer money is missing. Since taking over about a year ago, MF bet heavily on European ( including Greek ) bonds and lost big. The FBI is investigating and Corzine's political pals are running for cover. We are talking about a guy who ran Goldman Sucks during the LTCM fiasco and was part of its bailout. Obviously he forgot everything he SHOULD have learned about managed risk and leverage.

Circling back to Mr.Smith's point it raises the question as to how much "democracy" a single currency and the EU itself can truly foster ?

mikef
11-02-2011, 01:35 PM
I hope you are joking because what you prescribe is a recipe for disaster. It would be another Yugoslavia , another Austro-Hungarian Empire , probably the closest thing to a reborn Roman Empire. None of which ended well.

Who is going to be in charge of this "United States of Europe " ?

Do you seriously think they can agree to a constitution for this entity ?

I'm sorry but this is a utopian idea that ignores national and cultural differences and is unworkable.


+ 1.... They are having a tough enough time keeping this thing together.


In other Greek News..... Never a good sign.


Opposition fury over sackings of Greek military chiefs

(Reuters) - Greece's opposition reacted with outrage on Wednesday to the sacking of its military chiefs, calling it a bid to stack the armed forces with party loyalists before a possible government collapse over the country's debt crisis.

http://www.reuters.com/article/2011/11/02/us-greece-govt-military-idUSTRE7A11RP20111102

Melonie
11-02-2011, 01:37 PM
^^^ arguably Corzine and Papandreu shared the same 'vision' ... that the global economic 'powers that be' would never allow the holders of Greek bonds, from the EuroZone banks to the US counterparties, to be forced to take a loss of principal.

As to a 'regime change' at the top of the Greek military, this may not matter now that the Germans and French military have finished their 'practice runs' in Libya ! Personal opinion here that SOME serious action will be taken if in fact the Greeks vote to default on their Euro deonominated debt and hand their bondholders huge losses by returning to a ( vastly devalued ) Drachma.

Eric Stoner
11-03-2011, 09:20 AM
Well it looks like there will not be a referendum after all and that Papandreou might or might not resign as P.M.
Obviously the situation is very fluid and nobody knows what will end up happening.
Most in Greece do NOT want to leave the E.U. and the Euro. It has been very good to them as they have gotten billions in subsidies and other aid from the E.U. AFTER they lied about their fiscal condition to gain entry in the first place.

Citychick
12-11-2011, 10:05 AM
I was just re-reading this subject in light of this weeks news (Britain EU treaty veto).

Melonie
12-11-2011, 12:08 PM
^^^ that will probably wind up being an interesting 'side show' for everyone not living in the UK !

from


(snip)"The political rift between the UK Prime Minister David Cameron (Conservative) and the Deputy Prime Minister Nick Clegg (Liberal Democrat) widened into a public feud over Cameron's refusal to sign the Merkozy accord.

The Deputy Prime Minister says U.K. Coalition Breakup Over EU Would Cause Economic ‘Disaster’

U.K. Deputy Prime Minister Nick Clegg said a breakup of the coalition government would spell “economic disaster” for Britain while saying he was “bitterly disappointed” by last week’s European Union summit.

Prime Minister David Cameron’s refusal to back a 27-nation pact to tighten budget rules may leave the U.K. “isolated and marginalized within the European Union,” Clegg told the British Broadcasting Corp.’s “Marr” program today. Still, he said “it would be even more damaging for us as a country if the coalition government was now to fall apart. It would create economic disaster.”

By refusing the join the planned fiscal accord, Cameron strengthened that wing of his Conservative party who want Britain to leave the EU. He also caused the biggest rift with his coalition partners since both parties campaigned on opposite sides of a May referendum on overhauling Britain’s voting system.

A poll by Survation for the Mail on Sunday today showed that almost two-thirds of voters said Cameron was right to back out of the EU accord, while 48 percent said Britain should leave the EU altogether. A poll by ComRes, carried out just before the summit for the Independent on Sunday, showed 52 percent of Britons say the euro crisis is an ideal opportunity for the U.K. to leave the EU.

Clegg said that Cameron had been placed in a “difficult position” at the Dec. 8 to Dec. 9 EU meeting because he faced “intransigence” from France and Germany. Nevertheless, he added that the government should now “fight, fight and fight again” for Britain’s interests within the EU.

