Comments on: Euro crisis is race against time http://blogs.reuters.com/hugo-dixon/2012/10/01/euro-crisis-is-race-against-time/ Mon, 18 Apr 2016 14:55:08 +0000 hourly 1 http://wordpress.org/?v=4.2.5 By: Samrch http://blogs.reuters.com/hugo-dixon/2012/10/01/euro-crisis-is-race-against-time/comment-page-1/#comment-493 Tue, 02 Oct 2012 21:50:07 +0000 http://blogs.reuters.com/hugo-dixon/?p=413#comment-493 If they are bankrupt they should declare bankruptcy and tell the creditors it is end of the line if they cannot pay without killing people it is the end of the line. They will have take some banks to make business loans the rest will go under. They then have to build export industries to pay for imports. If other nations cry foal, they could offer with glee to extradite their ex-politicians and bankers who got into the mess to any nation who try to put them in jail for fraud or whatever.

You cannot bleed a dry rock. If they cannot pay the creditors lose unless they can sell the debt to some sucker. That the first rule of finance. Even in days of slavery if someone owed more than the sum of what his labor would be worth and what had the creditors lost.

No one is talking about growing export industries by taking form thew other industries.

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By: Willvp http://blogs.reuters.com/hugo-dixon/2012/10/01/euro-crisis-is-race-against-time/comment-page-1/#comment-492 Tue, 02 Oct 2012 14:41:05 +0000 http://blogs.reuters.com/hugo-dixon/?p=413#comment-492 @OneOfTheSheep:

If there ever is a democratic election in Europe to elect the top echelon of the EU, ECB etc…then I will gladly inform you.

The top is still “appointed” by…nobody knows actually, by themselves I guess, possibly with the help of an American financial institution, if you check where those elected, were either trained, or worked before.

And maybe, one day, their budget will be approved by the member states, as apparantly that never happened in the life of this political institution….Amazing that the media don’t jump on those undemocratic issues.

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By: scythe http://blogs.reuters.com/hugo-dixon/2012/10/01/euro-crisis-is-race-against-time/comment-page-1/#comment-491 Tue, 02 Oct 2012 13:33:53 +0000 http://blogs.reuters.com/hugo-dixon/?p=413#comment-491 (quote) “Europeans must revise personal expectations of government to what their collective productivity can sustain, as elsewhere. Your “paradise” is that of an immature self-centered fool.”

… no sooner read, then forgotten

like Linux OS, the European Union requires considerable user input and self-education

Another analogy is to grasp at least three european languages and cultures

You don’t have to, but don’t cry if you can’t track the cultural and political landscape. Understanding the European Union requires more than eating fat-free fries.

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By: GrahamLovell http://blogs.reuters.com/hugo-dixon/2012/10/01/euro-crisis-is-race-against-time/comment-page-1/#comment-490 Tue, 02 Oct 2012 12:15:25 +0000 http://blogs.reuters.com/hugo-dixon/?p=413#comment-490 Well put Willvp, and nicely apologised OneOfTheSheep; if only all on-line disputes were so graciously resolved.

Looking at it from Australia, the Euro economic model is interesting, in that it does not allow for heavy-handed Keynesian-style stimulus of the economy. Yet it would appear that, if each country plays the game and keeps its budget in balance over the medium term, it could still prove to be a workable system.

The Euro model means that when things get tough, government expenditure has to be cut, including pensions and wages. It would be nice if plutocrats led the field in this by cutting their pensions and pay, even though the main benefit of this would be in the example set (there are not enough plutocrats to really affect the bottom line).

The austerity model actually make sense; it is the household budget on a grand scale: reduce expenditure when there is not enough income, rather than borrowing against the future.

However, the austerity model will continue to be under attack until it starts to deliver an end to the crisis in one of the countries currently suffering badly. Perhaps this will be in Spain or Italy.

Two things are clear from this great distance; a government cannot spend more cash than it can get its hands on; and rioting will not help to restore the economy.

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By: OneOfTheSheep http://blogs.reuters.com/hugo-dixon/2012/10/01/euro-crisis-is-race-against-time/comment-page-1/#comment-489 Tue, 02 Oct 2012 08:49:55 +0000 http://blogs.reuters.com/hugo-dixon/?p=413#comment-489 @Willvp,

My apologies for any offense.

I speak as an American from the inherent limitations of purely American experience. There seems considerable difference between the “typical perspective” of Europeans and Americans as to respective working hours, social benefits and the “bottom line” of productivity.

Given that there are few places in the world that English is not commonly spoken, most Americans are not sufficiently fascinated with other languages to learn another, or with individual countries or their politics/politicians within the Euro zone other than as which may be in economic difficulty.

Accordingly, I freely confess my inability to answer your question. I merely expressed my present understanding that European countries today function generally in a democratic manner, in form if not in function.

If that’s not so, please enlighten?

