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Ongoing European Debt Crisis

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Lock Space Wizard from Germany Since: Sep, 2010
Space Wizard
#201: Nov 27th 2011 at 9:30:45 AM

[up] Enlighten me/us.

Programming and surgery have a lot of things in common: Don't start removing colons until you know what you're doing.
RadicalTaoist scratching at .8, just hopin' from the #GUniverse Since: Jan, 2001
scratching at .8, just hopin'
#202: Nov 27th 2011 at 9:34:57 AM

Funny how we look at the 90s as a golden age. Clinton was deregulating the banks in the states with the overturn of Glass-Steagal, and Blair and Schroder were setting up the EU for this.

We didn't just walk into this mess, we charged headlong.

Share it so that people can get into this conversation, 'cause we're not the only ones who think like this.
Octo Prince of Dorne from Germany Since: Mar, 2011
Prince of Dorne
#203: Nov 27th 2011 at 9:45:54 AM

While it's true that "keeping it in Germany" is a solution of sorts, please bear in mind that Germany was one of the drivers behind the Euro in the first place and rode high for a long time on the excesses of the periphery which they now decry. As ye sow, so shall ye reap.
Ah now, who rides on a moralist high horse?

If people are buying stuff, the economy is active and productive. When they lose their jobs, they get unemployment checks for a while... Since the economy is active, it won't be long before they find jobs ('cause there will be jobs).
There is no such a thing as an economy constantly in the upswing. It's cyclical, and so far nobody has found any method to change that. (In fact, I think Keynesian economies in themselves are a good way to get a grip on the problem of economical cycles - the problem is just that Keynesianism is about throttling the cycle in both direction, i.e. also hampering upswing with high taxes and so on. But nobody does that part, and hence the money spent in crisis times never gets in again. That's why Keynesianism fails, because it's just about never properly executed.)

What is strange to me is that Switzerland isn't part of the Euro and yet our economy is being throttled by the Euro crisis - the inverse of Astronomical Exchange Rate. You keep the debt a-Ok, and yet you pay for it.
OTOH, due to the European debt crisis Switzerland has managed to sell debts with negative interest rates!. So that's one advantage for the country.

And can someone explain what an Greece/Italy/Germany exit is supposed to achieve?! It seems too much like "the Euro is the cause of the problem, so let's give it up and problem solved!" Um, no. An exit is not going to fix structural problems, for instance
It would achieve a sort of quarantine, seperating those countries with heavier structural problems from those with less structural problems. It could prevent that the former drag down the latter with them.

Funny how we look at the 90s as a golden age. Clinton was deregulating the banks in the states with the overturn of Glass-Steagal, and Blair and Schroder were setting up the EU for this.
Eh, Schröder was mostly 00s (98-05)tongue And I think it's still not entirely clear what his heritage is. Certainly his government (a nominally leftist coalition...) deregulated way too much, but I've also read many opinions that Germany is now doing more or less okay in part due to the structural reform it initiated in such places as welfare, short term labour, etc.

edited 27th Nov '11 9:47:22 AM by Octo

Unbent, Unbowed, Unbroken. Unrelated ME1 Fanfic
Lock Space Wizard from Germany Since: Sep, 2010
Space Wizard
#204: Nov 27th 2011 at 10:04:46 AM

Eh, Schröder was mostly 00s (98-05) and I think it's still not entirely clear what his heritage is.

Hartz IV springs to mind.

Programming and surgery have a lot of things in common: Don't start removing colons until you know what you're doing.
Octo Prince of Dorne from Germany Since: Mar, 2011
Prince of Dorne
#205: Nov 27th 2011 at 10:07:40 AM

Yes, but for all of its excesses, and the fact that it's too low especially for children, it did streamline the whole process.

Unbent, Unbowed, Unbroken. Unrelated ME1 Fanfic
Erock Proud Canadian from Toronto Since: Jul, 2009
Proud Canadian
#206: Nov 27th 2011 at 1:39:35 PM

@Lock: Aw, yes, I should have expalined.

The Chretien Liberal government in Canada did several very important things that were instrumental in Canad avoiding the crisis:

  • Balanced the budget for a surplus
  • Paid off massive portions of the debt
  • Banned politcal doantions form unions and corporations outright
  • Left a strong budget for the future governments to take over
  • Did not get invovled in Iraq, saving billions

1-4 are key things A Merica should do.

@Radical: The 90s were a golden age -Communism fell and terrorism isn't a major enemy yet, the economy of the US is strong, and wages hadn't stagnated quite so much yet.

If you don't like a single Frank Ocean song, you have no soul.
Karmakin Moar and Moar and Moar Since: Aug, 2009
Moar and Moar and Moar
#207: Nov 27th 2011 at 2:32:16 PM

Well, Canada was pretty much on of the few countries that didn't act in such a fashion (in terms of bank deregulation and/or aggressive anti-inflation measures) to lead itself to be creamed over the last few years or so. And yes, that's mostly good on Cretien.