Not Good Enough

Cameron told reporters following the all-night talks that “what was on offer just wasn’t good enough for Britain. It’s better to allow those countries to do their own thing on their own.”

Paddy Ashdown, a former Liberal Democrat leader, today criticized the move, saying Cameron’s decision “doesn’t make it easier” to get the U.K. through the economic crisis. “Cameron has acted as the leader of the Conservative Party and not the prime minister of Great Britain,” he told Sky News.

Simple Math

Let me point out some simple math to Paddy Ashdown: Two-thirds of voters approve of Cameron's decision not to sell the UK down the river. Thus Cameron not only acted as Conservative leader, but rather for all of the UK.

Moreover, I might point out, Cameron should go one step further and call for a referendum to leave the EU. Let the voters decide (snip)


I would also comment that, for history buffs, there are an increasing number of European parallels to the late 1930's taking shape ...

mikef
12-11-2011, 12:48 PM
It's kind of funny how the pols that are listening to their constituents are described in unflatering terms..... While those that go against the wished of their people and want to bailout banks and other soverigns are seen as leaders...... Ireland comes to mind.

Melonie
12-11-2011, 11:40 PM
^^^ risking the 'politics ban', I would only comment that the mainstream media institutions that choose to 'spin' certain news reports in certain ways are not owned by the 'majority of registered voters' !!!

As to Ireland, arguably PM Cameron just potentially saved Ireland itself ... and Microsoft ... and a host of other nominally US companies ... from economic disaster !!! Remember that it is Ireland's extremely low corporate tax rates that has both acted as a 'magnet' for worldwide companies to set up divisions there, as well as allowing Microsoft et. al. to legally avoid paying billions of dollars worth of US corporate income taxes on sales and royalties earned outside the USA ( that were routed through an Irish sub-division ).

Arguably, by turning down the EU 'compromise', thus turning down the future necessity of 'harmonizing' UK tax rates to EU tax rates, PM Cameron preserved the 'status quo' of the UK / Irish tax advantages, as well as other financial advantages offered by trading stocks and commodities within the City of London. At the same time, failure to eliminate the UK's / Ireland's tax preferred status leaves the rest of the EU at a competitive disadvantage ( arguably something that the Germans and French were already miffed about and are now fuming over ! ).

America obviously has vested interests on 'both sides of the street' ... with some relieved that the huge 'tax loophole' which supports Silicon Valley is still left intact, while others are miffed that the UK's / Ireland's tax preferred status will continue to cost the IRS trillions of dollars in lost US corporate tax revenues, as well as continuing to 'cost' New York based stock and commodity traders some amount of international investor business thus US tax revenues.

Not wanting to speculate too deeply ... but this amounts to an increasingly polarized situation where you have ...

Germany, France, most of northern Europe united on one position ...

The UK standing firm with a very different position ...

the US having interests on 'both sides of the street' ...

Russia and Germany / France seeking closer trade co-operation, i.e. French finance facilitating Russian oil & gas in exchange for German high technology

'deja-vu' anyone ?

~

mikef
12-12-2011, 02:36 PM
...... Edit...... Original post while not controversial..... It was not in keeping with the politics ban...... So never mind. ;D

Citychick
12-16-2011, 08:03 PM
^^^ risking the 'politics ban', I would only comment that the mainstream media institutions that choose to 'spin' certain news reports in certain ways are not owned by the 'majority of registered voters' !!!



~

And what a spin it is turning out to be.
Very much of the vein that "The Uk will now be boycotted by the rest of Europe and then become irrelevant to Washington."

Melonie
12-16-2011, 11:12 PM
from

Eurozone government defaults looking certain
by Alasdair Macleod - Finance And Economics.org

(snip)For some time I have taken the view that rescuing eurozone governments from their financial crises was too big a job for the European Central Bank, which should stick to keeping the banking system going. The only hope was that individual governments would be forced to face up to the reality of cutting government spending hard and quickly. They have failed to even begin to address this fundamental problem. As a consequence, it is now impossible for them to roll over their maturing debt, let alone raise new money. Instead there is now a scramble into cash as banks and hedge funds prepare themselves for sovereign defaults.

Posturing over geared stability funds, financial transaction taxes, installing unelected governments, putative treaty changes and finally enhanced fiscal supervision proposals have finally convinced markets that the only outcome is widespread government defaults. There is now no alternative and the fallout will have to be managed.