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By: Willvp http://blogs.reuters.com/hugo-dixon/2012/10/01/euro-crisis-is-race-against-time/comment-page-1/#comment-488 Tue, 02 Oct 2012 06:25:52 +0000 http://blogs.reuters.com/hugo-dixon/?p=413#comment-488 @OneOfTheSheep:

You explain to me, slowly because English is NOT my mother tongue, on HOW and by WHOM for instance Van Rompuy and Barosso and Rehn and Monti were elected.

Always good to know that I am/was wrong but I will decide on that AFTER your learned assistance.

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By: dareconomics http://blogs.reuters.com/hugo-dixon/2012/10/01/euro-crisis-is-race-against-time/comment-page-1/#comment-487 Mon, 01 Oct 2012 22:33:40 +0000 http://blogs.reuters.com/hugo-dixon/?p=413#comment-487 This is an excellent analysis of the present state of the Eurocrisis, and Mr. Dixon even forecasts that the eurozone will probably pull through another bad year.

I am not so sanguine about Europe’s prospects. German electioneering has begun with Peer Steinbrueck being elected to lead the Social Democrats against Merkel’s conservative coalition. German elections will take place in just about one year, which coincidentally is how long the eurozone is predicted to keep lurching along.

A distinct pattern has developed during the crisis. Governments have fallen at a rapid clip. The Dutch elections last month were the first time that a government in power survived since the onset of the crisis in 2009.

What the politicians in every country are trying to do is remain in power. This is the Merkel’s plan, too, and it is no coincidence that current measures appear to keep the lid on things for another year or so.

This is where we reach the limits of analysis. Any commentator on the Eurocrisis must realize that the eurozone has become critically unstable, just like a snow packed mountain before an avalanche.

When I read about how avalanches were like market crashes, it was stated more succinctly, but let me give it a shot. Imagine a mountain covered in snow. There is another snowstorm and another. Pretty soon, the snow pack on the mountain reaches a critical point. One more snowflake will trigger the avalanche, but we cannot blame this last snowflake.

Several snowfalls have contributed to this disaster. The last snowflake just came along at the wrong place at the wrong time. Of course, maybe we just experienced the last snowfall of the season and the summer melt removes the danger of the avalanche. It is not inevitable that our hypothetical snowflake falls.

The Eurocrisis has now reached a critical stage. The next snowflake could trigger a disaster, but right now it appears that it will not snow.

This is a dangerous view. As with many complex systems wrought by man, the eurozone is to complex for us to understand. As Rumsfeld would say, there are things that we don’t know we don’t know. Look at two surprises from the last few months. Did anyone predict a resurgence of either Catalan separatism or Greek fascism?

The question is what other nasty surprises are lurking beneath the exteriors of these countries. Any one of these could trigger the avalanche. Perhaps, a TBTF bank will be caught lying about its true market condition creating a panic. Maybe a government will be caught in a similar lie. There could be a political crisis, like a coup.

When a system is this unstable, it can come crashing down in an instant, and no one will see it coming. The best that we can do with analysis is recognize when the system is unstable, not predict when it will die.

dareconomics.wordpress.com

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By: OneOfTheSheep http://blogs.reuters.com/hugo-dixon/2012/10/01/euro-crisis-is-race-against-time/comment-page-1/#comment-486 Mon, 01 Oct 2012 21:58:39 +0000 http://blogs.reuters.com/hugo-dixon/?p=413#comment-486 @Willvp,

“Ruining the whole of Europe to satisfy, some bad cooked plans, from self-appointed politicians.” English is not your “first language, is it?

The existing socialist society you apparently wish to preserve is finally, as Margaret Thatcher predicted, “…running out of other people’s money” and even their own. Europeans must revise personal expectations of government to what their collective productivity can sustain, as elsewhere. Your “paradise” is that of an immature self-centered fool.

There are no “self-appointed politicians”. They are elected, even where elections are among poor choices or the outcome is “rigged”. Perfection is a wonderful goal, but yet to be achieved anywhere.

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By: Willvp http://blogs.reuters.com/hugo-dixon/2012/10/01/euro-crisis-is-race-against-time/comment-page-1/#comment-485 Mon, 01 Oct 2012 19:18:18 +0000 http://blogs.reuters.com/hugo-dixon/?p=413#comment-485 And let us not forget that those same politicians where PART and PARCEL of this mess during their political time in their own country, before they were dumped at the EU, to earn hugh end-of-carriere remuneration and a big lifetime pension. (did they put austerity on their own pensions/wages? Oh no, they forgot)

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By: Willvp http://blogs.reuters.com/hugo-dixon/2012/10/01/euro-crisis-is-race-against-time/comment-page-1/#comment-484 Mon, 01 Oct 2012 19:11:55 +0000 http://blogs.reuters.com/hugo-dixon/?p=413#comment-484 Ruining the whole of Europe to satisfy, some bad cooked plans, from self-appointed politicians.

Do those politicians sleep well at night? Or do they really don’t give a …

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