Greece Financial Crisis Thread (1 Viewer)

[Soonerman]

I hope that country implodes. Bunch of freeloaders.

The EU deserves the blame as well since they:

- made it cheap for them to borrow money without any controls

- didn't require them to adjust their entitlement programs before joining

- didn't require to solve their tax evasion problem before joining

Bottom line - Greece should never have been allowed into the Euro.

This may be true and I'm sure I don't have an adequate understanding of the complexities of what's going on. I just have no tolerance for people/countries that put themselves in a financial mess and are unwilling to make the necessary sacrifices to get out of that mess.

Lots of US companies file bankruptcy do you avoid them?

Only if they take government bailout money.

 

[Fennis]

I hope that country implodes. Bunch of freeloaders.

The EU deserves the blame as well since they:

- made it cheap for them to borrow money without any controls

- didn't require them to adjust their entitlement programs before joining

- didn't require to solve their tax evasion problem before joining

Bottom line - Greece should never have been allowed into the Euro.

This may be true and I'm sure I don't have an adequate understanding of the complexities of what's going on. I just have no tolerance for people/countries that put themselves in a financial mess and are unwilling to make the necessary sacrifices to get out of that mess.

Lots of US companies file bankruptcy do you avoid them?

Only if they take government bailout money.

That's a pretty long list

http://projects.propublica.org/bailout/list

 

[Soonerman]

So what do we need to learn from this crisis?

If you hook a society on entitlements, they feel entitled to them, no matter what.

 

[Tiger Fan]

dot

 

[beer 30]

I hope that country implodes. Bunch of freeloaders.

The EU deserves the blame as well since they:

- made it cheap for them to borrow money without any controls

- didn't require them to adjust their entitlement programs before joining

- didn't require to solve their tax evasion problem before joining

Bottom line - Greece should never have been allowed into the Euro.

And the massive debt welching Germans gave them all those loans and then demanded strict repayment terms that crushed their national economy.

Fool me once, shame on you...

That sentence brought the Treaty of Versailles to mind only in reverse with Germany dictating the terms this time around

 

[[icon]]

So what do we need to learn from this crisis?

This is us in 20 years?

 

[Dinsy Ejotuz]

I hope that country implodes. Bunch of freeloaders.

The EU deserves the blame as well since they:

- made it cheap for them to borrow money without any controls

- didn't require them to adjust their entitlement programs before joining

- didn't require to solve their tax evasion problem before joining

Bottom line - Greece should never have been allowed into the Euro.

This may be true and I'm sure I don't have an adequate understanding of the complexities of what's going on. I just have no tolerance for people/countries that put themselves in a financial mess and are unwilling to make the necessary sacrifices to get out of that mess.

Lots of US companies file bankruptcy do you avoid them?

This doesn't have to do with avoiding them. Heck, bail them out, but just like a company, Greece should have to go through a lot of pain and sacrifice if its going to be bailed out. They created this mess.

What more do you want them to do than what they've done in the last five years?

And considering that doing what they've been asked -- balancing the budget and fixing some of the pension/tax isues -- has made the problem worse why would they keep doing it?

 

[Dinsy Ejotuz]

So what do we need to learn from this crisis?

This is us in 20 years?

I don't think you understand the problem very well.

 

[NutterButter]

I hope that country implodes. Bunch of freeloaders.

The EU deserves the blame as well since they:

- made it cheap for them to borrow money without any controls

- didn't require them to adjust their entitlement programs before joining

- didn't require to solve their tax evasion problem before joining

Bottom line - Greece should never have been allowed into the Euro.

This may be true and I'm sure I don't have an adequate understanding of the complexities of what's going on. I just have no tolerance for people/countries that put themselves in a financial mess and are unwilling to make the necessary sacrifices to get out of that mess.

Lots of US companies file bankruptcy do you avoid them?

This doesn't have to do with avoiding them. Heck, bail them out, but just like a company, Greece should have to go through a lot of pain and sacrifice if its going to be bailed out. They created this mess.