The inept handling of this crisis has weakened the eurozone’s banks to the point that they are unable to subscribe for more debt. Furthermore, the ECB cannot afford to see the liquidity it provides to European banks disappear into new government bonds that will default anyway. Therefore, it is now in the ECB’s interest to see sovereign defaults occur as soon as possible, unless the International Monetary Fund can come to the rescue, which is looking less likely by the day.

There is growing evidence that there is insufficient support for an IMF bailout from its member governments. The IMF’s charter is as an intergovernmental lender of last resort, not a supporter of government profligacy. Following the failure of the G20 meeting in mid-October there has been no substantive attempt to rescue the eurozone. The telephones might be buzzing, but there is no urgent meeting, suggesting that events must take their course.

So the quicker these defaults happen, the sooner the ECB can work with the national central banks to bail out the major Eurozone commercial banks. Once we accept this line of reasoning, we must think about the likely candidates. In no particular order they are France, Italy and Greece: France and Italy because they have to roll enormous amounts of debt in the coming months and Greece for obvious reasons. Less pressing perhaps but also likely default candidates are Belgium, Spain, Portugal and Ireland: Belgium might fall with France and the others have the potential to struggle through but might chose to wipe the slate clean. And when the first goes, the rest will surely follow rapidly.

The sequence of events is now under way. This will be followed by the defaults themselves, and the likely trigger will be escalating French government bond yields.

In summary, we have reached the point where the ECB’s vested interest requires eurozone governments to default because further delay will make the rescue of the currency and banking system more difficult. Expect co-ordination between the Bank for International Settlements, The Fed, Bank of England and Bank of Japan to smooth markets through the turmoil and to back up the ECB.(snip)


From a personal prognostication viewpoint, I'm 'betting' that the ECB plus other 'hidden hands' will do everything in their power to avoid defaults for the balance of December ... to allow banks, corporations etc. to 'close their books' on 2011 without too much red ink. However, once January arrives ...

eagle2
12-22-2011, 11:46 PM
I would also comment that, for history buffs, there are an increasing number of European parallels to the late 1930's taking shape ...

Your statement has nothing to do with reality. You're just making stuff up.

Melonie
12-23-2011, 07:50 AM
I'm unable to respond directly due to the 'politics ban' ... so the best I can probably 'get away with' is to allow UK's former Prime Minister Gordon Brown to 'make up' exactly the same 'stuff' you accuse me of ...




(snip)""China must be persuaded to increase consumption," he [ Gordon Brown - sic ] said, touching on the core issue of East-West trade imbalances that lie behind the global crisis. China's consumption has actually fallen from 48pc in the late 1990s to 36pc of GDP, reflecting a deeply distorted economy.

The suggestion met a caustic response from Singapore's former foreign minister George Yeo Yong-Boon, sitting next to him. "China is not going to consume to save the world. It will act in its own enlightened self-interest," he said.

Chinese premier Wen Jiabao said earlier this week that his country will shift from export-led growth to greater internal demand under its new five-year plan, but this is unlikely to be fast enough to satisfy the rest of the world.

Mr Yeo said talk of global architecture is an attempt by Western countries to wriggle out of hard choices and "pass on their pain" to somebody else. The "Old Cathedral" of global affairs – built on American power – is crumbling and should not be rebuilt.

"China and India are going to grow whatever happens to the global system. The world will muddle along as it has for much of history," he said.

Mr Yeo called for a bout of "creative destruction" in the West, warning of "very painful" times as American and European workers learn to compete toe-to-toe with educated Asians willing to put in longer hours for much lower pay. This may test political systems to breaking point.

"If Greece leaves the euro, it is more likely the eurozone can be saved, and it would have an illuminating effect on politics in Europe," he said, echoing a widespread view among Asia's policy elite.

Mr Brown said the momentum from the G20 accord in 2009 had been squandered, degenerating into currency squabbles and misplaced obsession with fiscal austerity. Citing Winston Churchill's aphorism, he said leaders had been "resolved to be irresolute, adamant for drift, solid for fluidity, and all-powerful for impotence."