Of course, things are not perfect north of the border, as a lowering tide drops all boats, (Something the EU probably needs to learn and fast) but still, they're better than in most places.

Democracy is the process in which we determine the government that we deserve
johnnyfog Actual Wrestling Legend from the Zocalo Since: Apr, 2010 Relationship Status: They can't hide forever. We've got satellites.
Actual Wrestling Legend
#208: Nov 27th 2011 at 3:29:15 PM

It's been my observation that the EU's good points (casual border crossings) are pretty pitiful when compared with the downsides, such as increased wealth disparities (everyone predicted more jobs for poorer countries, but the rich nations got richer and the poor even poorer).

Maybe this whole mess was inevitable, and the whole thing should be scrapped. If anything, nation states ought to be shrinking, not growing.

I'm a skeptical squirrel
RadicalTaoist scratching at .8, just hopin' from the #GUniverse Since: Jan, 2001
scratching at .8, just hopin'
#209: Nov 27th 2011 at 3:35:30 PM

@Radical: The 90s were a golden age -Communism fell and terrorism isn't a major enemy yet, the economy of the US is strong, and wages hadn't stagnated quite so much yet.
I was aiming to make the point that we spent this golden age setting ourselves up for failure.

Share it so that people can get into this conversation, 'cause we're not the only ones who think like this.
Erock Proud Canadian from Toronto Since: Jul, 2009
Proud Canadian
#210: Nov 27th 2011 at 3:39:03 PM

[up]Look at history - that's what happens.

If you don't like a single Frank Ocean song, you have no soul.
whaleofyournightmare Decemberist from contemplation Since: Jul, 2011
Decemberist
#211: Nov 28th 2011 at 3:57:46 AM

This week we have bond sales for 4 of the Eurozone countries coming up and we'll know if the Euro will be around by January 1st by the end of the week.

Dutch Lesbian
Octo Prince of Dorne from Germany Since: Mar, 2011
Prince of Dorne
#212: Nov 28th 2011 at 4:08:43 AM

So apparently there are speculations about "elite" Euro bonds - i.e. common bonds by Germany, France, Finland, Netherlands, Austria and Luxemburg, excluding the weaker Euro members. However, all reports about such plans have been strongly denied. Still, this seems to me like the first step to divide the Eurozone. After all it are those strong countries who don't need common bonds. So to me that sounds like establishing common bonds to keep those six stable no matter what, while the rest, well...

Unbent, Unbowed, Unbroken. Unrelated ME1 Fanfic
Greenmantle V from Greater Wessex, Britannia Since: Feb, 2010 Relationship Status: Hiding
V
#213: Nov 28th 2011 at 4:20:00 AM

OECD warns of European recessionExactly What It Says on the Tin, I'm afraid:

  • Eurozone: Down 1% in the forth quarter, and 0.4% in the first quarter next year
  • UK: 0.03% contraction this quarter, and a further 0.15% in the first quarter next year.
  • Global: Growth revised down to 3.8% this year and 3.4% next year.

And here's the actual OECD article.

And more economic data from The BBC, complete with .xls files of data...

Keep Rolling On
Fighteer Lost in Space from The Time Vortex (Time Abyss) Relationship Status: TV Tropes ruined my love life
Lost in Space
#215: Nov 28th 2011 at 6:35:36 AM

Krugman has something rather pointed to say about the OECD's little about-face... namely that they recommended the very things they are now warning everyone about.

"It's Occam's Shuriken! If the answer is elusive, never rule out ninjas!"
whaleofyournightmare Decemberist from contemplation Since: Jul, 2011
Decemberist
#216: Nov 28th 2011 at 8:38:41 AM

The euro could be days away from collapsing, analysts warned Monday at the start of a critically busy money-raising week for eurozone countries. Markets surged anyway on hopes that European leaders, with their backs to the wall, are readying an overdue solution to the crisis.

In the run-up to the next European summit on Dec. 9, a raft of new ideas circulated on how Europe could once and for all cap the financial contagion that began in Greece two years ago and has now spread to bigger economies, notably Italy.

Among the ideas floated was a plan for the eurozone's six triple A rated nations to pool their resources via a joint bond to provide assistance to some of the single currency bloc's most indebted members and a fast-track move to a fiscal union between the 17 countries that Germany wants in return for its money.

Whatever materializes and however many denials, the euro project is in grave danger.

Evolution Securities economist Gary Jenkins said the series of government bond auctions this week "may determine the future of the EU."

Financial Times columnist Wolfgang Munchau wrote Monday that the common currency "has 10 days at most" to avoid collapse.

The latest bout of turmoil to afflict the eurozone came last week after Germany failed to raise all the money it wanted in a bond auction and Italy had to pay through the roof to get investors to part with their cash.

If a busy bond schedule this week meets with an equally-poor reception, then the euro's countries will be in real danger of being locked out of international markets and facing the devastating prospect of defaulting on their debts.

