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This post has no connection with reality, I have no clue why it's upvoted. a) Regarding the state accounting fraud: first of all, using the past tense ("was")

This post has no connection with reality, I have no clue why it's upvoted. a) Regarding the state accounting fraud: first of all, using the past tense ("was") is misleading. As of last year, Greece was still cooking its books[0]. It remains to be seen if they have actually stopped. You say the difference was minimal. When? When they brought in Georgiou to fix the Greek statistics service, the 2009 deficit was revised from 3.7% to 15.8%. The reaction of the government? Prosecute the guy because he refused to continue lying.[1] b) You say banks correctly assumed they would get their money. This is nonsense. The banks lost nearly 80% of the value of their loans in the "PSI".[2] The word you're looking for is "incorrectly". They screwed up and paid dearly for it. c) Pure nonsense. I have no clue where you're getting that from but it doesn't even deserve a response. d) The troika has zero power when it comes to "ruling" Greece. How do you think Greece has been able to completely avoid structural reforms and pro-growth measures for 5 years now, if the troika is ruling the country? Almost none of the reforms the troika asked for in exchange for the loans have been implemented. [0] yanisvaroufakis.eu/2014/04/24/greek-statistics-are-back-primary-deficit-presented-as-surplus-with-eurostats-seal-of-approval/ [1] http://www.spiegel.de/international/europe/chief-greek-statistician-charged-for-revealing-true-size-of-debt-a-882942.html http://www.spiegel.de/international/europe/chief-greek-stati... [2] http://en.wikipedia.org/wiki/Private_sector_involvement http://en.wikipedia.org/wiki/Private_sector_involvement

bsaul 12y ago
Thanks for bringing a bit of reality check to the previous poster. Now i would disagree a bit with you on d) : The only power the troika had was that the greek government needed to get regular loans to repay part of the interests of their huge debt and the salaries of the greek state workers. That did give the troika the power to keep a bit of pressure on the greek government and ensure it will keep reforming the country a bit. And the reforms started to work, because now the greek budget is balanced enough for the state to be able to pay their workers without the need for additional loans from the EU. Unfortunately, it means now that the greeks can effectively say FU to the european troika if they plan on stopping to repay their debt, without risking an internal chaos. The only persons that will effectively have a hole in their budget as a result are the other EU states (states and not banks, meaning citizens), mostly french and germans.
afterburner 12y ago
Your response is hyperbolic. I also think you seem to have misunderstood (c), which is simply stating what has happened: 1) most debt are owed to French and German banks, and in order to pay them 2) the country prioritized these repayments over all else which 3) tanked the Greek economy and made all this private debt the taxpayer's problem; 4) 250b is the amount Greece received and its government financed are about 20b. d) the troika seems to have the power to destroy the Greek economy by demanding repayments, which until now has worked because the Greek government itself did as the troika demanded. If that's not power I don't know what is. It's certainly not "zero" power.
BSousa 12y ago
Ok, let me go point by point a) you are right. I was only referring to the pre-euro accounting. Sorry if I didn't make myself clear. b+c) I don't know the exact figure, but if I remember correctly, private loses were about 20% only. "One estimate is that Greece actually subscribed to €156bn worth of new debt in order to get €206bn worth of old debt to be written off, meaning the trumpeted write-down of €110bn by the banks and others is more than double the true figure of €50bn that was truly written off. Taxpayers are now liable for more than 80% of Greece's debt.[219] James Mackintosh, Investment Editor at the Financial Times, noted a JPMorgan Chase estimate that "only €15bn of €410bn total 'aid' to Greece" actually went into the country's economy, the rest having been handed over to its creditors. " [1] d) Yes, they can't 'force' any government to do as they say, but if they don't, they don't give them the money they need. They aren't open to negotiating at all. They want the gov. to sell profitable businesses and to reduce social spending. That is their 'sensible' way to deal with the issue. I don't have first hand experience of what they did in Greece, but if what they tried to do in Portugal is any indication, it was a loser's game from the start. They didn't care about economic recovery or sustainable growth. No, they were repo men trying to get as much of the money back as possible. Which is fine, it's their job and the countries accepted the money, but then, not for one second please tell me how these countries are lazy and spenders, and the damn hard worker Northern brethren has to act like a parent. Let's not forget Germany were one of the first countries to go over the 3% deficit target and got scot free through political pressure [2] [3] [1] http://en.wikipedia.org/wiki/Greek_government-debt_crisis#Analysis_of_the_restructuring http://en.wikipedia.org/wiki/Greek_government-debt_crisis#An... [2] http://www.theguardian.com/business/2003/nov/25/theeuro.politics http://www.theguardian.com/business/2003/nov/25/theeuro.poli... - sorry, its the guardian, but you can google other sources [3] http://en.wikipedia.org/wiki/Stability_and_Growth_Pact#Reform_2005 http://en.wikipedia.org/wiki/Stability_and_Growth_Pact#Refor...
- galfarragem 12y ago
  Would you be happy if the your country lend them your taxes money, knowing that they decide the loan terms, not knowing when and if they will pay you back? I wouldnt.
  - 12y ago

