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Sorry, but in which way did Greece not get some 300 billion euros? Whether they first borrowed that money from private banks and then the rest of the eurozone p

Sorry, but in which way did Greece not get some 300 billion euros? Whether they first borrowed that money from private banks and then the rest of the eurozone paid back the banks for Greece or whether they received the money directly from the other eurozone countries, the end result is still that banks now have roughly as much as before (modulo minor interests etc.), Greece has some 300 billion more and the rest of the eurozone has some 300 billion less.

x0x0 11y ago
You're determined to ignore where the money went. German, Dutch, et al banks -- specifically banks that had unacknowledged bad loans to Greece -- have several hundred billion more than before. Public sector balance sheets have that much less.
- claudius 11y ago
  The money from the bailout programme went into the banks, sure. But that only happened because those banks had given out loans to Greece before. I agree that banks made some income from interest rates and also because they bought Greek bonds at lower-than-face value. However, somehow these bonds were still issued by Greece and bought by someone. Where did the money from all these bonds go? To Greece.
  - toyg 11y ago
    No, the banks didn't "make some money" -- they dramatically reduced their exposition to junk bonds at a point in time when that was an existential threats to them. For a number of European banks, that bailout kept them alive. Which is what the bailout was granted in the first place: because European authorities knew it was a bailout for their own banks, who had made terrible decisions in their continuous search for a quick buck.
    - claudius 11y ago
      So junk bonds now just materialise out of nowhere in banks’ books and nobody got money from the bank in the first place? That seems slightly unusual…
      - toyg 11y ago
        Of course it takes two to tango; but if I give you $50 knowing full well that you're never going to repay it, who "deserves" to be punished? Even more so when I know that my $50 will actually be used to buy (weapons|etc) from my friend. In this unjust world, as it happens, "I" was bailed out by the taxpayer community that stepped in and made me whole; however, it's clear that you still can't repay them like you couldn't repay me. What are they supposed to do? One option is enslaving your family for a long time (austerity); another is to just let go and forget about the money, you just won't do business with them anymore (which is what is happening, with the previous Greek elite being slowly kicked out); another still is knocking on my friend's door. Note how this last option is always absent from public discourse. In any case, now I'm free to pontificate on how bad you are and how I shouldn't have given you money in the first place because you're a lazy scumbag, although of course I knew this from day 1. Is that fair?
ZeroGravitas 11y ago
As well as ignoring the banks culpability here, you're doing the same thing the original starter of this thread wanted to point out. Greece is a country, not a person. Did all Greeks benefit equally from that money? Or is large amounts of it sitting in accounts of corrupt politicians and the corporations (not necessarily Greek ones) that the money got spent on. I've seen accusations that the high military spending goes to northern European arms dealing countries. I have no idea if that's true but the pattern is very familiar, the UK have a long history of giving "foreign" "aid" which is basically giving taxpayer money to arms dealers.
- toyg 11y ago
  Some info from 2011: http://www.independent.co.uk/news/business/analysis-and-features/less-healthcare-but-greece-is-still-buying-guns-6257753.html http://www.independent.co.uk/news/business/analysis-and-feat... And again in 2012, it was widely speculated that the bailout was granted on condition that Greece kept up buying stuff from Germany: http://www.theguardian.com/world/2012/apr/19/greece-military-spending-debt-crisis http://www.theguardian.com/world/2012/apr/19/greece-military... And these are the first two google hits, really. Adding a bit of context: Greece basically had a full-out war with Turkey over Cyprus about 40 years ago, and tension has been high ever since. The Cyprus issue is one of the many sticking points that resulted in Turkey being refused EU membership. If you look carefully at maps, you'll see that many Greek islands are extremely close to the Turkish mainland (tourist guides joke that you can get "instant Greece" when visiting Turkey with a quick boat trip). Part of the reconstruction process of Turkish national identity after the end of the Ottomans involved ethnic cleansing against long-time Greek enclaves. This is complicated further by the Cold War and the strategic location of both countries, which means they both "have to be" NATO members by hook or by crook (i.e. the US will never let them go). In this framework, high defence spending is not unnatural; however, reliance on specific northern-European dealers is a bit suspect.
- Djeman 11y ago
  Wait a minute. Isn't Greece a democracy with government responsible to citizens? Greece gov has been spending for decades on military and no one argued with that while credit cards worked.