As governments nervously tap bond markets, Germany looks like it's getting ready to ask its eurozone partners to back measures for a deeper fiscal union.

German Finance Minister Wolfgang Schaeuble said late Sunday that Germany is pushing the EU parliament to allow the 17 eurozone members to draw up treaties that would grant outside powers the right to reject national budgets in eurozone nations that breach EU regulations. Such a move would allow for stiffer new regulations to be enacted more swiftly.

"At the moment, we have a very low level of trust in the eurozone, that is our problem," Schaeuble said in an interview with public broadcaster ARD. "We must now achieve what we failed to 10 years ago through a stability union."

The prospect of a deeper fiscal union, where in effect Berlin will have a greater say on developments in Athens, Rome and Lisbon, has been greeted positively in the markets. But it's likely to take a long time to come to fruition.

"We do seem to be moving slowly towards more of a fiscal union but at a pace that may result in all the components being put in place after a complete meltdown of the financial system," Evolution Securities' Jenkins said.

Many think the ECB is the only institution capable of calming frayed market nerves and German Chancellor Angela Merkel's continued dismissal of a greater ECB role has frayed market nerves.

Potentially, the ECB has unlimited financial firepower through its ability to print money. However, Germany finds the idea of monetizing debts unappealing, warning that it lets the more profligate countries off the hook for their bad practices. In addition, it conjures up bad memories of hyperinflation in Germany in the 1920s.

Source

Oh buggering hell. >.>

Dutch Lesbian
Fighteer Lost in Space from The Time Vortex (Time Abyss) Relationship Status: TV Tropes ruined my love life
Mandemo Since: Apr, 2010
#218: Nov 28th 2011 at 9:01:22 AM

Another thing to note is that with constant stream of bad news, consumers have even less faith on economy, thus continuing the trend and causing even more bad news....

LostAnarchist Violence Is Necessary! from Neo Arcadia Itself Since: Sep, 2011
Violence Is Necessary!
#219: Nov 28th 2011 at 9:09:41 AM

[up] And I thought the US was just a place where Hell on Earth always broke out when it came to the Middle/Working/Lower classes ...

If I want to leave the US, where should I go to live in Europe at the moment? Or should I stick to Canada?

I'd like to know - I don't want to be living in a place where "Austerity is the only way to go at the moment..."

This is where I, the Vampire Mistress, proudly reside: http://liberal.nationstates.net/nation=nova_nacio
Carciofus Is that cake frosting? from Alpha Tucanae I Since: May, 2010
Is that cake frosting?
#220: Nov 28th 2011 at 9:17:56 AM

If I want to leave the US, where should I go to live in Europe at the moment? Or should I stick to Canada?
Scandinavian countries are about as safe a bet as you can get, at the moment.

But they seem to know where they are going, the ones who walk away from Omelas.
LostAnarchist Violence Is Necessary! from Neo Arcadia Itself Since: Sep, 2011
Violence Is Necessary!
#221: Nov 28th 2011 at 9:20:49 AM

[up] So Scandinavia or Canada, then.

I'll keep that in mind before the 2nd Great Depression breaks out. And it will!

This is where I, the Vampire Mistress, proudly reside: http://liberal.nationstates.net/nation=nova_nacio
whaleofyournightmare Decemberist from contemplation Since: Jul, 2011
Decemberist
#222: Nov 28th 2011 at 9:27:19 AM

Eh, Scandinavia is buggered if the Eurozone goes under

Dutch Lesbian
Carciofus Is that cake frosting? from Alpha Tucanae I Since: May, 2010
Is that cake frosting?
#223: Nov 28th 2011 at 9:34:53 AM

Frankly, everything is buggered if the Eurozone goes truly under. Scandinavia is comparatively safe, but yeah.

But they seem to know where they are going, the ones who walk away from Omelas.
LostAnarchist Violence Is Necessary! from Neo Arcadia Itself Since: Sep, 2011
Violence Is Necessary!
#224: Nov 28th 2011 at 9:37:51 AM

[up][up] and [up] Hence why I'm being careful.

But America is secretly on its way to civil war and I'm afraid I'll end up on the wrong side.

Overall, hence why I'm considering vacating the nation for something that will actually look out for me(when I pay my taxes for it, and I do) and appreciate my existence when I fight against it doing something wrong (for the greater good).

edited 28th Nov '11 9:38:37 AM by LostAnarchist

This is where I, the Vampire Mistress, proudly reside: http://liberal.nationstates.net/nation=nova_nacio
BestOf FABRICATI DIEM, PVNC! from Finland Since: Oct, 2010 Relationship Status: Falling within your bell curve
FABRICATI DIEM, PVNC!
#225: Nov 28th 2011 at 9:54:32 AM

Australia isn't out of the question, either - but this is out of the topic, so I'll just stop.

Quod gratis asseritur, gratis negatur.

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