Is the European Central Bank taking the piss?

[Filo]

£1b of UK taxpayers money could go towards propping up the Euro

http://news.sky.com/story/1518285/britain-may-face-1bn-bill-for-greek-rescue


I hope our Government put a stop to this, the Greek crisis is mainly a German and French problem

[Donnywolf]

Where is IC when you need him ?

[wilts rover]

Seems like he's hacked Filo's account.

Best not tell him that Greece already owes us £10.8 billion already or we might get the armoa of boiled piss going again too...
http://www.bbc.co.uk/news/world-europe-33407742

[Glyn_Wigley]

Typical billshut EU scare story that'll not come true, just like all the other ones.

[BRMC_rover]

Id prefer Greece to do what they need to for their peoples sake and not be bullied into propping up the house of cards, that is the financial services roulette of the Euro. Their people didn't act irresponsibly, therefore the people's next generations should not be subject to working (those lucky enough to still have employment) to pour their cash into Brussels. The conditions offer no stimulus for recovery and their own state services would be in the hands of foreign ownership, funded by Greek tax, yet profits going outside of Greece. It's a real mess and created through greed and Angela Merkel's inability to admit that some members cannot operate under the EU's ideal.

Id be happy to say goodbye to the 10.8b tax we contributed if it the alternative contributes to subjecting generations of Greeks to poverty.

[BillyStubbsTears]

BRMC

Post of the year.

I used to read about the utter f**k ups that were made at Versailles, and about the Gold Standard in response to the Wall St Crash, and think, "Hiw could politicians and electorates have been so utterly stupid, vindictive and blind to the consequences of what they were doing? Why could they not see that deliberately crashing other countries' economies, and insisting against all evidence that utterly mad economic policies was undermining international and domestic stability?

It was so bleeding obvious. Surely we'd never do it again?

And here we are. Doing it all over again.

What Germany and the German-inspired ECB has done to Greece this last couple of weeks is utterly abhorrent. They were the ones who said to Greece in 2010 that if they followed the Austerity path, they'd have 12 months of hardship, then bounce back. Greece did exactly as it was told. It stayed in the Euro and didn't default. If it HAD done, Europe would have gone through another Great Depression. Greece took bailouts to pay off German and French banks who had loaned them mad, mad sums of money. So the banks' debt was transferred into debt owed to EZ taxpayers instead.

That saved the banks and the banking system. But by following Austerity to the letter, Greece's economy collapsed by 25%. And NOW Germany says that because  Syriza tried saying "no more!" Greece cannot be trusted!

And what does Germany now insist on? Even harsher Austerity piled on top of an economy that has already been crippled by Austerity. And to put the bullets in the gun aimed at Greece's head, the ECB deliberately and knowingly crashed the Greek banking system. The main purpose of a Central Bank is to provide liquidity in a banking crisis. The ECB deliberately pulled that liquidity precisely to bully Greece into accepting the German terms. Terms that are on a par with those that are normally dictated by victors in a war.

It is an absolute f**king disgrace and we should be up in arms about it. If we end up paying £1bn to support Greece, it is the least we should do, not least because the previous mendacious Greek Govts only got away with their insane borrowing that precipitated this crisis because a London based merchant bank helped them to fiddle the books.

[BobG]

Thank you you two. Your two posts should be preserved. For all time.

Merkel has become a danger to us all.  One of the scarcely considered possible consequences of what she has insisted upon is the complete poisoning of relations between Greece and the EU. That may not matter too much right now. But it will. It will. And when it does, just who does she think is waiting in the wings, ready to offer a hand of 'friendship' to Greece? We've already seen the overtures. Stout effort by the Greeks to resist. But for how much longer? Economically, politically, the risk has just grown exponentially. Merkel is now risking more than economies.

BobG

[Filo]

Merkel is the new Fuhrer!

[Savvy]

BRMC

Post of the year.

I used to read about the utter f*** ups that were made at Versailles, and about the Gold Standard in response to the Wall St Crash, and think, "Hiw could politicians and electorates have been so utterly stupid, vindictive and blind to the consequences of what they were doing? Why could they not see that deliberately crashing other countries' economies, and insisting against all evidence that utterly mad economic policies was undermining international and domestic stability?

It was so bleeding obvious. Surely we'd never do it again?

