Default experts: the Greek sovereign debt gods

[dipsydoodle]

(Reuters) - When a bankrupt Mexico stopped repaying foreign loans in 1861 after three years of civil war, Great Britain, France and Spain responded by invading the Mexican harbour of Veracruz.

Britain and Spain pulled back almost immediately on promise of future payment. France invaded, installed an Austrian as emperor, and was not driven out for another six years.

Since the second Hague Convention of 1907 banned the use of violence to collect debt from other countries, recouping sovereign debt has called for a very different kind of diplomacy: the generals now orchestrating repayments are a rare breed of specialist lawyers, academics and fund managers.

And as an intellectual battlefield, Greece is as good as it gets.

http://uk.reuters.com/article/2012/02/16/uk-greece-debt-experts-idUKTRE81F10720120216

[DCKit]

1. Greece to the Generals: "Goldman Sachs stole all our money." nt

[dipsydoodle]

3. That isn't quite case.

The issue revolves around the extent to which Greece should've borrowed regardless of who from. They've been doing so to support a size of government and public sector out of all proportion to their GDP and the size of their population @ c. 10,000.000.

The population in general have been totally unaware of what's going on which is part of the reason this is hitting them so hard.

[fasttense]

2. The American, Germany and EU banks have declared financial war on Greece

We're suppose to be glad that the banks didn't make us go to real war?

Oh just look at the geniuses who are working on this debt restructuring. They are so smart they have started the worst riots in Greece history in over a century. They are so smart they have caused over 40% unemployment in the 16 to 25 year olds. If they were the geniuses Reuters seems to think they are, then they wouldn't have dumped on the most aggressive, and physically active group of people in the country. When 16 to 25 year olds have nothing to do, and nothing to lose, they tend to cause severe disruption.

Reuters acts as if it's all the country's fault. But let me ask you, why do banks, since 1861 apparently, loan money to countries that are such very bad risks, over and over again? Are they really that dumb? Or do they push and con, (perhaps even bribe some politicians) countries into what look like good loans?

And at the heart of most of these supposed sovereign bankruptcy is corruption.

[polly7]

4. Just a bit more of what they're facing ..

http://energybulletin.net/stories/2012-02-16/eu-greece-capitalism-has-persuaded-world-capitalism-world

The ‘austerity package’, as the newspapers like to call it, seeks to impose on Greece terms that no people can accept. Even now the schools are running out of books. There were 40% cuts in the public health budget in 2010 – I can’t find the present figure. Greece’s EU ‘partners’ are demanding a 32% cut in the minimum wage for those under 25, a 22% cut for the over 25s – the minimum wage in Greece is around €500 per month, well below a living wage in that economy. Already unemployment for 15-24 year olds was 43.1% last April – it will have risen considerably since then. Overall unemployment has increased to over 20%. The sacking of public sector workers will add to it. The recession predicted to follow the imposition of the package will cause unbearable levels of unemployment at every level.

In addition the ‘package’ demands cuts to pensions and public service pay, wholesale privatisation of state assets – a fire-sale, since the global market is close to rock bottom – cuts to public services including health, social welfare and education. The whole to be supervised by people other than the Greeks. An entire disciplinary and punishment system.

http://zcommunications.org/greece-from-despair-to-resistance-by-panagiotis-sotiris

Under the terms of the new agreement the following drastic changes are going to be put to vote:

· The minimum wage, which up to now was determined under the terms of the National Collective Contract signed by the Trade Union Confederation and the Employers Associations, is going to be reduced by 22%. For new workers under 25 the reduction is going to reach 32%. This is going to immediately affect around 25% of total workforce in Greece. Moreover, wage maturities (the increases in wages according to the years of workplace experience) are going to be frozen.
· This reduction is also going to affect all other private sector employees covered by collective contracts and agreements. With most contracts having reached or reaching their end, with a new system of collective bargaining and mediation in place that openly favors employers, the terms of the new agreement demand that also individual terms of employment are going to change leading in most sectors to wage reductions of up to 50% (until now even when a collective agreement expired individual contracts signed under its terms could not be altered). These wage reductions are going to be devastating, taking into consideration that drastic reductions in public sector pay have already been imposed and that labour cost in Greece is already down by 25%, helped by unemployment having reached unseen before levels (the official unemployment in November exceeded 20%).
· All pensions are going to be reduced by more than 15%, a reduction that is following other reductions that had been earlier imposed. Moreover, the terms of the agreement demand a new overhaul of the pension system paving the way for more reductions and raising of age limits. Pension reductions are not only going to affect the living conditions of older people but will also limit inter-generational solidarity, a crucial aspect of social cohesion in Greece.
· All forms of social spending are going to be drastically cut including funds for hospitals and health coverage and social benefits. Since hospitals are already in critical condition because of earlier cuts, this new wave of cuts is expected to lead to a dramatic deterioration of health services in a country that is already facing deteriorating health indicators.
· A new wave of privatizations is demanded, including the sale of crucial infrastructure such as airports and seaports and full privatization of public utilities.
· A new wave of lay-offs of public sector employees is going to be implemented, helped by a wave of closures of public institutions, including primary and secondary education schools, university departments and agencies such as the one responsible for public housing. Moreover, terms of employment in Public Utilities (partly owned by the State) and Banks are going to change, with all provisions for secure employment eliminated, leading to another wave of mass lay-offs.

[nolabels]

5. The reason they loan the money is if don't loan the money they will loose it one way or another

These bankers also have a treadmill they live on, we are just a bunch of conditioned rats that really doesn't know much better or can't get out of our own way. Some at the top of pyramid might know better but mostly, we, the conditioned rats, have no choice or know not.