Wednesday, Jul 28, 2010
Don't worry about your debts
Reuters: Greece passes law to relieve debt-stricken households
The law does not specify what percentage of the loan can be forgiven but stipulates that debtors must provide proof that they are unable to fully repay their debt by liquidating assets.
Posted by crash n burn @ 04:38 PM (1455 views) Add Comment
12 Comments
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1. Whispers said...
I wonder what the German taxpayer will think when they read this article...
2. rumble said...
Bailouts
Irresponsibility
Humiliation
3. Wageslavex14 said...
To be honest, I think similar write-offs are the only fair way out of this mess for most countries with large private debts (i.e. inc the UK) - much fairer than stoking inflation.
It has to be done in parallel with allowing asset prices to deflate, however, and it would be difficult to set up a system which wasn't open to fraud.
The tuppenceworth.
4. This comment has been removed as it was found to be in breach of our Blog Policies.
5. ianbe said...
It's hardly "relief" if the debtor has to forfiet their assets.
6. paul said...
The law enables borrowers to avoid foreclosure on their primary residence -- committing to pay back debts at an average mortgage rate over a maximum period of 20 years for amounts up to 85 percent of their property's commercial value.
And renters can just shuddup and keep paying their rent.
7. This comment has been removed as it was found to be in breach of our Blog Policies.
8. titaniccaptain said...
Nice find Crash n Burn!
Is this the first hint at a debt jubilee? (Not really needed if inflation erodes debt) or another rearrangement of the words At, Straws and Clutching?
By the way for those who may be interested (Completely nothing HPC related so I apologise in advance) there is this :-
http://www.bbc.co.uk/programmes/b00t67cm
2 hours 21 mins and 28 seconds in my band is playing with the Chris (The singer/songwriter) interviewed (myself on bass and accordion on the first song and bass on the second which is at the end of the interview....oh and I produced, arranged, engineered and mixed the music under my stairs........aren't I a clever and humble chap?)
If you like Dylan, Neil young , Mr J Cash then you may like this.......its roots unpolished real music.....even the warts are left in.
Hope you enjoy.....sorry to those that may find this off topic and self promoting (I am not promoting.....we have enough media interest to deal with) this is just for a few friends of mine on this site.
9. yorkshireman said...
Who decides on the commercial value of the property ? Could turn out to be a double edged sword.
10. uncle tom said...
If I understand this correctly, the Greek government is proposing to use EU bailout funds to forgive loans made to Greek citizens.
Hmm..
The Germans REALLY won't like this..
11. jack c said...
Seems similar to re-arranging the deckchairs on the Titanic to me
12. nickb said...
It may be good to relieve people of their debts if it prevents a generalised debt deflation. Economist Richard Douthwaite is arguing precisely this in relation to Irish debts. However, the Greek approach doesn't seem sensible becuase of moral hazard - who is going to admit they have assets they can liquidate? This will make the means testing tricky and expensive. In addition, savers are not compensated for possible inflation nor are they rewarded for prudence. Douthwaite's proposal would see vouchers handed out universally for debt relief which could be cashed by those who are not in debt. Yes, it's Bernanke's helicopters, but what is the alternative - if he is right about a serious debt deflation otherwise?