And here we are. Doing it all over again.

What Germany and the German-inspired ECB has done to Greece this last couple of weeks is utterly abhorrent. They were the ones who said to Greece in 2010 that if they followed the Austerity path, they'd have 12 months of hardship, then bounce back. Greece did exactly as it was told. It stayed in the Euro and didn't default. If it HAD done, Europe would have gone through another Great Depression. Greece took bailouts to pay off German and French banks who had loaned them mad, mad sums of money. So the banks' debt was transferred into debt owed to EZ taxpayers instead.

That saved the banks and the banking system. But by following Austerity to the letter, Greece's economy collapsed by 25%. And NOW Germany says that because  Syriza tried saying "no more!" Greece cannot be trusted!

And what does Germany now insist on? Even harsher Austerity piled on top of an economy that has already been crippled by Austerity. And to put the bullets in the gun aimed at Greece's head, the ECB deliberately and knowingly crashed the Greek banking system. The main purpose of a Central Bank is to provide liquidity in a banking crisis. The ECB deliberately pulled that liquidity precisely to bully Greece into accepting the German terms. Terms that are on a par with those that are normally dictated by victors in a war.

It is an absolute f***ing disgrace and we should be up in arms about it. If we end up paying £1bn to support Greece, it is the least we should do, not least because the previous mendacious Greek Govts only got away with their insane borrowing that precipitated this crisis because a London based merchant bank helped them to fiddle the books.

"Greece did exactly what it was told to" forgive me if I'm wrong, but hasn't one of the major stumbling blocks to an agreement been the fact that the Greeks DON'T do what they say they are going to? Thought credibility was a major issue here?

[BobG]

Filo - that's not quite as idiotic as it would once have sounded. I mentioned somewhere on here, not very long ago, that, just maybe, Germany is starting to revert to type. Hegemony doesn't have to be always achieved through warfare. In the 20 years since reunification, Germany has comsolidated its position as the major power in central Europe. It has rebuilt the ex DDR. Now, under Merkel, it looks supiciously like Germany has started asserting itself against a weaker state not too far from its borders. Surely we couldn't call it bullying could we?

Poor old Germany. It'll just never live down its history will it? What I've just written is a conspiracy theory gone mad - yet there's always just that little tremor of fear isn't there?

BobG

PS. Later thought: I wonder how this pushing around is faring in the halls of the Kremlin - where it might have done some good. It's obvious to a blind man though, we, the west, Germany included, have gone a very long way towards abandoning the Ukraine. I call that pretty damn shameful too. Especially of this wonderful England. We were one of the 3 powers who guaranteed their borders when the Ukraine agreed to give up its nuclear weapons. Poor sods. Fancy relying on Perfidious Albion....

[BRMC_rover]

I have been starting to wonder what the genuine reasons of the finance minister standing down were. Imagine him suggesting a leftist self recovery programme that completely undermines the authoritarian agenda set by AM. He knew it was impossible. Pm looks as though he's exhausted and all the time the austerity terms are getting more and more shameful.

[BRMC_rover]

Thanks for your insight too BST. Good to read another great observation that isn't from a media propping up the EU.

[BRMC_rover]

BRMC

Post of the year.

I used to read about the utter f*** ups that were made at Versailles, and about the Gold Standard in response to the Wall St Crash, and think, "Hiw could politicians and electorates have been so utterly stupid, vindictive and blind to the consequences of what they were doing? Why could they not see that deliberately crashing other countries' economies, and insisting against all evidence that utterly mad economic policies was undermining international and domestic stability?

It was so bleeding obvious. Surely we'd never do it again?

And here we are. Doing it all over again.

What Germany and the German-inspired ECB has done to Greece this last couple of weeks is utterly abhorrent. They were the ones who said to Greece in 2010 that if they followed the Austerity path, they'd have 12 months of hardship, then bounce back. Greece did exactly as it was told. It stayed in the Euro and didn't default. If it HAD done, Europe would have gone through another Great Depression. Greece took bailouts to pay off German and French banks who had loaned them mad, mad sums of money. So the banks' debt was transferred into debt owed to EZ taxpayers instead.

That saved the banks and the banking system. But by following Austerity to the letter, Greece's economy collapsed by 25%. And NOW Germany says that because  Syriza tried saying "no more!" Greece cannot be trusted!