x0x0 11y ago

You're determined to ignore where the money went. German, Dutch, et al banks -- specifically banks that had unacknowledged bad loans to Greece -- have several hundred billion more than before. Public sector balance sheets have that much less.

claudius 11y ago
The money from the bailout programme went into the banks, sure. But that only happened because those banks had given out loans to Greece before. I agree that banks made some income from interest rates and also because they bought Greek bonds at lower-than-face value. However, somehow these bonds were still issued by Greece and bought by someone. Where did the money from all these bonds go? To Greece.
- toyg 11y ago
  No, the banks didn't "make some money" -- they dramatically reduced their exposition to junk bonds at a point in time when that was an existential threats to them. For a number of European banks, that bailout kept them alive. Which is what the bailout was granted in the first place: because European authorities knew it was a bailout for their own banks, who had made terrible decisions in their continuous search for a quick buck.
  - claudius 11y ago
    So junk bonds now just materialise out of nowhere in banks’ books and nobody got money from the bank in the first place? That seems slightly unusual…
    - toyg 11y ago
      Of course it takes two to tango; but if I give you $50 knowing full well that you're never going to repay it, who "deserves" to be punished? Even more so when I know that my $50 will actually be used to buy (weapons|etc) from my friend. In this unjust world, as it happens, "I" was bailed out by the taxpayer community that stepped in and made me whole; however, it's clear that you still can't repay them like you couldn't repay me. What are they supposed to do? One option is enslaving your family for a long time (austerity); another is to just let go and forget about the money, you just won't do business with them anymore (which is what is happening, with the previous Greek elite being slowly kicked out); another still is knocking on my friend's door. Note how this last option is always absent from public discourse. In any case, now I'm free to pontificate on how bad you are and how I shouldn't have given you money in the first place because you're a lazy scumbag, although of course I knew this from day 1. Is that fair?

ZeroGravitas 11y ago

As well as ignoring the banks culpability here, you're doing the same thing the original starter of this thread wanted to point out. Greece is a country, not a person. Did all Greeks benefit equally from that money? Or is large amounts of it sitting in accounts of corrupt politicians and the corporations (not necessarily Greek ones) that the money got spent on. I've seen accusations that the high military spending goes to northern European arms dealing countries. I have no idea if that's true but the pattern is very familiar, the UK have a long history of giving "foreign" "aid" which is basically giving taxpayer money to arms dealers.

toyg 11y ago
Some info from 2011: http://www.independent.co.uk/news/business/analysis-and-features/less-healthcare-but-greece-is-still-buying-guns-6257753.html http://www.independent.co.uk/news/business/analysis-and-feat... And again in 2012, it was widely speculated that the bailout was granted on condition that Greece kept up buying stuff from Germany: http://www.theguardian.com/world/2012/apr/19/greece-military-spending-debt-crisis http://www.theguardian.com/world/2012/apr/19/greece-military... And these are the first two google hits, really. Adding a bit of context: Greece basically had a full-out war with Turkey over Cyprus about 40 years ago, and tension has been high ever since. The Cyprus issue is one of the many sticking points that resulted in Turkey being refused EU membership. If you look carefully at maps, you'll see that many Greek islands are extremely close to the Turkish mainland (tourist guides joke that you can get "instant Greece" when visiting Turkey with a quick boat trip). Part of the reconstruction process of Turkish national identity after the end of the Ottomans involved ethnic cleansing against long-time Greek enclaves. This is complicated further by the Cold War and the strategic location of both countries, which means they both "have to be" NATO members by hook or by crook (i.e. the US will never let them go). In this framework, high defence spending is not unnatural; however, reliance on specific northern-European dealers is a bit suspect.
Djeman 11y ago
Wait a minute. Isn't Greece a democracy with government responsible to citizens? Greece gov has been spending for decades on military and no one argued with that while credit cards worked.