World economies prepare for panic after Greek polls

[dipsydoodle]

Source: Reuters

(Reuters) - Authorities in the world's major economies are preparing for a possible market storm or public panic after cliffhanger Greek elections this weekend, officials said on Thursday, should radical leftists win and cast doubt on the nation's future in the euro zone.

Britain announced on Thursday it would flood its banking system with cash as the euro zone's crisis casts a "black cloud" over the nation's economy.

Officials from the G20 nations, whose leaders are meeting in Mexico next week, said that central banks were ready to take steps to stabilize financial markets - if needed - by providing liquidity and prevent any credit squeeze after Sunday's election. Canada is "ready to act" if the situation takes a serious turn for the worse of there is "an external shock," Andrew MacDougall, a spokesman for Prime Minister Stephen Harper, said on Thursday.

In Europe, authorities also laid plans for tackling turmoil such as if Greeks emptied their bank accounts should the SYRIZA party, which has promised to tear up the country's bailout deal with the EU and IMF, score a decisive victory on Sunday.

http://uk.reuters.com/article/2012/06/14/uk-eurozone-idUKBRE85805E20120614

Read more: http://uk.reuters.com/article/2012/06/14/uk-eurozone-idUKBRE85805E20120614

[Passport1]

1. Radical Leftists?

To say that some leftists are radical asserts that some leftists are not. This clearly cannot be as all leftists from their beliefs are radical.

What is happening in Greece are the cumulative effects of liberal/progressivism/socialism beginning its predictible decay. It never works, cannot work and always ends badly.

[OffWithTheirHeads]

2. 5,4,3...

[dipsydoodle]

3. Enjoy your stay

[Art_from_Ark]

5. Passport's already got PPR'd

One of the shortest stays on record

[dipsydoodle]

18. Indeed

I'd gone to bed, I'm UK. and thought I might find that this morning. I'm more switched to spotting these things these days - I used to think that some were simply weird.

[Major Nikon]

4. ...

[gregoire]

8. Wow that was wrong.

So very wrong. The problem is that the Greek government isn't spending enough money to stimulate the economy. The idea that the poor and most vulnerable should be punished is ridiculous. You austerity people are no better than Nazis with your persecution of people because of their monetary status. The only difference between austeritism and Nazism is the target of the hatred of people like you. Hopefully one day the talk of austerity will be outlawed just as sensible countries have now outlawed Nazis.

[Ebadlun]

9. That and their dreadful tax-collection

[grantcart]

38. Greece's problem is structural and has nothing to do with austerity

They have been over borrowing for decades and now have a deficit that cannot be paid back.

They have the lowest tax contribution percent as a part of GNP of any country in Europe.

This is due to the fact that they have massive tax fraud and rich local tax accessors that in many instances collect zero taxes but accept personal payments.

How can an entire nation of self employed pay virtually no tax (employees cannot cheat and pay the taxes).

You start with a constitution, not a law but a constitution, that gives one sector (shipping magnates) complete and total tax free income. Shipping billionaires pay not one penny in income tax. Capital gains in their stockmarket are also tax free.

Once you have an unfair tax system then everyone who can cheat will. This is the real reason why the Bush Era tax credits for the rich must end, they create an unfair platform and people not making millions feel they have a right to cheat.

The Greek debacle is many things, it is not a testament to the problems of austerity. Technically the Greek government has been over stimulating the economy for years, they just want German and French workers and their pensions to pay for it.

[lovuian]

6. I saw someones comments who just visited Greek relatives

Greece Airport is empty
people eating out of trash cans

and the people are going to vote for opting out of the Euro

It is all ready in the works
as you can see

You have seen Iceland and next you will see Greece

[dkf]

7. I hope they have hoarded a decent amount of canned goods and medical supplies.

Scary.

[Mojorabbit]

13. All of this makes me nervous

If this dominoes anything can happen globally

[dkf]

14. Personally I think the Germans want the Greeks out.

Then they will use it as leverage to convince the German people to do what must be done.

Greece is Lehman. Without it they can't move forward.

But the people of Greece are going to be in a world of hurt. I heard an analysis that Greece might have to be assisted to prevent famine type disaster.