What more do you want them to do than what they've done in the last five years?

And considering that doing what they've been asked -- balancing the budget and fixing some of the pension/tax isues -- has made the problem worse why would they keep doing it?

They don't have to keep doing it. But if they don't, I wouldn't give them any more money. Good luck. Weren't there terms agreed upon in regards to this ongoing bailout? Sounds like they voted no to continuing to live up to those terms.

 

[Dinsy Ejotuz]

They don't have to keep doing it. But if they don't, I wouldn't give them any more money. Good luck. Weren't there terms agreed upon in regards to this ongoing bailout? Sounds like they voted no to continuing to live up to those terms.

Gottit.

Greece will go through chaos when they leave the Euro, but then things will get better (relative to continuing to try and pay off a debt they will never be able to pay off).

 

[NutterButter]

They don't have to keep doing it. But if they don't, I wouldn't give them any more money. Good luck. Weren't there terms agreed upon in regards to this ongoing bailout? Sounds like they voted no to continuing to live up to those terms.

Gottit.

Greece will go through chaos when they leave the Euro, but then things will get better (relative to continuing to try and pay off a debt they will never be able to pay off).

Sounds like that's a better option for them then

 

[FlapJacks]

You need to grow your way out of debt....welcome to supply side

 

[jonessed]

They don't have to keep doing it. But if they don't, I wouldn't give them any more money. Good luck. Weren't there terms agreed upon in regards to this ongoing bailout? Sounds like they voted no to continuing to live up to those terms.

Gottit.

Greece will go through chaos when they leave the Euro, but then things will get better (relative to continuing to try and pay off a debt they will never be able to pay off).

Sounds like that's a better option for them then

Their social services will be permanently gutted either way. They have been living in a pipe dream for decades.

 

[cstu]

So what do we need to learn from this crisis?

If you're going to commit to massive social programs, make sure you can also massively inflate your currency to pay the bill.

 

[Rohn Jambo]

Apparently Germany was pissed they did not have the Dogecoin option when Greece forgave their debt after WWII.

http://yanisvaroufakis.eu/2015/07/06/minister-no-more/.

 

[cstu]

OK I can see that austerity made things worse. But what should the Greeks do then? Is there any way out of this? And if there isn't, what is the least painful alternative?

Maybe Greece should imitate the biggest debt welching terds of all: the Germans.

Great article.

 

[Rohn Jambo]

I have a buddy that is in our poker game who is originally from Greece. He's over there right now. His wife was going over to join him and is considering not going with all the things going on.

I hope you don't spot him any cash.

The Bank Nazi says, "No cash for him."http://www.reuters.com/article/2015/07/05/eurozone-greece-cash-idUSA8N0XO00920150705

 

[MaxThreshold]

So what do we need to learn from this crisis?

If you hook a society on entitlements, they feel entitled to them, no matter what.

Good thing the American left isn't trying to do that here. I mean, i'm sure they're looking at Greece and re-adjusting their ideology based on that whole "give them more entitlements" philosophy. Right?

 

[urbanhack]

So what do we need to learn from this crisis?

Don't adopt a new currency along with other countries that have a different economy that yours.

 

[Todd Andrews]

OK I can see that austerity made things worse. But what should the Greeks do then? Is there any way out of this? And if there isn't, what is the least painful alternative?

Maybe Greece should imitate the biggest debt welching terds of all: the Germans.

Great article.

Pickety annihilates Germany.

 

[culdeus]

Think England is spiking the football right now?

 

[Fennis]

Think England is spiking the football right now?

Not really, they are part of the EU

 

[Fennis]

The bigger issue is whats going on in China. That has serious repercussions.

http://www.foxbusiness.com/markets/2015/07/06/beijing-makes-emergency-move-to-relieve-markets/

 

[MaxThreshold]

OK I can see that austerity made things worse. But what should the Greeks do then? Is there any way out of this? And if there isn't, what is the least painful alternative?