"Unless there is global co-ordination, I foresee 10 years of low growth in Europe and America, with very high levels on unemployment, that will lead in the end to greater protectionism. This is exactly like the 1930s."(snip)

~

Eric Stoner
12-23-2011, 09:12 AM
I'm unable to respond directly due to the 'politics ban' ... so the best I can probably 'get away with' is to allow UK's former Prime Minister Gordon Brown to 'make up' exactly the same 'stuff' you accuse me of ...


http://www.telegraph.co.uk/finance/financialcrisis/8768575/Gordon-Brown-fears-euro-crisis-worse-than-Lehman-as-1930s-beckon.html

(snip)""China must be persuaded to increase consumption," he [ Gordon Brown - sic ] said, touching on the core issue of East-West trade imbalances that lie behind the global crisis. China's consumption has actually fallen from 48pc in the late 1990s to 36pc of GDP, reflecting a deeply distorted economy.

The suggestion met a caustic response from Singapore's former foreign minister George Yeo Yong-Boon, sitting next to him. "China is not going to consume to save the world. It will act in its own enlightened self-interest," he said.

Chinese premier Wen Jiabao said earlier this week that his country will shift from export-led growth to greater internal demand under its new five-year plan, but this is unlikely to be fast enough to satisfy the rest of the world.

Mr Yeo said talk of global architecture is an attempt by Western countries to wriggle out of hard choices and "pass on their pain" to somebody else. The "Old Cathedral" of global affairs – built on American power – is crumbling and should not be rebuilt.

"China and India are going to grow whatever happens to the global system. The world will muddle along as it has for much of history," he said.

Mr Yeo called for a bout of "creative destruction" in the West, warning of "very painful" times as American and European workers learn to compete toe-to-toe with educated Asians willing to put in longer hours for much lower pay. This may test political systems to breaking point.

"If Greece leaves the euro, it is more likely the eurozone can be saved, and it would have an illuminating effect on politics in Europe," he said, echoing a widespread view among Asia's policy elite.

Mr Brown said the momentum from the G20 accord in 2009 had been squandered, degenerating into currency squabbles and misplaced obsession with fiscal austerity. Citing Winston Churchill's aphorism, he said leaders had been "resolved to be irresolute, adamant for drift, solid for fluidity, and all-powerful for impotence."

"Unless there is global co-ordination, I foresee 10 years of low growth in Europe and America, with very high levels on unemployment, that will lead in the end to greater protectionism. This is exactly like the 1930s."(snip)

~

It might be worse than that. Here in the U.S. we have plenty of folks who forgot how well Smoot- Hawley worked out in the 1930's. Prominent conservatives and liberals have both called for greater protectionism

eagle2
12-23-2011, 09:57 PM
What was happening in the 1930's was the rise of fascist dictators and preparations for war by the leading powers at the time. Neither is happening now.

Melonie
12-24-2011, 05:34 AM
since responding directly would again put me in violation of the 'politics ban', all I can suggest is that you broaden your observance of current events a bit ...





And for what it's worth, I would simply point out that most of the 1930's national leaders were willingly elected into office by voters who 'believed' promises that the very bad economic conditions they were enduring in the early 1930's would be improved if only they allowed particular gov't policies to be enacted. Also, if you perform some historical research, you'll find one well known 1930's national leader was specifically elected on a platform of A. repudiating his country's onerously burdensome foreign debt payments, B. instituting a 'stimulus' package based on gov't construction of infrastructure projects to provide new jobs, and C. issuance of a new national currency that was 'decoupled' from the rest of Europe. Sound familiar to any EuroZone countries today ?

What's that famous old adage ... 'those that refuse to learn from history are doomed to repeat it' ???

The Jackal
12-25-2011, 11:49 AM
One thing that is quite transparent is that there is a serious disparity among the various nations of EU. On the one hand you have Germany which is heavily industrialized and on another hand you have nations like Greece which are not quite as industrialized. As a result, Germans and probably French as well are ending up picking all the deficit tabs for not so industrialized members of EU. This arrangement is not going to last too long. Something is going to give.

eagle2
12-26-2011, 12:07 AM
since responding directly would again put me in violation of the 'politics ban', all I can suggest is that you broaden your observance of current events a bit ...

http://www.debka.com/article/21577/

http://www.nytimes.com/2011/12/04/world/middleeast/egypts-vote-propels-islamic-law-into-spotlight.html?_r=1&ref=israel

And for what it's worth, I would simply point out that most of the 1930's national leaders were willingly elected into office by voters who 'believed' promises that the very bad economic conditions they were enduring in the early 1930's would be improved if only they allowed particular gov't policies to be enacted. Also, if you perform some historical research, you'll find one well known 1930's national leader was specifically elected on a platform of A. repudiating his country's onerously burdensome foreign debt payments, B. instituting a 'stimulus' package based on gov't construction of infrastructure projects to provide new jobs, and C. issuance of a new national currency that was 'decoupled' from the rest of Europe. Sound familiar to any EuroZone countries today ?