And what does Germany now insist on? Even harsher Austerity piled on top of an economy that has already been crippled by Austerity. And to put the bullets in the gun aimed at Greece's head, the ECB deliberately and knowingly crashed the Greek banking system. The main purpose of a Central Bank is to provide liquidity in a banking crisis. The ECB deliberately pulled that liquidity precisely to bully Greece into accepting the German terms. Terms that are on a par with those that are normally dictated by victors in a war.

It is an absolute f***ing disgrace and we should be up in arms about it. If we end up paying £1bn to support Greece, it is the least we should do, not least because the previous mendacious Greek Govts only got away with their insane borrowing that precipitated this crisis because a London based merchant bank helped them to fiddle the books.

"Greece did exactly what it was told to" forgive me if I'm wrong, but hasn't one of the major stumbling blocks to an agreement been the fact that the Greeks DON'T do what they say they are going to? Thought credibility was a major issue here?

The big issue was the failings of austerity. The bail out, went to the banks that support their economy, not into investment or budgeting of public services. While cuts further depleted the foundations of recovery. The Greeks did do as they were told. The austerity forecast for recovery, just like Osbourne's in the UK, was just way off. They realised that they could continue with austerity for 1million years, but year of year they will go backwards.

[BRMC_rover]

Filo - that's not quite as idiotic as it would once have sounded. I mentioned somewhere on here, not very long ago, that, just maybe, Germany is starting to revert to type. Hegemony doesn't have to be always achieved through warfare. In the 20 years since reunification, Germany has comsolidated its position as the major power in central Europe. It has rebuilt the ex DDR. Now, under Merkel, it looks supiciously like Germany has started asserting itself against a weaker state not too far from its borders. Surely we couldn't call it bullying could we?

Poor old Germany. It'll just never live down its history will it? What I've just written is a conspiracy theory gone mad - yet there's always just that little tremor of fear isn't there?

BobG

Exactly Bob. Too post.

In humans their are flaws. Some of those humans with flaws happen to have responsibility over many peoples welfare.

[The Red Baron]

Interesting that the IMF think the deal is a crock. It wouldn't be too surprising if the Greek parliament votes against.

I think Tsipras has made some bad moves, but equally he has been hung out to dry by Merkel and co. Maybe they would be glad to be rid of a self-confessed leftist, but they may end up with worse.

When I looked at the details of the deal I thought  "I'll give it six months" before the next crisis. I think I was overly optimistic.

[BillyStubbsTears]

Savvy

Greece has made quite astonishing budget cutbacks. Just as they were told to do by the Troika in 2010. They were assured that the effect of this would be a hard but short recession followed by growth. Because the people who were "assuring" them of this got the economics horrifically wrong, they have actually had what looks like at interminable Great Recession.

The "trust" issue is now being flagged up because  Syriza came onto the scene saying "we are not prepared to continue with this economic madness". And the response of the ECB, egged on by Germany, has been to go nuclear by effectively crashing the Greek banking system and forcing Syriza to surrender.

The scale of the catastrophe that has been visited on Greece, and of the sheer incompetence of the Troika's original plans is barely credible, as these graphs show. Look how their projections were hopelessly optimistic about the effect that Austerity would have on the Greek economy.


And a more recent one.


So at every step of the way, the Troika has said "More Austerity and you'll be OK". And look what has happened.


And this isn't some academic exercise. This is the futures of an entire population being consumed by flames.

For the Troika now to talk about "trust" is a sick joke. Greece's previous, pre-2010 Govts were feckless and reckless. But my God have the Greek people been made to pay for it.

And NOW Merkel has been saying that the solution is more of the same. Because she doesn't care about the economics. She's playing to her domestic electorate who have been misled about the scale of the crime that they have committed against Greece. She can't say "we were wrong". The IMF has done though, and now we really are at the crunch point.

Someone got it bang on this week. They said that the tragedy imposed on Greece, relative to their original crime is the equivalent of the Victorians hanging kids for stealing. And it's done for exactly the same reasons. To satisfy the bloodlust of the onlookers and to terrify anyone else who may step out of line.

[The Red Baron]

Point of information: The Victorians did NOT hang children for theft. Such things did happen in the 18th century (I.e the 1700s) but by the time Victoria came to the throne the death sentence was routinely commuted for all but serious or persistent offenders.