bsaul 12y ago

Thanks for bringing a bit of reality check to the previous poster. Now i would disagree a bit with you on d) : The only power the troika had was that the greek government needed to get regular loans to repay part of the interests of their huge debt and the salaries of the greek state workers. That did give the troika the power to keep a bit of pressure on the greek government and ensure it will keep reforming the country a bit. And the reforms started to work, because now the greek budget is balanced enough for the state to be able to pay their workers without the need for additional loans from the EU. Unfortunately, it means now that the greeks can effectively say FU to the european troika if they plan on stopping to repay their debt, without risking an internal chaos. The only persons that will effectively have a hole in their budget as a result are the other EU states (states and not banks, meaning citizens), mostly french and germans.

afterburner 12y ago

Your response is hyperbolic. I also think you seem to have misunderstood (c), which is simply stating what has happened: 1) most debt are owed to French and German banks, and in order to pay them 2) the country prioritized these repayments over all else which 3) tanked the Greek economy and made all this private debt the taxpayer's problem; 4) 250b is the amount Greece received and its government financed are about 20b. d) the troika seems to have the power to destroy the Greek economy by demanding repayments, which until now has worked because the Greek government itself did as the troika demanded. If that's not power I don't know what is. It's certainly not "zero" power.

BSousa 12y ago

Ok, let me go point by point a) you are right. I was only referring to the pre-euro accounting. Sorry if I didn't make myself clear. b+c) I don't know the exact figure, but if I remember correctly, private loses were about 20% only. "One estimate is that Greece actually subscribed to €156bn worth of new debt in order to get €206bn worth of old debt to be written off, meaning the trumpeted write-down of €110bn by the banks and others is more than double the true figure of €50bn that was truly written off. Taxpayers are now liable for more than 80% of Greece's debt.[219] James Mackintosh, Investment Editor at the Financial Times, noted a JPMorgan Chase estimate that "only €15bn of €410bn total 'aid' to Greece" actually went into the country's economy, the rest having been handed over to its creditors. " [1] d) Yes, they can't 'force' any government to do as they say, but if they don't, they don't give them the money they need. They aren't open to negotiating at all. They want the gov. to sell profitable businesses and to reduce social spending. That is their 'sensible' way to deal with the issue. I don't have first hand experience of what they did in Greece, but if what they tried to do in Portugal is any indication, it was a loser's game from the start. They didn't care about economic recovery or sustainable growth. No, they were repo men trying to get as much of the money back as possible. Which is fine, it's their job and the countries accepted the money, but then, not for one second please tell me how these countries are lazy and spenders, and the damn hard worker Northern brethren has to act like a parent. Let's not forget Germany were one of the first countries to go over the 3% deficit target and got scot free through political pressure [2] [3] [1] http://en.wikipedia.org/wiki/Greek_government-debt_crisis#Analysis_of_the_restructuring http://en.wikipedia.org/wiki/Greek_government-debt_crisis#An... [2] http://www.theguardian.com/business/2003/nov/25/theeuro.politics http://www.theguardian.com/business/2003/nov/25/theeuro.poli... - sorry, its the guardian, but you can google other sources [3] http://en.wikipedia.org/wiki/Stability_and_Growth_Pact#Reform_2005 http://en.wikipedia.org/wiki/Stability_and_Growth_Pact#Refor...

galfarragem 12y ago
Would you be happy if the your country lend them your taxes money, knowing that they decide the loan terms, not knowing when and if they will pay you back? I wouldnt.
- 12y ago