9 ms·

Newbie here. It seems that the result is a solid NO. What are the implications? Spain and Portugal will be the next to fall?

raesene9 11y ago
If you believe the various European governments, contagion risk is small, so it's not likely to hit Spain, Portugal et al. As the ECB can provide liquidity to European banks that are not insolvent (as it has been for Greece) they can stop bank runs from causing an issue in the short term at least. What Greece's future is, from what I can see, far less certain. The Greeks state that they will now get a quick agreement, but that seems unlikely. Any new bailout agreement would need to be ratified in 18 parliaments (the Eurozone) and in several of those the mood to accept the kind of deal Greece wants seems lacking. As such it seems there will be an extended negotiation, which wouldn't be a huge issue except for the fact that Greece's banks are currently insolvent and without ECB funding don't appear to have any route back to solvency without leaving the Euro. There may be some kind of political solution to that quandry but I have a feeling it will not be as certain and easy a path as the Greek government have currently stated.
condescendence 11y ago
Not necessarily, Greece in itself is a very interesting situation. Almost half of their entire countries' GDP was generated by a single city before 2011. [1][2]second link is a decent read about individual municipalities going down slowly within Attica I claim that the steady decline of economics in that city, which might have had something to do with the Fascism rise with the Golden Dawn political party, destroyed their overall economy. [3] Many foreign workers who made up a decent amount of the manual labor jobs in that city left in fear, meanwhile Greeks couldn't fit these jobs because of the lackluster pay and poisonous political/economic climate at that time. [1]http://www.ansamed.info/ansamed/en/news/sections/economics/2014/06/23/greece-attica-hardly-hit-from-the-6-year-economic-crisis_679f4107-220c-4464-8b53-42086733326e.html http://www.ansamed.info/ansamed/en/news/sections/economics/2... [2]http://www.keeptalkinggreece.com/2012/09/21/greek-municipality-suspends-operation-due-to-economic-problems/ http://www.keeptalkinggreece.com/2012/09/21/greek-municipali... [3]http://blogs.aljazeera.com/blog/europe/high-police-support-greeces-golden-dawn http://blogs.aljazeera.com/blog/europe/high-police-support-g...
tptacek 11y ago
To what extent does Spain's political system manage its civil service as a spoils system for the benefit of party supporters? Greece apparently invented entire departments to pay party members. To what extent do Spain's entitlement obligations (health care, retirement, &c) track its economy? Greece apparently provides Scandinavian-grade benefits on Alabama-grade revenues. To what extent was Spain's accession to the EU exploited as a bonanza for foreign banks? Greece's debt is apparently the product of a ratings arbitrage scheme that occurred when its speculator-grade sovereign debt suddenly became backstopped by the ECB. To what extent do Spain's citizens buy into the financial philosophy of the EU? Greece has massive self-employment, a thriving undocumented market, and pitiful revenue collection. For decades, Greece has "financed" itself with stated revenue preferences (high tax rates) that do not meaningfully track revealed revenue preferences (low tax collection and enforcement).
- bjourne 11y ago
  > To what extent do Spain's entitlement obligations (health care, retirement, &c) track its economy? Greece apparently provides Scandinavian-grade benefits on Alabama-grade revenues. The situation about Greece is mired with propaganda and media tells us that Greeks just want to lay on beach, never work and retire when they are 50. I've heard so many parrot that because they read it in a magazine and it is not true. Greeks work the most hours in the EU and their retirement age is higher: http://www.newstatesman.com/blogs/world-affairs/2012/05/exploding-myth-feckless-lazy-greeks http://www.newstatesman.com/blogs/world-affairs/2012/05/expl... So there is no reason to believe that "Greece apparently provides Scandinavian-grade benefits on Alabama-grade revenues" is true if it is not backed up by stats proving it to be true.
  - tptacek 11y ago
    You've refuted a statistic I didn't provide. The full retirement age in the US in 66 (soon to be 67). The average retirement age in Greece is 61. 17.5% of Greece's GDP goes to retirement spending. US public retirement insurance is 5% of GDP. The comparison I made isn't "lazy" versus "industrious". It's "revenue vs. spending", using the USA and Scandinavia as anchors for comparison. Greek revenue is more like USA revenue than Swedish revenue. Greek spending is more like Swedish spending (Swedish retirement age: 65) than like USA spending. I'm trying not to make value judgements. I don't believe that the Greeks are lazy and sitting on beaches. It does, however, appear that their fiscal policy is mismanaged.
rurban 11y ago
In Spain the Syriza friendly Podemus is already in the lead, but they need to wait for the next elections, to re-evaluate their payment terms. In Portugal the Syriza-friendly PS will win in October. While the right wing extremists, Germany, but also the EU officials Juncker, Draghi, Lagarde, Djiselbloem, Schulz, Schaeuble, Merkel and their press corps are still violently trash talking and lying about Syriza, effectively burying the EU. Everyone knows that they are wrong and lost face. They were all caught lying and doing too much damage with our economy and the EU project. Syriza is their best chance to get Greece implement the necessary reforms in the next 10-20 years. The established Greek parties caused the situation and Syriza is their best chance to turn it around. They are also the ones who are not lying. Germany got to backup the defaulting EMS fonds which will hurt them. A lot. Why they are still not trying to save them is beyond my understanding. Greece could try to talk them to senses, because they have the numbers, the morale and the people behind them, but it does not look like so. So effectively all the next european elections will be won by the left, and Goldmann-Sachs (Draghi) & IMF will have it much harder than now. Which is good. Even Germany is not following their own austerity measures. They cheat over France by going on with their low-wage policies and they cheated over the inflation caps.