Maybe Greece should imitate the biggest debt welching terds of all: the Germans.

Great article.

Pickety annihilates Germany.

Pickety? JFC.

...it is worth pointing out that liberal pundits and writers have not only enthusiastically and unconditionally embraced a book on economics, or even a run-of-the-mill leftist polemic, but a hard-left manifesto.


Now, I realize we’re all supposed to accept the fact that conservatives are alone in embracing fringe economic ideas. But how does a book that evokes Marx and talks about tweaking the Soviet experiment find so much love from people who consider themselves rational, evidence-driven moderates?

 

[Mark Davis]

This is going to be interesting to see how this plays out. The EU is in a bind here. They really can't cut Greece a deal they aren't willing to match for Portugal and Italy.

 

[Politician Spock]

This is going to be interesting to see how this plays out. The EU is in a bind here. They really can't cut Greece a deal they aren't willing to match for Portugal and Italy.

This is a classic "damned if you do, damned if you don't" situation. Regardless of what the EU does, it's damned.

I think I hear Jean Valjean singing "Who Am I" in the background.

 

[cstu]

Pickety? JFC.

...it is worth pointing out that liberal pundits and writers have not only enthusiastically and unconditionally embraced a book on economics, or even a run-of-the-mill leftist polemic, but a hard-left manifesto.

Now, I realize we’re all supposed to accept the fact that conservatives are alone in embracing fringe economic ideas. But how does a book that evokes Marx and talks about tweaking the Soviet experiment find so much love from people who consider themselves rational, evidence-driven moderates?

It's possible to agree with someone's general philosophy but prefer a centrist approach rather than their extreme one. Only the far left wing wants an 80% top tax bracket.

 

[Mark Davis]

Pickety? JFC.

...it is worth pointing out that liberal pundits and writers have not only enthusiastically and unconditionally embraced a book on economics, or even a run-of-the-mill leftist polemic, but a hard-left manifesto.

Now, I realize we’re all supposed to accept the fact that conservatives are alone in embracing fringe economic ideas. But how does a book that evokes Marx and talks about tweaking the Soviet experiment find so much love from people who consider themselves rational, evidence-driven moderates?

It's possible to agree with someone's general philosophy but prefer a centrist approach rather than their extreme one. Only the far left wing wants an 80% top tax bracket.

I always find it interesting the marginal rate of that bracket is where tax discussion always lands. That kind of move would impact someone making $500,000 a year of earned income much more than someone who is making millions a year in capital gains income. It's a good talking point when it comes to the "pay your fair share" rhetoric, but in reality it wouldn't impact most of the people that the target market is envisioning.

I know you're not suggesting that nor has someone like Bernie Sanders for instance, given a quantitative tax plan, but in general politicians always go after the marginal rates. Granted, the marginal rate increase is a tough road to hoe, but if they went after cap gains rates it would bring more lobbyists out than you could stir with a stick.

 

[tdog]

So what do we need to learn from this crisis?

This is us in 20 years?

I thought it was going to be us in 5 years (at least that is what 2010 tea party winners told us). Glad Obama has been able to put this off till 2035. Should I slow my rate of gold purchases now that we are good for a couple of decades?

 

[Mark Davis]

So what do we need to learn from this crisis?

This is us in 20 years?

I thought it was going to be us in 5 years (at least that is what 2010 tea party winners told us). Glad Obama has been able to put this off till 2035. Should I slow my rate of gold purchases now that we are good for a couple of decades?

Eh, it's kinda like celebrating finding a 0% introductory rate to transfer your balance to. Low interest rate environments in the present day make kicking the can easy. When that rate is gone, it's a bigger issue. Just like the consumer who gets himself into trouble, we don't see the low rates as an opportunity to extinguish the problem while it's at it's most manageable.

 

[Politician Spock]

So what do we need to learn from this crisis?

This is us in 20 years?

I thought it was going to be us in 5 years (at least that is what 2010 tea party winners told us). Glad Obama has been able to put this off till 2035. Should I slow my rate of gold purchases now that we are good for a couple of decades?