Then Europe will enter what Japan has been in...a lost decade of no growth.

[JDPriestly]

16. Do you think that any economies other than those in the very poorest nations

will see any growth over the next five years? If so, which ones?

[dkf]

17. China, India...other emerging countries.

They are starting to see enough domestic consumption to keep them growing.

[magical thyme]

27. not according to what I've read....nt

[4th law of robotics]

30. Maybe, but so much of their economic growth is tied to us buying their junk

the slowdown here is hurting them as well.

It's hard to have an export based economy when no one is buying and transition to a domestic based one won't be easy given how they've structured their entire economy.

Also China is in for a world of hurt in the next few decades as A) the one child policy + ingrained sexism leaves them with a surplus of angry males and B) they undergo a massive demographic aging that makes our baby boomer woes look like a blessing.

[dipsydoodle]

19. It may ultimately be to their advantage

to move away from repayable bailout support to non repayable international aid. Currently their income from tourism , which is a mainstay of their economy , is 15% down. IF they do go back to the Drachma their level of tourism will go through the roof.

[dkf]

20. Depends...if there are riots and general unrest they will have no tourists.

International aid comes with the austerity they are rejecting so those funds might not be there either. It will probably have to be humanitarian aid...food and medicine aid. Certainly nothing like a pension.

[dipsydoodle]

21. Its the riots and general unrest

which have caused the 15% reduction to date. To date I don't think that has afffected the islands - fortunately.

I don't think that international aid by way of gift would necessarily have such strings attached.

[dkf]

22. They are covering everything in graffiti too.

http://www.democraticunderground.com/101631970

That is not helpful for tourism.

[RandiFan1290]

23. Graffiti? How gauche.

If only you could convince them that tax cuts for the wealthy are the only answer!

[dipsydoodle]

24. When I posted that I found it odd that Reuters didn't post any examples

In some respects graffiti is an art form and as such wouldn't put me off personally. I doubt their efforts approach Banksy's work.

Attributed to Banksy :

[suffragette]

39. That's been occurring for centuries by Greeks and tourists both

Lord Byron seemed fond of etching his name in stone everywhere he went. (I've seen his name carved into a pillar in a Swiss castle - Chillon.)

Byron's and others graffiti on Temple of Poseidon
http://www.athensguide.com/sounion/lord-byron.htm




A political example from history:
http://www.ahistoryofgreece.com/post-war.htm
On May 22 1963 Lambrakis goes to Thessaloniki to address a rally of his followers, despite death threats. After the event, he is attacked and killed by hired thugs in plain view of the police. The killers turn out to be members of a secret right-wing organization used by the authorities for such purposes. Lambrakis falls into a coma, and dies a week later. A young magistrate named Christos Sartzetakis is given the job of prosecuting the case in the belief that he is a good soldier and will accept the government line that this was an accident. Sartzetakis however, aggressively investigates the incident and discovers a conspiracy within the police. He indicts a number of police officials despite attempts by the government to intervene and get him to call it an accident and blame Lambrakis' people for inciting a riot. All over Greece the letter Z appears as graffiti.

And Time has a collection of current "Protest Graffiti Art in Athens"
http://www.time.com/time/photogallery/0,29307,2099542_2322652,00.html


I found some thoughtful pieces here with images of both old and new graffiti in Greece. Note how much of the old came from wealthy tourists visiting Greece:

http://melbourneartcritic.wordpress.com/tag/greece/

http://melbourneartcritic.wordpress.com/2010/05/31/athens-graffiti/
Back to the contemporary graffiti in Athens. With the economic collapse and the riots this year and last year in Athens it doesn’t look like anyone can afford to buff, or paint over, any of the graffiti. Anarchy symbols, tags, bombs and other marks cover every second building, it is all along the metro lines and on the metro cars (although the metro stations themselves remain untouched).


Seems to me it's a combination of long tradition combined with current lack of funds to pay for removal of what typically would be removed.

[dipsydoodle]

41. Thank you for posting those links.

[suffragette]

42. And thanks for all your posts keeping us informed across the pond

I don't always reply, but I always appreciate them.