You're making stuff up again. There was no European currency in the 1930's. The well known leader you are referring to, did not run on repudiating foreign debt payments or instituting a 'stimulus package'.



What's that famous old adage ... 'those that refuse to learn from history are doomed to repeat it' ???

Is there any saying for people who make stuff up?

All you are doing is trying to paint the most pessimistic picture possible. You have no regard for facts. You just want to make the situation look as bad as possible, and you just make stuff up to go along with your doom and gloom outlook.

There is no chance of a major world war starting in Europe.

Melonie
12-26-2011, 01:40 AM
I don't know why I still bother ... but here you go ... from


(snip)"When Hitler came to power, the country was completely, hopelessly broke. The Treaty of Versailles had imposed crushing reparations payments on the German people, who were expected to reimburse the costs of the war for all participants — costs totaling three times the value of all the property in the country. Speculation in the German mark had caused it to plummet, precipitating one of the worst runaway inflations in modern times. At its peak, a wheelbarrow full of 100 billion-mark banknotes could not buy a loaf of bread. The national treasury was empty, and huge numbers of homes and farms had been lost to the banks and speculators. People were living in hovels and starving. Nothing quite like it had ever happened before - the total destruction of the national currency, wiping out people's savings, their businesses, and the economy generally. Making matters worse, at the end of the decade global depression hit. Germany had no choice but to succumb to debt slavery to international lenders.

Or so it seemed. Hitler and the National Socialists, who came to power in 1933, thwarted the international banking cartel by issuing their own money. In this they took their cue from Abraham Lincoln, who funded the American Civil War with government-issued paper money called "Greenbacks." Hitler began his national credit program by devising a plan of public works. Projects earmarked for funding included flood control, repair of public buildings and private residences, and construction of new buildings, roads, bridges, canals, and port facilities. The projected cost of the various programs was fixed at one billion units of the national currency. One billion non-inflationary bills of exchange, called Labor Treasury Certificates, were then issued against this cost. Millions of people were put to work on these projects, and the workers were paid with the Treasury Certificates. This government-issued money wasn't backed by gold, but it was backed by something of real value. It was essentially a receipt for labor and materials delivered to the government. Hitler said, "for every mark that was issued we required the equivalent of a mark's worth of work done or goods produced." The workers then spent the Certificates on other goods and services, creating more jobs for more people.

Within two years, the unemployment problem had been solved and the country was back on its feet. It had a solid, stable currency, no debt, and no inflation, at a time when millions of people in the United States and other Western countries were still out of work and living on welfare. Germany even managed to restore foreign trade, although it was denied foreign credit and was faced with an economic boycott abroad. It did this by using a barter system: equipment and commodities were exchanged directly with other countries, circumventing the international banks. This system of direct exchange occurred without debt and without trade deficits. Germany's economic experiment, like Lincoln's, was short-lived; but it left some lasting monuments to its success, including the famous Autobahn, the world's first extensive superhighway.1

Hjalmar Schacht, who was then head of the German central bank, is quoted in a bit of wit that sums up the German version of the "Greenback" miracle. An American banker had commented, "Dr. Schacht, you should come to America. We've lots of money and that's real banking." Schacht replied, "You should come to Berlin. We don't have money. That's real banking."(snip)


Admittedly a whole lot of 'making up history' has taken place. However, a good portion of 'revisionist history' can be found in textbooks, academic papers, and mainstream media spin.


(snip)"In Billions for the Bankers, Debts for the People (1984), Sheldon Emry commented:

Germany issued debt-free and interest-free money from 1935 and on, accounting for its startling rise from the depression to a world power in 5 years. Germany financed its entire government and war operation from 1935 to 1945 without gold and without debt, and it took the whole Capitalist and Communist world to destroy the German power over Europe and bring Europe back under the heel of the Bankers. Such history of money does not even appear in the textbooks of public (government) schools today. "(snip)

~

glitzy
12-26-2011, 03:21 AM
Hey Melonie -- I know things have changed up on this board and I don't comment a lot in Dollar Den but I always appreciate your take on world events and using history as a basis to predict the future.