As long as the dollar remains the world reserve currency, this will never be us.

As the world grows, it needs more dollars in reserve. We supply the world with these dollars by buying more in imported goods than we sell in exported goods. And we have the dollars to buy that excess of imports because the Federal government creates newly issued bonds that are bought by the Federal Reserve with newly issued dollars, and then deficit spends them into the economy. If the US government actually had a balanced budget, the necessary flow of increased dollars in our economy, and more importantly the world economy, would slow to a crawl and cause all kinds of economic hell... or in other words it would be 2008 all over again. Which is why Federal Reserve going on a massive printing spree and the US government going on a massive spending spree was necessary following 2008.

Essentially the world needs the US to spend more and more new dollars into the world. Greece on the hand (as well as no other country) can't have the same fiscal policy as the US for that reason.

 

[tdog]

So what do we need to learn from this crisis?

This is us in 20 years?

I thought it was going to be us in 5 years (at least that is what 2010 tea party winners told us). Glad Obama has been able to put this off till 2035. Should I slow my rate of gold purchases now that we are good for a couple of decades?

Eh, it's kinda like celebrating finding a 0% introductory rate to transfer your balance to. Low interest rate environments in the present day make kicking the can easy. When that rate is gone, it's a bigger issue. Just like the consumer who gets himself into trouble, we don't see the low rates as an opportunity to extinguish the problem while it's at it's most manageable.

We could also just grow the economy, like a consumer who starts to make a lot of money. The most important question about debt, tax policy, government spending, regulation, immigration or anything else the government is involved with is not whether there should be more or less of any of it. It should be--will it make us more money in the end. That used to be what conservatives talked about.

 

[Maurile Tremblay]

Milton Friedman wrote a good (very short) article back in 1997 on the advantages and disadvantages of a common currency versus flexible exchange rates.

 

[Jayrod]

So what do we need to learn from this crisis?

This is us in 20 years?

I thought it was going to be us in 5 years (at least that is what 2010 tea party winners told us). Glad Obama has been able to put this off till 2035. Should I slow my rate of gold purchases now that we are good for a couple of decades?

As long as the dollar remains the world reserve currency, this will never be us.As the world grows, it needs more dollars in reserve. We supply the world with these dollars by buying more in imported goods than we sell in exported goods. And we have the dollars to buy that excess of imports because the Federal government creates newly issued bonds that are bought by the Federal Reserve with newly issued dollars, and then deficit spends them into the economy. If the US government actually had a balanced budget, the necessary flow of increased dollars in our economy, and more importantly the world economy, would slow to a crawl and cause all kinds of economic hell... or in other words it would be 2008 all over again. Which is why Federal Reserve going on a massive printing spree and the US government going on a massive spending spree was necessary following 2008.

Essentially the world needs the US to spend more and more new dollars into the world. Greece on the hand (as well as no other country) can't have the same fiscal policy as the US for that reason.

Except that eventually it all has to be dealt with, either through some miraculous boom (unlikely), or an eventual cutback (still unlikely), or inflation (maybe), or a default on debts (possible). Continual borrowing to cover deficits can't continue forever without some painful correction. Inflation would be our best and least painful option, IMO.

 

[Politician Spock]

So what do we need to learn from this crisis?

This is us in 20 years?

I thought it was going to be us in 5 years (at least that is what 2010 tea party winners told us). Glad Obama has been able to put this off till 2035. Should I slow my rate of gold purchases now that we are good for a couple of decades?

As long as the dollar remains the world reserve currency, this will never be us.As the world grows, it needs more dollars in reserve. We supply the world with these dollars by buying more in imported goods than we sell in exported goods. And we have the dollars to buy that excess of imports because the Federal government creates newly issued bonds that are bought by the Federal Reserve with newly issued dollars, and then deficit spends them into the economy. If the US government actually had a balanced budget, the necessary flow of increased dollars in our economy, and more importantly the world economy, would slow to a crawl and cause all kinds of economic hell... or in other words it would be 2008 all over again. Which is why Federal Reserve going on a massive printing spree and the US government going on a massive spending spree was necessary following 2008.

