16-Jun-12 World View -- Anxious world awaits Greek elections

[John]

16-Jun-12 World View -- An anxious world awaits the results of Greece's elections



Mubarak's military cronies seem poised to rule Egypt

** 16-Jun-12 World View -- An anxious world awaits the results of Greece's elections
** http://www.generationaldynamics.com/cgi ... 16#e120616



Contents:
An anxious world awaits the results of Greece's elections
Greece and the 'Kick the Can Theory'
American jihadist group to hold conference in Chicago on Sunday
Mubarak's military cronies seem poised to rule Egypt


Keys:
Generational Dynamics, Greece, Syriza, Alexis Tsipras, Kick the Can Theory,
Law of Mean Reversion, Hizb Al-Tahrir America,
Egypt, Hosni Mubarak, Supreme Council of the Armed Forces, SCAF,
Muslim Brotherhood, Ahmed Shafiq, Mohamed Morsi

[mannfm11]

Looks like we have reached the point they reached in Viet Nam, where they had to destroy the village to save it. These outfits in Europe are broke. So are most of the other governments around the world. Their aim is clearly to systematically destroy the debt rather than solve it in bankruptcy. In doing so, they also will destroy the purchasing power of most involved, to save the fortunes of the political classes. The entire problem is being attacked backwards. Norhing has changed in 150 years, save for the gimicks put in place to save the bankers from being hung from light poles and called to account. Deposit insurance, in the end, must be paid by those with deposits, while in the meantime, the bankers, who went broke, continue to get their slice of the pie. A proportional deflation, followed by stimulus would have worked better than holding the status quo by stimulus, which will make problems worse and the collapse worse. Clearing debt through a proportional reduction of both sides of the balance sheet is the only long term workable solution. True recapitalization can only come from the credit side of the balance sheet of banks. The current tact is to pretend the debits are good.

[Trevor]

Just look at Greece to get an idea of where the rest of the world is headed. Once they collapse, it's quite possible for a dictatorship to assume power once again. They've only resembled democracy for about 35 years or so.

If they exit the eurozone, I think it'll be harmful to their economy but by itself, Europe would survive.

[mooreupp]

Europe might be able to survive a Greek exit (although don't think for a second that their banks, especially German ones didn't foolishly over-expose themselves there).

That's not the real issue though. Greece is just #1 on the list. Spain, Portugal, Ireland, and Italy aren't all that much better. As soon as Greece collapses and defaults, the yields will shoot up even more elsewhere with nervous investors who know they further defaults are coming. Spain will probably be next and that's a lot bigger fish. They can't contain this forever and the longer they wait, the worse it's going to get.