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View Diary: If the Euro fails. (282 comments)

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  •  This Is Dumbing It Down (12+ / 0-)

    but really France and Germany have to step in with hundreds of billions. Neither nation really wants to do it. But you are looking at four nations that are in serious, series trouble. Italy. Greece. Spain. Portugal. They are called PIGS in the financial press. I catch a lot of news when I listen to the BBC feed on my NPR station and the situation is, well pretty bad.

    Just ponder this for a few seconds. Lets say Greece pulls out of the EU. They then literally have no currency to use. Ponder what that would mean. I think it is safe to say riots like we've never seen before.

    When opportunity calls pick up the phone and give it directions to your house.

    by webranding on Sun Nov 27, 2011 at 08:06:10 AM PST

    [ Parent ]

    •  This will sound like a naive question (5+ / 0-)

      because really it is, but before the integration of these nations' individual monetary systems into the use of the Euro, how did they maintain stability?

      I can't imagine the riots, to be honest.

    •  Greece should pull out (7+ / 0-)
      Recommended by:
      LynChi, DRo, G2geek, Cliss, Odysseus, Cat Servant, Losty

      as should the other countries that owe banks more than they can pay. It was predatory lending in the first place, now the banks don't want to take their losses on making bad loans. But Greece shouldn't make that their problem. They should just default.

      Greece can issue its own currency, or the people can develop one. People with goods to trade soon come up with a form of currency or a method of trading. The Greek people will be better off, and the government needs to support the people as best it can and not worry about foreign banks.

      working for a world that works for everyone ...

      by USHomeopath on Sun Nov 27, 2011 at 12:19:03 PM PST

      [ Parent ]

    •  French and German elites were the engine (8+ / 0-)

      behind the Euro. They failed to protect their economies and the rest of Europe from the technocrats and banksters. This is another needless disaster that many clear eyed critics warned about 20 years ago.  

      The march over the last 30 yrs to put control of the world economy into the control of fewer and fewer players, while making the financial system more complex and vulnerable to graft, is collapsing the whole system onto the rest of us.

      Goldman Sachs alums are the PMs of Greece and Italy and the ECB is in their hands. These elites will be able to find safe havens for years while other Europeans lose everything.

      We're all on the menu.  

      •  What price the new democracy? Goldman conquers (7+ / 0-)

        What price the new democracy? Goldman Sachs conquers Europe

        ...This is the most remarkable thing of all: a giant leap forward for, or perhaps even the successful culmination of, the Goldman Sachs Project.

        It is not just Mr Monti. The European Central Bank, another crucial player in the sovereign debt drama, is under ex-Goldman management, and the investment bank's alumni hold sway in the corridors of power in almost every European nation, as they have done in the US throughout the financial crisis. Until Wednesday, the International Monetary Fund's European division was also run by a Goldman man, Antonio Borges, who just resigned for personal reasons.

        Even before the upheaval in Italy, there was no sign of Goldman Sachs living down its nickname as "the Vampire Squid", and now that its tentacles reach to the top of the eurozone, sceptical voices are raising questions over its influence. The political decisions taken in the coming weeks will determine if the eurozone can and will pay its debts – and Goldman's interests are intricately tied up with the answer to that question.

        Simon Johnson, the former International Monetary Fund economist, in his book 13 Bankers, argued that Goldman Sachs and the other large banks had become so close to government in the run-up to the financial crisis that the US was effectively an oligarchy. At least European politicians aren't "bought and paid for" by corporations, as in the US, he says. "Instead what you have in Europe is a shared world-view among the policy elite and the bankers, a shared set of goals and mutual reinforcement of illusions."

        •  Goldman (2+ / 0-)
          Recommended by:
          Grabber by the Heel, Creosote

          has been maneuvering throughout this slow-mo implosion like Nijinsky dancing to Mussorgsky
          they got bailed out in Greece, Spain etc while their bonds were still worth plenty, now they're poised to move back in for the kill...