Essentially the world needs the US to spend more and more new dollars into the world. Greece on the hand (as well as no other country) can't have the same fiscal policy as the US for that reason.

Except that eventually it all has to be dealt with, either through some miraculous boom (unlikely), or an eventual cutback (still unlikely), or inflation (maybe), or a default on debts (possible).Continual borrowing to cover deficits can't continue forever without some painful correction. Inflation would be our best and least painful option, IMO.

Well, I'm of the mindset that in theory this process of the US being the world's source of money for international exchange can work in perpetuity, but won't. Not for for systemic reasons, but political reasons. The US lacks the political control to ensure we remain the issuers of the worlds reserve currency. We flex our military might as a way to have indirect political control, but that's a dangerous way to maintain that control as it tends to create enemies. And when the enemies grow large enough, then the political reasons to end the process arrive. When that day comes (and it WILL come), life in America will change drastically, as we will not only have to switch to exporting as much as we import to avoid growing our debt, we have to start that process while already in massive debt. It will be the most historic fall of an empire in world history. And I think it will happen in my lifetime.

 

[Dinsy Ejotuz]

Milton Friedman wrote a good (very short) article back in 1997 on the advantages and disadvantages of a common currency versus flexible exchange rates.

I believe that adoption of the Euro would have the opposite effect. It would exacerbate political tensions by converting divergent shocks that could have been readily accommodated by exchange rate changes into divisive political issues. Political unity can pave the way for monetary unity. Monetary unity imposed under unfavorable conditions will prove a barrier to the achievement of political unity.

 

[jonessed]

This is going to be interesting to see how this plays out. The EU is in a bind here. They really can't cut Greece a deal they aren't willing to match for Portugal and Italy.

Greece should never have been allowed into the EU. Now that the European banking system has insulated itself in preparation for a possible Grexit they need to rip the band-aid off.

 

[sbonomo]

 

[culdeus]

So what do we need to learn from this crisis?

This is us in 20 years?

I thought it was going to be us in 5 years (at least that is what 2010 tea party winners told us). Glad Obama has been able to put this off till 2035. Should I slow my rate of gold purchases now that we are good for a couple of decades?

As long as the dollar remains the world reserve currency, this will never be us.As the world grows, it needs more dollars in reserve. We supply the world with these dollars by buying more in imported goods than we sell in exported goods. And we have the dollars to buy that excess of imports because the Federal government creates newly issued bonds that are bought by the Federal Reserve with newly issued dollars, and then deficit spends them into the economy. If the US government actually had a balanced budget, the necessary flow of increased dollars in our economy, and more importantly the world economy, would slow to a crawl and cause all kinds of economic hell... or in other words it would be 2008 all over again. Which is why Federal Reserve going on a massive printing spree and the US government going on a massive spending spree was necessary following 2008.

Essentially the world needs the US to spend more and more new dollars into the world. Greece on the hand (as well as no other country) can't have the same fiscal policy as the US for that reason.

Except that eventually it all has to be dealt with, either through some miraculous boom (unlikely), or an eventual cutback (still unlikely), or inflation (maybe), or a default on debts (possible).Continual borrowing to cover deficits can't continue forever without some painful correction. Inflation would be our best and least painful option, IMO.

Well, I'm of the mindset that in theory this process of the US being the world's source of money for international exchange can work in perpetuity, but won't. Not for for systemic reasons, but political reasons. The US lacks the political control to ensure we remain the issuers of the worlds reserve currency. We flex our military might as a way to have indirect political control, but that's a dangerous way to maintain that control as it tends to create enemies. And when the enemies grow large enough, then the political reasons to end the process arrive. When that day comes (and it WILL come), life in America will change drastically, as we will not only have to switch to exporting as much as we import to avoid growing our debt, we have to start that process while already in massive debt. It will be the most historic fall of an empire in world history. And I think it will happen in my lifetime.

