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Sovereign Debt Jubilee

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This is from Golem XIV - there's some decent debate in the comments as well:

Professor Evans said what he and his colleagues found "was astounding".

  • The countries can reduce their total debt by 64% through cross cancellation of interlinked debt, taking total debt from 40.47% of GDP to 14.58%
  • Six countries – Ireland, Italy, Spain, Britain, France and Germany – can write off more than 50% of their outstanding debt
  • Ireland can reduce its debt from almost 130% of GDP to under 20% of GDP
  • France can virtually eliminate its debt – reducing it to just 0.06% of GDP

Among the 'debtor' nations a Debt Jubilee means Ireland reduces its debt load to from 130% of GDP to under 20%! That would virtually wipe out the crippling cuts being forced upon the Irish. While even among the 'Creditor' nations France benefits by nearly eliminating its debt. So the French people too would benefit. Which does beg the question - who is benefiting by enforcing all the debts? I'll give you one guess.

Which brings us back to the reason there has been no discussion at all of a Debt Jubilee. Keeping the debts is going to profit the banks and their bond holders. Not only that, but making sure there is no discussion of mutual debt cancellation, and thereby keeping sovereign debt levels as high as possible, gives those on the political Right, the perfect crowbar they have wished for but never had, for forcing through a political agenda of privatizing and destroying the social fabric of welfare. An agenda for which they never quite got a mandate through the ballot box.

That is why the debts are being maintained and why there has been no discussion of any alternative. Our politicians are 'protecting' the debts and those whose will profit from their payment over and above the welfare of the people they are supposed to serve.

The bankers don't want any discussion of mutual debt cross cancellation because it would force a necessary deleveraging. The bankers do not want deleveraging because leverage is the secret of how the bankers make their profits and without it they wouldn't look nearly so smart. The reason debt cancellation would force deleveraging is because much of the debt which would be cancelled is currently being held on bank books as an 'asset' serving to underpin yet more loans and debt. So start cancelling debt and the bankers pyramid of leveraged debt begins to crumble. The fact that it has to crumble if we are to recover without being crippled with trying to pay unpayable debts never gets a mention in banker-world.

A second reason bankers don't like cancelling debt is that what would quickly get revealed is which banks are the walking dead kept alive by transfusions from us. At the moment they are all hiding each others debts.

Think about it - they all want the debts they owe each other to be paid in full - but since they can't afford to pay them, they have got our politicians to make US pay all the debts they owe to each other, for them.

http://golemxiv-credo.blogspot.com/2011/05/how-to-destroy-web-of-debt.html

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Plus the fees and bonuses they cream off CDS and rate swaps on the debts and consultancy fees to all the govts.

Pyramid scamming scheme all supported by taxpayers whilst their wages, services and standard of living falls.

Osborne and Boris will be on for mega Bankster jobs when they've delivered this for their paymasters.

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As the article says, a jubilee will wipe out all those 'assets' on bank balance sheets. This will devastate the banking sector.

Either way, jubilee or default, the banks will collapse, so get your money out while you can.

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As the article says, a jubilee will wipe out all those 'assets' on bank balance sheets. This will devastate the banking sector.

Either way, jubilee or default, the banks will collapse, so get your money out while you can.

Sink the ba$tards...NOW!

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Are these debts owned to the other governments or to banks in those countries? i.e. two governments can't mutually cancel their debts if all the debts are owed to a 3rd party (i.e. the banks?)

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Are these debts owned to the other governments or to banks in those countries? i.e. two governments can't mutually cancel their debts if all the debts are owed to a 3rd party (i.e. the banks?)

Don't let reality get in the way of a nice little fantasy ;)

I do not think that the amount of true netting of assets and liabilities across actual legal entities would be material.

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Is that a little like the fantasy of private insolvency, guarantees, subsidies and bail outs?

Like the ongoing public asset stripping?

Governments can do whatever they like.

A lot of promises have been made that will not be kept which will be very painful for a lot of people and institutions.

The political class, creditors, debtors and monetary authorities are seeking "solutions" that will somehow avoid the pain of unkept promises. Their only "success" will be in choosing who bears the brunt of the pain. They will fail to reduce the total amount of pain.

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  • 284 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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