Debt Rattle February 8 2015
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DPC New Orleans milk cart 1903 • Tsipras Scrambles to Find a Way Forward for Greece (Bloomberg) • Europe’s Revolt Isn’t Just In Greece Or Spain (Marke
[See the full post at: Debt Rattle February 8 2015]I recall that between 2008 and 2010 Germany was reported to print a vast hoard of New Deutsche Marks. I assume that exists, as much as the new $100 bills eventually came out in the US.
Does Greece have Drachmas? Where are the Drachmas? It seems necessary to have some piles of them ready for distribution, doesn’t it?
Things are getting very tight, and completely speculative. This could be a Mexican standoff where everybody pulls the trigger at the same moment.
A step-down of unpayable debt, without eviscerating real economy, is needed.
TPTB are seemingly choosing catastrophic collapse, or at least bluffing quite convincingly.
https://www.zerohedge.com/news/2015-02-07/greece-gambles-catastrophic-armageddon-europe-warns-it-only-has-weeks-cash-leftPetrodollar Dead? What’s Plan-B?
https://www.zerohedge.com/news/2015-02-07/death-petrodollar-was-finally-noticedFarrell’s doing a bit of fear-mongering in his piece. We don’t need to feed people who don’t exist. He could learn something from Daniel Quinn.
John Day,
On a timeframe of a decade or less, the real economy is going to get eviscerated anyway. Debt forgiveness is a good idea because it gives people a chance to adjust to new ways. Whether many will take advantage is unlikely.
As Michael Pettis writes:
“In fact, the current European crisis is boringly similar to nearly every currency and sovereign debt crisis in modern history, in that it pits the interests of workers and small producers against the interests of bankers. The former want higher wages and rapid economic growth. The latter want to protect the value of the currency and the sanctity of debt.”
Hmm..that sounds like what has been said in this blog many times. But I may interject that the “value” of their currency is protected by their guns. We are all captivated by what is happening in Greece. I can’t help think what John Perkins said (Confessions of an Economic Hit Man): (sic) If the country and/or its leaders don’t play by the bankers’ rules, they bring in the jackals. If that doesn’t work, they bring in the armies.
In other words, when you begin to play footsie with the IMF, you need to know the game you’re playing. I am eager to see if the new rockstar leaders in Greece are able to break the shackles of debt and start a just, fair-trade economy, or if the “dog will go back to its vomit” and start the debt slavery all over again.
I also had to stop and ponder these words by Michael Pettis:
“First, as long as Spain suffers from its current debt burden, it does not matter how intelligently and forcefully it implements economic reforms. It will not be able to grow out of its debt burden and must choose between two paths. One path involves many, many more years of economic hell, as ordinary households are slowly forced to absorb the costs of debt — sometimes explicitly but usually implicitly in the form of financial repression, unemployment, and debt monetization. The other path is a swift resolution of the debt as it is restructured and partially forgiven in a disruptive but short process, after which growth will return and almost certainly with vigor.”
But as I just said, will they, whether it is Spain, Greece, Portugal, (insert just about any country you wish) earn the growth, or borrow it? That is the question.
@ Ken Barrows,
Yes, of course the economy based on fairly unlimited and growing use of cheap resources is doomed in the near term. The graph from “Limits to Growth” places the peak of industrial output, food per capita and service per capita in 2015-2016.
What about the transition happening now, this month, this spring 2015?
Can Greece use the ELF funds up to 2/16/15 to distribute through banks as cash Euros? What is that total, EU 59 billion?
What is the transition out of the status quo? The actual transition in all things such as this is critical.
It will take some form. I vote cash-in-hand NOW.The US response to European financial crisis, not appreciated by anybody in Europe, seems to be to ramp up the war in Ukraine, creating a military/humanitarian crisis.
https://www.zerohedge.com/news/2015-02-08/europe-fractures-france-pivots-putin-cyprus-offers-moscow-military-base-germany-us-s
That seems like the wrong plan, “counterproductive” in the openly stated German view.The Lavrov thing makes me sick with worry. Brings to mind the families who packed a picnic to sit on a hill and watch the opening battles of the US Civil War. Because that worked out so well. Or, as perennial diplomat and resident owned-man Gorbachev said, “Are you out of your bleeping minds?” Europe seems to be finally cottoning on to the fact that, yes, the Yanks are out of their crack-addled minds. Or their leaders are, anyway.
For a smart guy, Farrell is often a dunce. Hear the quote “The world has enough for everyone’s need, but not enough for everyone’s greed” by ye olde Mahatma? Yes, well the U.S. alone wastes more than 40% of its food–and I think that’s even after it leaves the farms. 3,000 mile Caesar salad? Yeah, cut that stuff out and it’s no problem to feed 7 billion. It’s well-proven that intensive farming, say 1 human/acre radically increases yields as much as 8-fold. That’s not limited just to nice areas, as mob grazing radically increases yields in east Africa, just for one example. Mixed permaculture is also a win there, but is generally outlawed by the imported European culture via the law.
None of this is with GMOs either, which generally have been proven to have LOWER yields, and HIGHER costs, like pesticides, than their non-GMO, or even open-pollinated, counterparts. So Cargill is the exact last person you’d want to talk to to improve any of this. They ain’t paid to make YOU money, as many farmers have already discovered to their destruction.
Sobering that with such simple solutions, we actively want starvation, hardship, and war.
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