The whole push for "globalization" is to insure against this very situation.

The other thing is that someone has to be the world's reserve currency. And China ain't looking like they are ready to take that flag and run with it.

 

[cstu]

Well, I'm of the mindset that in theory this process of the US being the world's source of money for international exchange can work in perpetuity, but won't. Not for for systemic reasons, but political reasons. The US lacks the political control to ensure we remain the issuers of the worlds reserve currency. We flex our military might as a way to have indirect political control, but that's a dangerous way to maintain that control as it tends to create enemies. And when the enemies grow large enough, then the political reasons to end the process arrive. When that day comes (and it WILL come), life in America will change drastically, as we will not only have to switch to exporting as much as we import to avoid growing our debt, we have to start that process while already in massive debt. It will be the most historic fall of an empire in world history. And I think it will happen in my lifetime.

Having a powerful military gives us political control, not using it indiscriminately. Attacking Iraq is an example of an event that destroyed our standing in the world.

To remain the reserve currency, we need to be viewed as economically strong, politically stable, and not a threat to world security. China is nowhere close and Europe is looking like fractured mess.

 

[Kal El]

So what do we need to learn from this crisis?

This is us in 20 years?

I thought it was going to be us in 5 years (at least that is what 2010 tea party winners told us). Glad Obama has been able to put this off till 2035. Should I slow my rate of gold purchases now that we are good for a couple of decades?

As long as the dollar remains the world reserve currency, this will never be us.As the world grows, it needs more dollars in reserve. We supply the world with these dollars by buying more in imported goods than we sell in exported goods. And we have the dollars to buy that excess of imports because the Federal government creates newly issued bonds that are bought by the Federal Reserve with newly issued dollars, and then deficit spends them into the economy. If the US government actually had a balanced budget, the necessary flow of increased dollars in our economy, and more importantly the world economy, would slow to a crawl and cause all kinds of economic hell... or in other words it would be 2008 all over again. Which is why Federal Reserve going on a massive printing spree and the US government going on a massive spending spree was necessary following 2008.

Essentially the world needs the US to spend more and more new dollars into the world. Greece on the hand (as well as no other country) can't have the same fiscal policy as the US for that reason.

Except that eventually it all has to be dealt with, either through some miraculous boom (unlikely), or an eventual cutback (still unlikely), or inflation (maybe), or a default on debts (possible).Continual borrowing to cover deficits can't continue forever without some painful correction. Inflation would be our best and least painful option, IMO.

Well, I'm of the mindset that in theory this process of the US being the world's source of money for international exchange can work in perpetuity, but won't. Not for for systemic reasons, but political reasons. The US lacks the political control to ensure we remain the issuers of the worlds reserve currency. We flex our military might as a way to have indirect political control, but that's a dangerous way to maintain that control as it tends to create enemies. And when the enemies grow large enough, then the political reasons to end the process arrive. When that day comes (and it WILL come), life in America will change drastically, as we will not only have to switch to exporting as much as we import to avoid growing our debt, we have to start that process while already in massive debt. It will be the most historic fall of an empire in world history. And I think it will happen in my lifetime.

The whole push for "globalization" is to insure against this very situation.

The other thing is that someone has to be the world's reserve currency. And China ain't looking like they are ready to take that flag and run with it.

As long as it's not the confederate flag. That thing's radioactive these days.

 

[jonessed]

So what do we need to learn from this crisis?

This is us in 20 years?

I thought it was going to be us in 5 years (at least that is what 2010 tea party winners told us). Glad Obama has been able to put this off till 2035. Should I slow my rate of gold purchases now that we are good for a couple of decades?

