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My Big Fat Greek Deficit

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It will be interesting to see how long the EU will bail them out. My understanding is the original bailout was 180 billion Euros, and the more recent one 90 billion Euros.

So a total of 270 billion Euros for a nation of 11.3 million. That is 24,000 Euros per citizen so far, and they are still burning through at the same rate.

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There's only one way where Greece is heading; and I'm afraid its to the dogs. A wonderful place, but sadly a slow malaise, a creeping sense of entitlement has reached a point where it has almost destroyed them.

They (and we) are owed nothing (incl. benefits / pensions / education / defence / health care) unless we can afford it. When will their and our idiots get this into their skulls.

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There's only one way where Greece is heading; and I'm afraid its to the dogs. A wonderful place, but sadly a slow malaise, a creeping sense of entitlement has reached a point where it has almost destroyed them.

They (and we) are owed nothing (incl. benefits / pensions / education / defence / health care) unless we can afford it. When will their and our idiots get this into their skulls.

Reading history it seems people only get it when the cheques bounce. Until that point they keep spending and giving each other generous salary increases and pension promises out of the public treasury.

Interestingly Greece actually hit that point over a year ago. But now the EU central bank is making sure the cheques still clear. So Greece is going right on spending.

Entitlement is hard to break.. for example argue with any Brit that their own publicly funded pension is excessive. In my entire life I've only met one person who argued against his own pension. My own grandfather.

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http://www.telegraph.co.uk/finance/economics/gilts/8474725/Hole-in-Greek-finances-bigger-than-thought-as-bond-flight-continues.html

'The deficit in the Greek government's budget amounted to 10.5pc of GDP in 2010, EU statistics agency Eurostat reported on Tuesday, putting it significantly above February's 9.6pc estimate from Brussels.

The continued flight from Greek sovereign debt pushed the yield, or return, on the 10-year government bonds to new highs of 15.5pc.

The European Central Bank, the only major potential buyer, "won't buy whilst [some eurozone countries such as Germany] continue to speak and put pressure on Greece to restructure", said one trader.

Despite denials from Greek and EU officials, the pricing of credit default swaps - instruments that insure the debt - signalled a 66pc chance of Greece defaulting within five years, according to data tracker CMA.

Jose Manuel Gonzalez-Paramo, a member of the European Central Bank's executive board, warned on Tuesday a restructure would be "quite likely more devastating" than the fall of investment bank Lehman Brothers, which precipitated the financial crisis.

Portugal also disappointed as Eurostat confirmed the figure out from Lisbon at the weekend that upped its 2010 deficit to 9.1pc of GDP, compared to earlier estimates it hwill it its 7.3pc target for the year. '

can't imagine there's many a HPCer surprised at the news.I can't see them lasting to 2015.Jose surely gets a prize for stating the obvious.

Seems pretty clear Greece is not going to pay back the money owed. Same deal for Portugal, Probably Ireland, Spain and maybe Italy.

The banks who were buying Greek bonds at a tiny margin over German ones are as much to blame as the Greek population. They should never have been lent the money in the first place.

The Greek population is now suffering badly, retail sales for February out on Friday should be interesting. The economy seems to be in a debt spiral I expect the economy to shrink more, especially when another €25b of austerity is announced this week.

Seems like a Greek debt version of Versailles where the "victors" refuse to take any responsibility for their banks and pile misery on the "defeated" Greeks. No doubt Greece will collapse eventually just like Weimar Germany.

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Seems pretty clear Greece is not going to pay back the money owed. Same deal for Portugal, Probably Ireland, Spain and maybe Italy.

The banks who were buying Greek bonds at a tiny margin over German ones are as much to blame as the Greek population. They should never have been lent the money in the first place.

The Greek population is now suffering badly, retail sales for February out on Friday should be interesting. The economy seems to be in a debt spiral I expect the economy to shrink more, especially when another €25b of austerity is announced this week.

Seems like a Greek debt version of Versailles where the "victors" refuse to take any responsibility for their banks and pile misery on the "defeated" Greeks. No doubt Greece will collapse eventually just like Weimar Germany.

Yes the banks made a bad bet. Betting tremendous amounts of money on the long term fiscal health of Greece and friends.. and getting only a tiny spread above German bonds for it. Of course the reason the spread was so small is that banks can use basically infinite leverage. So any bond that has a higher spread in good times than the lowest one they will leverage up and grab all the bonds they can. Playing the spread. And other banks from many other nations have the same idea.

When it blows up it is catastrophic. Because the spread they were getting is so tiny they have built little capital. And when you leverage 20 or 30 times there is no way you can cover losses if you face a complete loss on even a few.

Its part of the problem of fractional reserve banking with these banks making loans with money they don't have. It leads to runaway bubbles in asset prices on the way up, then the financial system imploding on the way down.

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  • 312 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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