The Victorians were also responsible for legislation which reduced the number of offences carrying a capital sentence- basically to treason and murder.

You can accuse the Victorians of many things, but hanging juveniles for minor crimes was not one of them.

[BRMC_rover]

Great post BST. Enjoying how informative and engaging this thread is.

[BillyStubbsTears]

TRB

Oops! Apologies to the Victorians

[The Red Baron]

TRB

Oops! Apologies to the Victorians

BST

I realised you were quoting someone else, but there is a big misconception about "the Victorians." By today's standards, of course, they appear brutal and hard. But many of the social reforms whose benefits we enjoy today started in the Victorian era and then were carried on in the 20th century.

[wheatleylad]

The Greeks have only themselves to blame. Years of Socialism which created a bloated public sector funded by loans. Tax evasion is a national sport. They are living above their means. As one pundit said , you cannot export tomatoes and import BMWs. They need to leave the Euro , float their own currency and build their economy up by working and paying tax. Why should my tax go to prop up a country which is responsible for its own mess. They should try hard work and realism.

[The Red Baron]

Back to the OP, the ghost of Nicholas Ridley will be smiling a wry smile.

http://www.waspsnest.com/2011/11/19/july-1990-nicholas-ridley-on-the-eu-and-the-germans

[Savvy]

http://www.dailymail.co.uk/news/article-3161585/Europe-tells-Britain-pay-1bn-share-Greek-bailout-Osborne-strongly-opposes-plan-use-money-EU-members.html

What the actual f....!!!!

[Dagenham Rover]

Better cancel the direct debit pdq

[BRMC_rover]

Iv been looking forward to hearing what this fella has had to say about it all and it's a great read, so thought you may want to have a gander too.

http://www.newstatesman.com/world-affairs/2015/07/exclusive-yanis-varoufakis-opens-about-his-five-month-battle-save-greece

[BillyStubbsTears]

Iv been looking forward to hearing what this fella has had to say about it all and it's a great read, so thought you may want to have a gander too.

http://www.newstatesman.com/world-affairs/2015/07/exclusive-yanis-varoufakis-opens-about-his-five-month-battle-save-greece

Read that the other day. Varoufakis is something of a preening egotist, but he's right on the central issue.

The economics is mad and everyone involved knows it's mad. But it's being foisted on Greece anyway because of German politics.

And THAT, in a nutshell, is the core of this monstrous crime that we are seeing played out in front of us.

[BobG]

Thank you BMRC. That is one very, very informative article. It's all really quite scary. Unaccountable, unregulated, un-transparent, un-minuted, underhand even.

When I listened to that Conservative Industry wallah rattling on today about how making sure that 4 out of every 10 who are eligible to vote must vote for a strike for it to be legal, oddly, it reminded me of Greece. Just like Greece, no one understands it. But that 40% threshold is going to cripple almost everyone in this country sooner or later.

Example: a decent turnout in a general election is 70% these days. Turnouts in union ballots are usually less. But lets assume it's 70%. That means that already 3 out 10 votes, effectively, oppose the strike motion. To then achieve a 40% threshold, the remaining 70% of voters must split 60/40 in favour. So, the ballot where a 40% threshold 'is reasonable' actually means that 60% of those voting have to vote yes. If the turnout is 60% (which is a more likely number) then 70& of those voting have to vote in favour.

See what they're doing? Trading on unfamiliarity wih numbers. Trading on pious crap from earnest sounding buffoons like that wally from Industry. We have seen the development of an institutional underclass. This sort of legislation will widen that underclass hugely. We have entered The Ages of the Haves and The Have Nots. The Haves, of course, possess every single ace in the pack. Money, experience, education, nepotism, contacts. It all gets passed from father to son and no bloody hairy arsed outsider is ever going to break in.

I do happen to know something about this. My son, for reasons which I wont go into, goes to a rather expensive private school. It's an astounding place. Really, really astonishing. The facilities, the resources, the experiences, the teaching, the whole damn works are mindbogglingly good. How many of you can afford to pay upwards of 30 grand every year to send one child to school? But that's not the worst of it: When you meet the other children, the parents, it smacks you right between the eyes - well, it does me anyway - just how unbelievably rich, how unbelievably privileged, how unbelievably blinkered, these people are. I feel very out of place in their company. Yet I'm no mug. Nor am I one of the unwashed poor. What chance has the vast majority of the population of this country got in a world where kids like this are going to inherit the earth from their families and the families of the friends  they made at school?