[Art_from_Ark]

11. The difference between Iceland and Greece

is that Iceland has a much smaller population (320,000 versus 11 million), and had its own currency during its recent financial crisis. Ironically, Iceland is considering joining the Eurozone, but as of April 2012 a little more than 53% of the population opposed joining the Euro.

http://en.wikipedia.org/wiki/Accession_of_Iceland_to_the_European_Union

[magical thyme]

26. another major difference

Is that Iceland didn't suffer through however many years of austerity first.

Greece is like the bull that has been bled before the matador. Had they left very early on, they would likely be through the black hole by now and coming out the other side.

[suffragette]

40. "Greece is like the bull that has been bled before the matador."

Apt description of the situation.

[Sgent]

44. Probably the biggest difference

is that Iceland incurred a one time debt related to the financial crisis. Greece has been running huge deficits for years -- much higher than the EU allows -- and wants other countries to continue to fund their social welfare state.

Essentially, Germany and France have said no. This leaves Greece in an unenviable position of either letting the EU set their fiscal policy, or going it alone. The only leverage they have is psychological -- that it will hurt the EU if the leave.

It sucks, it really does, but they're picking from the hell you know -- austerity, and the hell you don't -- leaving the EU. Leaving the EU will probably be worse for the Greek people, at least in the short to medium term.

The third option proposed by some of the opposition parties is equally untenable -- don't implement austerity, but stay in the EU. This essentially means a government shutdown (or nearly so), and a cease / cut of all welfare payments, etc. The austerity measures imposed by Germany are less drastic than this option.

[Art_from_Ark]

46. I was talking to a Japanese businessman the other day

who said the Eurozone was comprised of "ant and grasshopper" countries, with Greece and other Mediterranean countries playing the role of the grasshopper.

[iandhr]

10. Seems like the Greeks are ****** no matter what happens.

[BadGimp]

12. Just what we need now...

FUD

Fear
Uncertainty
and
Doubt

[entanglement]

15. More bad news - Yields on Spanish 10-year bonds exceeded 7% today.

[link:http://www.nytimes.com/2012/06/15/business/global/daily-euro-zone-watch.html|

[magical thyme]

25. why do they always flood the banks with money?

Why not flood the people, so they can buy the things they need instead of going hungry, without medicines, in rags? Or pay down their debts and free up their earnings over the long run?

[4th law of robotics]

31. What money?

The greeks are out.

[magical thyme]

32. the UK is planning to flood its banks with money

if Greece leaves the Euro.

The UK has been doing their own austerity thing, deepening their own recession too.

As far as Greece, I don't know what they can do at this point...

[Prometheus Bound]

43. As I understand it, they do it to ensure banks can keep lending to businesses.

But the problem in the UK, and I suppose elsewhere, is that businesses don't want to borrow more because there is no point in expanding when the economy is depressed. So it would seem you're right, that it you want the economy to expand, you should put more money in the hands of the people, especially those at the lower end of the income ladder since they are most likely to spend it all and keep the economy moving.

[slackmaster]

28. ASSUME CRASH POSITIONS!

http://1.bp.blogspot.com/-zAYJC_whrHA/T4z93G675JI/AAAAAAAAAJw/hdkG89txcPU/s1600/airline+ad.jpg

[dipsydoodle]

29. In my dreams

[may3rd]

33. A minuscule economy made up of a population that refuses to pay taxes and a govt that accepts

bailout $$,
only to have the next elected govt refuse to repay the bailout.
Yes
It's a classic a Greek Tragedy .

...and all the worlds a stage

This will hurt them far more than it does us

[GliderGuider]

34. Yeah, how much damage can knocking over one tiny domino do, after all?

[bemildred]

35. I think it means "World governments", economies don't have volition. nt

[DCBob]

36. Panic?? I doubt it.

Most have been predicting/expecting/hoping for this to happen for a long time.

[otherone]

37. radical leftist!

[truthisfreedom]

45. Lucy, you got a lot of Spainin' to do.

The rain in Spain falls mainly on the Dow Jones Industrial average.