Melonie
12-26-2011, 03:54 AM
^^^ I appreciate your appreciation LOL. But to be totally accurate, I wasn't attempting a prediction ... merely pointing out that an unusual number of similarities exist between the current situation re Greece / Portugal / Italy etc. and a previous period of the early 1930's.


However, history does tend to show that the majority of humans will always act in ( what they believe to be, or what they have been told to be ) their own short term self interest ... even if such action turns out to be extremely negative in the long term !


"Who controls the past controls the future: who controls the present controls the past." George Orwell

~

Eric Stoner
12-26-2011, 07:43 AM
Trying to tip-toe around the politics ban, one might want to read up on what is happening in Hungary.

Secondly, if the suggested EU austerity policies all take effect, what will be the actual state of democracy in Europe ?

There is clearly tension between economic realities and democratic values and institutions in Europe.

Melonie
12-26-2011, 08:14 AM
Secondly, if the suggested EU austerity policies all take effect, what will be the actual stare of democracy in Europe ?

That was the essence of my earlier point ... where French and German proposed future PIIG country bailout 'loans' would be under terms where the French and German controlled EU could 'veto' the voter approved budgets of any PIIG country that chose NOT to adopt the austerity measures ( i.e. tax increases, social welfare spending cuts, gov't employment levels cut etc. ) required in exchange for receiving bailout money. Several commentators are already expecting that Italy and Ireland will 'bite the bullet', but that Greece, Portugal and Spain will be unable to convince their voters to go along with such austerity measures. As such, Greece, Portugal and Spain will very likely have no alternative besides #1 - having their de-facto gov't decisions taken over by the EU i.e. France and Germany, or #2 - exiting the EuroZone, re-adopting national currencies, seeing purchasing power / standard of living drop by a huge margin, and seeing 'riots in the streets'.

eagle2
12-26-2011, 12:45 PM
(snip)"In Billions for the Bankers, Debts for the People (1984), Sheldon Emry commented:

Germany issued debt-free and interest-free money from 1935 and on, accounting for its startling rise from the depression to a world power in 5 years. Germany financed its entire government and war operation from 1935 to 1945 without gold and without debt, and it took the whole Capitalist and Communist world to destroy the German power over Europe and bring Europe back under the heel of the Bankers. Such history of money does not even appear in the textbooks of public (government) schools today. "(snip)

~

You continue to amaze me with how crazy your posts are. It seems you are constantly trying to outdo yourself. First you praise the Nazis for forcibly sterilizing large numbers of people the state considers "disabled". Now you're posting disgusting nonsense that describes the war against the Nazis as a war to "bring Europe back under the heel of the Bankers", when it was the Nazis who started the war, and conveniently leaves out that the Nazis murdered millions of people.

eagle2
12-26-2011, 12:48 PM
Trying to tip-toe around the politics ban, one might want to read up on what is happening in Hungary.

Secondly, if the suggested EU austerity policies all take effect, what will be the actual state of democracy in Europe ?

There is clearly tension between economic realities and democratic values and institutions in Europe.

Argentina ignored the calls for austerity and now their economy is booming.

Melonie
12-26-2011, 02:32 PM
You continue to amaze me with how crazy your posts are

... and you continue to amaze me with how predictable your posts are.

A. if I reference historical fact that you find doesn't agree with your personal worldview / agenda / whatever, you claim that I am 'making things up'

B. after I refute your accusation of 'making things up' by citing actual factual references ( usually risking the politics ban in doing so ), you respond with some cherry picked point which, while true on the surface and apparently supportive of your attempted point, is an 'outlier' or 'special case situation' in historical terms - most recently Argentina ... whose economy was 'saved' via deliberately 'trashing' their currency in order to effectively repudiate their debts ( an option that doesn't exist for countries using the Euro ), as well as to book massive revenues from 'underpriced' exports ( an option which is unlikely to exist for Greece / Portugal / Spain because they simply do not have the capacity / natural resources to export any product which is in high demand worldwide ) .

C. after being called on both of the above, you then escalate to personal attacks ... often by attempting to 'put words in my mouth' - in this case implying that my much earlier cite of Germany's large scale sterilization program as historical fact ( in an entirely different thread and context ) somehow constitutes personal praise for Nazism on my part ( with your otherwise irrelevant holocaust references presumably thrown in to further emphasize my 'despicable' personal character )

One of the reasons that I resigned as moderator was to allow me to set aside neutrality and respond directly to this modus operandi and these personal attacks.