        •   Shared Illusions by Financial Elites (2+ / 0-)
          Recommended by:
          reset, mrsgoo

          Are just as dangerous as greedy bankers and corrupt politicians. The book Lords of Finance comes to mind. Strong and the heads of the European banks in the 1920s seemed to be patriotic and honest men sensitive to the need not to plunge the world into crisis, and yet they helped produce the Depression and the 2nd WWII. Our generation of banksters, who prize recklessness and wealth beyond anything, could make the calamity these bankers in the 1920s produced with their ernest incompetence, seem like a mild recession with a football riot.    

          •  Yes, yes! (1+ / 0-)
            Recommended by:
            reset

            They never rush and any swift move is followed by what seems like a quiet interlude. But every time there is a loud crash in the world economy goldman has been there and gone. They have been moves ahead before most of the world knew the music started.

    •  German Pope, Italian Central Banker (3+ / 0-)
      Recommended by:
      DRo, mrsgoo, Creosote

      If you want an understanding of the Debt Crisis in Europe start here:

      Watch this BBC interview first and then read this analysis:

      German Pope, Italian Central Banker

      He made two crucial points – points that stock market investors are ignoring. First, over the last nine years, there has been an increase of world debt from $80 trillion to $210 trillion. These numbers are staggering. Global debt over the last nine years has grown at 12% per year, while GDP has grown at 4% per year.

      While he did not verbally spell out the conclusion for the interviewer, it is this: when credit must grow by 12% per year in order to produce 4% GDP growth, at some point there will not be enough GDP to supply sufficient credit.

      It is time once again to quote economist Herb Stein: "When something cannot go on forever, it has a tendency to stop."

      MORAL HAZARD
      ...Those who made the risky bets have diverted the risk to others: taxpayers or the general public who holds currency. The gains from the bets are private, and theirs to keep, but all the losses are distributed to the public via government bailouts or money-printing. The first shifts the losses to the taxpayer, and the second shifts the losses to everyone holding the currency being devalued.

      ...Not only has the risk been palmed off onto unsuspecting chumps, the returns have been concentrated into the few hands that control the big bets. This is the ideal setup for the stupendous gains and zero risk that characterize crony-capitalism: make the big bets with leverage and borrowed money, and skim the vast profits. Then when the bets sour, demand a bailout from the Central State, the ECB, the Fed, etc., which promptly socializes the losses and distributes them over the entire populace of taxpayers or holders of currency.

      'If those who made the bets for their own private gain aren't forced to absorb the risk, then we don't live in either capitalism or democracy; we live in a financial-fascist tyranny.'

    •  Merkel is looking more like Nero every day. (1+ / 0-)
      Recommended by:
      mrsgoo

      Fiddling while the Euro burns....

      Germany is curling its collective lip in contempt at those inferior southern Europeans, disgusted by their profligacy, their wanton 'grasshopper' economies compared to the stern and diligent Teutonic 'ant' economy.

      Thing is, Greece/Portugal/Italy/Spain are going over the cliff....while still chained to Germany by the Euro.

      I believe there's nothing Germany or France can do at this point to salvage this clusterfuck. That door was shut the moment the "PIGS" nations adopted suicidal austerity policies that guaranteed accelerating economic contraction.

      It's mind-boggling to me that so many notionally smart people learned absolutely nothing from the lessons of the Great Depression.

      •  It's already too late (0+ / 0-)

        They have driven up the costs of the crisis to the point where nothing short of a gigantic eurobond will save them.

        There are two kinds of people in this world. The kind who divide the world into two kinds of people, and the kind who don't.

        by upstate NY on Mon Nov 28, 2011 at 11:26:23 AM PST

        [ Parent ]

    •  webranding (0+ / 0-)

      My favorite part of listening to NPR is the BBC news.  I end up having more information and much sooner than it hits the US media.  It actually has encouraged me to be better informed on the world news.  It has broadened my understanding of the interconnections between the US and the rest of the world.  Thanks for your simple explanations here.  Helps someone like myself that is just starting to understand some of this, and makes it easier for me to spread the word to friends.

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