raesene9 11y ago

If you believe the various European governments, contagion risk is small, so it's not likely to hit Spain, Portugal et al. As the ECB can provide liquidity to European banks that are not insolvent (as it has been for Greece) they can stop bank runs from causing an issue in the short term at least. What Greece's future is, from what I can see, far less certain. The Greeks state that they will now get a quick agreement, but that seems unlikely. Any new bailout agreement would need to be ratified in 18 parliaments (the Eurozone) and in several of those the mood to accept the kind of deal Greece wants seems lacking. As such it seems there will be an extended negotiation, which wouldn't be a huge issue except for the fact that Greece's banks are currently insolvent and without ECB funding don't appear to have any route back to solvency without leaving the Euro. There may be some kind of political solution to that quandry but I have a feeling it will not be as certain and easy a path as the Greek government have currently stated.

condescendence 11y ago

Not necessarily, Greece in itself is a very interesting situation. Almost half of their entire countries' GDP was generated by a single city before 2011. [1][2]second link is a decent read about individual municipalities going down slowly within Attica I claim that the steady decline of economics in that city, which might have had something to do with the Fascism rise with the Golden Dawn political party, destroyed their overall economy. [3] Many foreign workers who made up a decent amount of the manual labor jobs in that city left in fear, meanwhile Greeks couldn't fit these jobs because of the lackluster pay and poisonous political/economic climate at that time. [1]http://www.ansamed.info/ansamed/en/news/sections/economics/2014/06/23/greece-attica-hardly-hit-from-the-6-year-economic-crisis_679f4107-220c-4464-8b53-42086733326e.html http://www.ansamed.info/ansamed/en/news/sections/economics/2... [2]http://www.keeptalkinggreece.com/2012/09/21/greek-municipality-suspends-operation-due-to-economic-problems/ http://www.keeptalkinggreece.com/2012/09/21/greek-municipali... [3]http://blogs.aljazeera.com/blog/europe/high-police-support-greeces-golden-dawn http://blogs.aljazeera.com/blog/europe/high-police-support-g...

tptacek 11y ago

To what extent does Spain's political system manage its civil service as a spoils system for the benefit of party supporters? Greece apparently invented entire departments to pay party members. To what extent do Spain's entitlement obligations (health care, retirement, &c) track its economy? Greece apparently provides Scandinavian-grade benefits on Alabama-grade revenues. To what extent was Spain's accession to the EU exploited as a bonanza for foreign banks? Greece's debt is apparently the product of a ratings arbitrage scheme that occurred when its speculator-grade sovereign debt suddenly became backstopped by the ECB. To what extent do Spain's citizens buy into the financial philosophy of the EU? Greece has massive self-employment, a thriving undocumented market, and pitiful revenue collection. For decades, Greece has "financed" itself with stated revenue preferences (high tax rates) that do not meaningfully track revealed revenue preferences (low tax collection and enforcement).

bjourne 11y ago
> To what extent do Spain's entitlement obligations (health care, retirement, &c) track its economy? Greece apparently provides Scandinavian-grade benefits on Alabama-grade revenues. The situation about Greece is mired with propaganda and media tells us that Greeks just want to lay on beach, never work and retire when they are 50. I've heard so many parrot that because they read it in a magazine and it is not true. Greeks work the most hours in the EU and their retirement age is higher: http://www.newstatesman.com/blogs/world-affairs/2012/05/exploding-myth-feckless-lazy-greeks http://www.newstatesman.com/blogs/world-affairs/2012/05/expl... So there is no reason to believe that "Greece apparently provides Scandinavian-grade benefits on Alabama-grade revenues" is true if it is not backed up by stats proving it to be true.
- tptacek 11y ago
  You've refuted a statistic I didn't provide. The full retirement age in the US in 66 (soon to be 67). The average retirement age in Greece is 61. 17.5% of Greece's GDP goes to retirement spending. US public retirement insurance is 5% of GDP. The comparison I made isn't "lazy" versus "industrious". It's "revenue vs. spending", using the USA and Scandinavia as anchors for comparison. Greek revenue is more like USA revenue than Swedish revenue. Greek spending is more like Swedish spending (Swedish retirement age: 65) than like USA spending. I'm trying not to make value judgements. I don't believe that the Greeks are lazy and sitting on beaches. It does, however, appear that their fiscal policy is mismanaged.

rurban 11y ago

In Spain the Syriza friendly Podemus is already in the lead, but they need to wait for the next elections, to re-evaluate their payment terms. In Portugal the Syriza-friendly PS will win in October. While the right wing extremists, Germany, but also the EU officials Juncker, Draghi, Lagarde, Djiselbloem, Schulz, Schaeuble, Merkel and their press corps are still violently trash talking and lying about Syriza, effectively burying the EU. Everyone knows that they are wrong and lost face. They were all caught lying and doing too much damage with our economy and the EU project. Syriza is their best chance to get Greece implement the necessary reforms in the next 10-20 years. The established Greek parties caused the situation and Syriza is their best chance to turn it around. They are also the ones who are not lying. Germany got to backup the defaulting EMS fonds which will hurt them. A lot. Why they are still not trying to save them is beyond my understanding. Greece could try to talk them to senses, because they have the numbers, the morale and the people behind them, but it does not look like so. So effectively all the next european elections will be won by the left, and Goldmann-Sachs (Draghi) & IMF will have it much harder than now. Which is good. Even Germany is not following their own austerity measures. They cheat over France by going on with their low-wage policies and they cheated over the inflation caps.