As long as the dollar remains the world reserve currency, this will never be us.As the world grows, it needs more dollars in reserve. We supply the world with these dollars by buying more in imported goods than we sell in exported goods. And we have the dollars to buy that excess of imports because the Federal government creates newly issued bonds that are bought by the Federal Reserve with newly issued dollars, and then deficit spends them into the economy. If the US government actually had a balanced budget, the necessary flow of increased dollars in our economy, and more importantly the world economy, would slow to a crawl and cause all kinds of economic hell... or in other words it would be 2008 all over again. Which is why Federal Reserve going on a massive printing spree and the US government going on a massive spending spree was necessary following 2008.

Essentially the world needs the US to spend more and more new dollars into the world. Greece on the hand (as well as no other country) can't have the same fiscal policy as the US for that reason.

Except that eventually it all has to be dealt with, either through some miraculous boom (unlikely), or an eventual cutback (still unlikely), or inflation (maybe), or a default on debts (possible).Continual borrowing to cover deficits can't continue forever without some painful correction. Inflation would be our best and least painful option, IMO.

Well, I'm of the mindset that in theory this process of the US being the world's source of money for international exchange can work in perpetuity, but won't. Not for for systemic reasons, but political reasons. The US lacks the political control to ensure we remain the issuers of the worlds reserve currency. We flex our military might as a way to have indirect political control, but that's a dangerous way to maintain that control as it tends to create enemies. And when the enemies grow large enough, then the political reasons to end the process arrive. When that day comes (and it WILL come), life in America will change drastically, as we will not only have to switch to exporting as much as we import to avoid growing our debt, we have to start that process while already in massive debt. It will be the most historic fall of an empire in world history. And I think it will happen in my lifetime.

The whole push for "globalization" is to insure against this very situation.

The other thing is that someone has to be the world's reserve currency. And China ain't looking like they are ready to take that flag and run with it.

There are already multiple recognized reserve currencies. The dollar just happens to be by far the largest. You could also have a multi-currency reserve system.

I believe Gazprom is already trading on the yuan.

 

[Politician Spock]

So what do we need to learn from this crisis?

This is us in 20 years?

I thought it was going to be us in 5 years (at least that is what 2010 tea party winners told us). Glad Obama has been able to put this off till 2035. Should I slow my rate of gold purchases now that we are good for a couple of decades?

As long as the dollar remains the world reserve currency, this will never be us.As the world grows, it needs more dollars in reserve. We supply the world with these dollars by buying more in imported goods than we sell in exported goods. And we have the dollars to buy that excess of imports because the Federal government creates newly issued bonds that are bought by the Federal Reserve with newly issued dollars, and then deficit spends them into the economy. If the US government actually had a balanced budget, the necessary flow of increased dollars in our economy, and more importantly the world economy, would slow to a crawl and cause all kinds of economic hell... or in other words it would be 2008 all over again. Which is why Federal Reserve going on a massive printing spree and the US government going on a massive spending spree was necessary following 2008.

Essentially the world needs the US to spend more and more new dollars into the world. Greece on the hand (as well as no other country) can't have the same fiscal policy as the US for that reason.

Except that eventually it all has to be dealt with, either through some miraculous boom (unlikely), or an eventual cutback (still unlikely), or inflation (maybe), or a default on debts (possible).Continual borrowing to cover deficits can't continue forever without some painful correction. Inflation would be our best and least painful option, IMO.

Well, I'm of the mindset that in theory this process of the US being the world's source of money for international exchange can work in perpetuity, but won't. Not for for systemic reasons, but political reasons. The US lacks the political control to ensure we remain the issuers of the worlds reserve currency. We flex our military might as a way to have indirect political control, but that's a dangerous way to maintain that control as it tends to create enemies. And when the enemies grow large enough, then the political reasons to end the process arrive. When that day comes (and it WILL come), life in America will change drastically, as we will not only have to switch to exporting as much as we import to avoid growing our debt, we have to start that process while already in massive debt. It will be the most historic fall of an empire in world history. And I think it will happen in my lifetime.

The whole push for "globalization" is to insure against this very situation.

The other thing is that someone has to be the world's reserve currency. And China ain't looking like they are ready to take that flag and run with it.