It's effing obscene.

The Labour Party has a lot to answer for.

BobG

PS Is Greece another German war crime....? Conceptually, I suspect yes.

[BRMC_rover]

Something needs to happen with education paths and the cost of entry. It is effectively creating an environment where you need to purchase your right to opportunities. At the same time it is restricting about 90% of the population and blocking the development and unlocking of potential pioneers. Its ludicrous and simply just class wars, which eventually will result in us falling so far behind the rest of the world. We already rely on dodgy arms trade and financial services standing up for us and hardly produce anything, so a restriction of education will send us back peddling whilst young adults plod on within a disenfranchised, dumbed down nation.

Its a greedy, self serving system that eventually eats itself as it offers little room for development.

[BillyStubbsTears]

BMRC

I've noted before that we've had 3 economic periods over the past 100 years.

1918-1939: Massive austerity to pay down the debts of WWI. Obscene imbalances in wealth. Huge unemployment and tiny social mobility. Social fracture across Europe. Collapse of democracies, leading to You Know Who and What.

1945-1976. We had even bigger debts and even bigger devastation to repair. And we did it in a totally different way. Keynesian demand management. Financial repression of the wealthy through high taxes and restrictions on mobility of money. Huge Govt involvement in funding and planning the economy. Strong trades unions to protect the workers. A commitment to full employment and opportunity for the poorer. Effectively a Social Contract. We were all in it together. And we had an economic miracle across Europe. Unprecedented period of stable growth. Unprecedented reduction in debt as a proportion of GDP. Unprecedented increase in productivity and innovation. Low unemployment. Rising living standards across the board. Massive reduction in inequality. Not perfect. Inflation came with it and got out of control in the 1970s, leading to...

1980-?? A reversion to neo-liberalism in economics. Destruction of unions. Acceptance of mass unemployment as an inflation-fighting mechanism. Freeing up of the "wealth creators". The result has been low inflation for sure. But growth that was lower than in the post-War period. Plus hugely unstable economic cycles with two major recessions (1980-83 and 08-??) that were worse than anything in the previous 40 years, and a third (90-92) that was not as severe but still pretty nasty). We've seen wealth imbalances return to the levels of the 1920s. We've seen median earnings stagnate whilst those at the top have exploded. We've seen the banking sector go berserk on its unrestricted freedom and gorge itself on crazy lending, then leave tax-payers to foot the bill and clean up the mess.

It won't stay like this forever. The current model is as broken as the previous 2 were in the late 30s and early 70s.

What scares me is what event it will take to shock us out if this model and into another. There is no sign of a gentle, measured change. There never is. The political establishment has too much invested in the status quo.

Last time, the revolution came through two astonishing, driven and committed politicians who dominated their era. Thatcher and Reagan. The time before, it was the consequence of another, even more astonishing, committed and driven politician that led to the collapse of the system and the re-birth with a new world economic system (although it wasn't the New Order that he had envisaged.)

I'm beginning to think that the catalyst this time will be the break up of the EuroZone, consequent global economic meltdown (because that WILL happen) and the emergence of our equivalent of the 1950s. More Govt control. Less freedom for the rich to do as they wish. Higher taxes and a simple, stable system. It'd be a very different world from today's but it worked after the last time Europe destroyed itself. I just hope that the only destruction Europe sees this time is as a result of economics and not as a result if guns and bombs.

[BRMC_rover]

''What scares me is what event it will take to shock us out if this model and into another. There is no sign of a gentle, measured change. There never is. The political establishment has too much invested in the status quo.''

Exactly. The slow eroding away of society has been a long, doctrined process which I wont imagine those with a vested interest, will give up easily. It doesn't help that the media has such an influence, but more and more people are waking up to the agenda behind the rags.

I think the Greek's may have already started the fall of the EU, as the treatment of them has been nothing short of criminal. The details that are coming out of the so called 'negotiations' each day, prove that there is not negotiation. If your economy does not work as a n EU member, it is now apparent that there is no get out or restructuring. Only a condemnation of your country, asset stripping and clearly, exercising democracy is pointless in its resistance.