As to your last claim ... historical facts documented at

(snip)"The historical record, as represented by the German government at the time, on Bromberg "Bloody Sunday" and related incidents -- 58,000 claimed dead or missing by Feb 1940.

The German invasion was Sep 1939, but it's important to understand that many of the outrages had preceded the German invasion. This was proved by the amount of decomposition of the bodies. Thus, these atrocities cannot be excused simply as reprisals for the German invasion (which would be wrong anyway). They included 19 year-old girls with their faces smashed, amputations, disembowelments, shot thru' the eye, death-trauma births, you name it. Poles had been merrily slaughtering anything or anybody German since at least as early as April 1939, with smaller incidents stretching back to the close of WW I -- you haven't been told that by the Mass Media, or the fact that these atrocities were one of the main causes for the German invasion of Poland, something that was meant by the Germans to be a local solution to a local problem. Germany had already done the "right thing" by protesting in writing to the League of Nations literally dozens of times. The League of Nations did nothing, yet the problem had to be solved.

On Bromberg Bloody Sunday, thousands of ethnic Germans were slaughtered like pigs in an alley because the majority "poles" knew they could do so with total impunity. Marshal Pilsudski had died, and Britain's leaders had made unconditional guarantees to Poland as a pretense to ensure maximum political tensions in Eastern Europe to serve the interests of Soviet Russia. Poles in official capacity were openly laying claim to ancient German territory, were engaging in the crudest pea-brained saber-rattling, had engaged in border violations and boasted of marching thru' the gates of Berlin in 3 weeks (or days, depending on which buzzing brain was indulging in the fantasy). Poland had even stolen a chunk of "Czechoslovak" territory in early '39.

Few today weep for these innocent people. No Tom Brokaw pursing his lips over photos of them with a concerned expression, like he had just gulped a bushel of lemons. No Charles Kurrault telling folksy anecdotes about them, ending with "no, dear ones, we will not forget". No Richard D. Haffner, Ph.D. furrowing his professorial brow about them on his PBS talking head program. Nope, you'll see no paeans to these forgotten victims in our controlled, sycophantic media."(snip)


Please take note that I am not attempting to refute the popular view of history in the West that Germany was responsible for starting WW2 ... I am merely pointing out that historical evidence to the contrary also exists !!!


"History is written by the victors." -Machiavelli

"We have to live today by what truth we can get today, and be ready tomorrow to call it falsehood." -William James

"What is the first business of one who studies... To part with self conceit. For it is impossible for anyone to begin to learn what he thinks he already knows." -Epictetus (55-135) Greek Philosopher


~

The Jackal
12-26-2011, 10:09 PM
Brazilian economy overtakes UK's

eagle2
12-26-2011, 11:43 PM
C. after being called on both of the above, you then escalate to personal attacks ... often by attempting to 'put words in my mouth' - in this case implying that my much earlier cite of Germany's large scale sterilization program as historical fact ( in an entirely different thread and context ) somehow constitutes personal praise for Nazism on my part ( with your otherwise irrelevant holocaust references presumably thrown in to further emphasize my 'despicable' personal character )
~

You didn't just cite Germany's large scale sterilization program, you called it an "effective solution", which comes across to me as praise. There were other members of the forum who took it the same way, based on their comments. In your most recent post, you quoted a site that portrays Nazi Germany in a favorable way. Here's the quote again:

"Germany financed its entire government and war operation from 1935 to 1945 without gold and without debt, and it took the whole Capitalist and Communist world to destroy the German power over Europe and bring Europe back under the heel of the Bankers".

Again, the Allies weren't fighting to bring Europe "under the heel of bankers". The Soviet Union was fighting Nazi Germany because the Germans invaded their country. The U.S. entered the war because we were bombed by the Japanese and the Germans declared war on the U.S. a day or two later. Your article leaves out that the Nazis stole billions of dollars from their victims and made extensive use of slave labor.

I know you're not a stupid person. I'm sure you're aware of what the Nazis did. Can we agree that they should not be portrayed in a favorable way?

Melonie
12-27-2011, 03:16 AM
Can we agree that they should not be portrayed in a favorable way?

on a 'moral' basis, certainly !


However, from a purely economic standpoint, in fact the German gov't did adopt some very effective policies. Denying those economic facts via adopting a sweeping position that everything Germany did was 'immoral' is arguably a case of 'throwing the baby out with the bathwater'.