In the past, this was true. With today's technology, it's no longer the case. The only reason the world continues to function the way it does is because the US economy would collapse if it didn't, and the thought of what the world would look like without 300 million Americans no longer consuming the world's goods bought on credit is a scary thought.

 

[timschochet]

After reading more and more about this situation, I have come to the conclusion that the best alternative is for Germany and the EU to soften their stance, to send more money to Greece without insisting on further austerity and to hope that Greece's economy can eventually grow its way out of debt. And Obama should actively try to push Merkel towards this solution, even offering to help if need be.

This is not a question of right or wrong or whether Greece deserves help. Whether they deserve it or not, I believe it's to our benefit that they get it.

 

[Politician Spock]

After reading more and more about this situation, I have come to the conclusion that the best alternative is for Germany and the EU to soften their stance, to send more money to Greece without insisting on further austerity and to hope that Greece's economy can eventually grow its way out of debt. And Obama should actively try to push Merkel towards this solution, even offering to help if need be.

This is not a question of right or wrong or whether Greece deserves help. Whether they deserve it or not, I believe it's to our benefit that they get it.

...and Spain, Portugal and others begin to salivate on thoughts of the deal they will now be able to get from the EU too.

 

[timschochet]

After reading more and more about this situation, I have come to the conclusion that the best alternative is for Germany and the EU to soften their stance, to send more money to Greece without insisting on further austerity and to hope that Greece's economy can eventually grow its way out of debt. And Obama should actively try to push Merkel towards this solution, even offering to help if need be.

This is not a question of right or wrong or whether Greece deserves help. Whether they deserve it or not, I believe it's to our benefit that they get it.

...and Spain, Portugal and others begin to salivate on thoughts of the deal they will now be able to get from the EU too.

Cant worry about it.

 

[cstu]

After reading more and more about this situation, I have come to the conclusion that the best alternative is for Germany and the EU to soften their stance, to send more money to Greece without insisting on further austerity and to hope that Greece's economy can eventually grow its way out of debt. And Obama should actively try to push Merkel towards this solution, even offering to help if need be.

This is not a question of right or wrong or whether Greece deserves help. Whether they deserve it or not, I believe it's to our benefit that they get it.

...and Spain, Portugal and others begin to salivate on thoughts of the deal they will now be able to get from the EU too.

If the Euro is to survive it means Europe will have to operate like a federal government and member countries will need to give up sovereignty to in order insure their economic stability.

 

[Politician Spock]

After reading more and more about this situation, I have come to the conclusion that the best alternative is for Germany and the EU to soften their stance, to send more money to Greece without insisting on further austerity and to hope that Greece's economy can eventually grow its way out of debt. And Obama should actively try to push Merkel towards this solution, even offering to help if need be.

This is not a question of right or wrong or whether Greece deserves help. Whether they deserve it or not, I believe it's to our benefit that they get it.

...and Spain, Portugal and others begin to salivate on thoughts of the deal they will now be able to get from the EU too.

If the Euro is to survive it means Europe will have to operate like a federal government and member countries will need to give up sovereignty to in order insure their economic stability.

You are entirely correct. I doubt however we would see a United States of Europe.

 

[Politician Spock]

After reading more and more about this situation, I have come to the conclusion that the best alternative is for Germany and the EU to soften their stance, to send more money to Greece without insisting on further austerity and to hope that Greece's economy can eventually grow its way out of debt. And Obama should actively try to push Merkel towards this solution, even offering to help if need be.

This is not a question of right or wrong or whether Greece deserves help. Whether they deserve it or not, I believe it's to our benefit that they get it.

...and Spain, Portugal and others begin to salivate on thoughts of the deal they will now be able to get from the EU too.

Cant worry about it.

Can't ignore it either.

 

[timschochet]

Look when we chose to bail out Wall Street and General Motors we didn't spend time wondering what other big companies would demand bailouts in the future. We did what we had to in order to avoid making things much worse, and it was the right decision.