As to your issues with "it took the whole Capitalist and Communist world to destroy the German power over Europe and bring Europe back under the heel of the Bankers", from a purely economic standpoint this is also mostly true ! Germany, Vichy France, Belgium, Norway, Italy, Romania et al did wind up operating their WW2 economies without the 'benefit' of Western allied international bankers ! Of course, the occupying Germans also attempted to seize the gold reserves of these countries in order to back this 'independent' financing ... with mixed success.

And by sheer coincidence, this arguably brings us back full circle to today ... with the German and French led EU bailout effort attempting to impose a condition that european countries receiving future bailout funding must subjugate their own democratically decided gov't spending priorities to an EU bailout agency 'veto'. That 'veto' power would assure that austerity measures were implemented ( over the likely vehement objections of retirees, social welfare benefit recipients, gov't employees etc. in those countries ) such that the EU bailout agency would be repaid first !

~

Eric Stoner
12-27-2011, 07:44 AM
^^^ This is why I reluctantly agreed with and went along with the "politics ban". In a more perfect world, where EVERYONE had excellent reading comprehension skills AND an ability to remain objective and NOT personalize, I suppose we could make greater mention and wider use of historical references.

In fairness to Melonie, it requires a seriously tortured reading of her posts to turn her into some kind of Nazi sympathizer. In point of fact, the author she quotes got it quite wrong about the Nazi economy. The reality is that the Nazis created a faux prosperity by A. stealing ; B. starving and C. enslaving.

They stole gold from anyone and everyone. Starting with the Poles and then the Danes ( Norway smuggled out most of its gold reserves to Britain ) , Dutch, Belgians and French. They also negotiated VERY favorable trade terms with the Spanish, Swedes,Finns and even the Russians ( until June 1941). They stole art and sold it to the Swiss.

They let Europe starve while shipping all available foodstuffs to the Reich. And of course they made wide use of slave labor. Sort of like the Chinese today lol.

Not to mention their total control of wages, prices and everything else inside the Reich.

eagle2
12-28-2011, 09:52 AM
In fairness to Melonie, it requires a seriously tortured reading of her posts to turn her into some kind of Nazi sympathizer.

I never said anything about Melonie being some kind of Nazi sympathizer. I specifically criticized what she posted. Perhaps if you had better reading comprehension skills.



In point of fact, the author she quotes got it quite wrong about the Nazi economy.

and that is what I criticized.

Eric Stoner
12-28-2011, 12:03 PM
I never said anything about Melonie being some kind of Nazi sympathizer. I specifically criticized what she posted. Perhaps if you had better reading comprehension skills.



and that is what I criticized.

Maybe if you posted with greater clarity and less personalizing , it would be easier to give your posts a fair reading.

Why didn't you just do what I did and post a FACTUAL corrective ? The textbooks are full of analyses and critiques of Nazi economics. The fact is that Hitler et.al. ran a basket case economy. Although one with full employment ( Every slave laborer had a job.) And strict rationing. And declining agricultural production. And a vibrant black market. And even sluggish arms production until Albert Speer took over as Armaments Minister after the mysterious death of Fritz Todt. At the end of the war, the Wehrmacht was still dependent on horses for at least half of its transport.

There was no good reason for you to go after Melonie personally, except maybe to vent your own spleen. More's the pity because you have had little trouble in the past in trying to post facts to back up your opinions. Why don't you just go back to doing that ? We all know you don't like Melonie's opinions. Or even more amazingly , mine. Under the "politics ban", we are all supposed to agree to disagree and try to focus on the PRACTICAL , FACTUAL and APOLITICAL.

Until this little squabble, we've all been managing to get along rather well. It's almost a new year. Let's ALL try to put aside personal disagreements and try harder to avoid the politics.

I hope you enjoyed the holidays and I wish you well for 2012.

eagle2
12-28-2011, 11:43 PM
I didn't go after Melonie personally. I went after what she posted. I found what she posted very offensive, in that the article she linked to portrayed Nazi Germany in a positive way and the Allies as fighting to bring Europe "under the heel of the bankers". Perhaps Melonie wasn't able to see this, but that is what the article did. I doubt I'm the only one offended by articles that come across as supporting Nazi Germany.

Hope you enjoyed the holidays too and hope you have a good 2012.