Why do we take…

Many other countries, US included, have higher gross and per capita debts.

Yes, but they aren’t bankrupt. At least not yet.

—

Besides the fact that most of S. Europe have “submerged economies” (where fiscal fraud is commonplace – eg Spain, where I know MANY people, including myself, who are “employed” without the bosses paying SS taxes),

That is why the EU is on the verge of a Great Depression.

—

there has been a deliberate “run” on sovereign debt in the EU. I am tempted to think that the US is behind it since it behooves the US to prop its primary tool for neocolonialism (the dollar).

It isn’t the US, and isn’t deliberate. That is what the market does to entities when they go bankrupt.

—

Greece, with the help of US auditing companies, indeed fudged its figures and hid its debt. Nevertheless, it is far from being bankrupt.

No, they are toast. They are flat out bankrupt.

—

At any rate, the term “caveat emptor” should apply to speculators of sovereign debt. Otherwise, we have a “socialization” of speculation wherin the speculators are protected at the cost of taxpayers.

Many European banks hold Greek debt under the assumption that as a Euro nation they would never ever default. Many of those banks also do not have insurance on that debt (though some do). When their supposedly safe and secure bonds go up in smoke, you could see a lot of European banks fail.

Worse, all EU sovereign debt is currently valued as if it were default-proof. When Greece defaults and the market wakes up to the fact that it isn’t default proof, *all* EU sovereign debt is going to drop in value.

That means that banks that don’t even invest in Greece, but invest, say, in bonds from Belgium and Germany, will see the value of their assets suddenly drop.

And worse yet, these banks depend on short-term one-day loans to operate. When the value of all EU debt drops, the people who give these short term loans will see these banks as having a less secure balance sheet, and will charge the banks higher interest rates, and the need to pay higher interest rates will weaken the banks even further. You will likely see a number of European banks plunge into a death spiral leading to insolvency, even if they do not even have any investments in Greece.

And if that isn’t bad enough, the banks that survive will suddenly become risk averse and will try to shore up their balance sheet. And that translates into no more loans for business even if it is a solid loan, resulting in a huge economic slowdown across all economic sectors.

End result: Great Depression

—

No, last week the EU made a half-hearted intent to go half-way with regards to the concept of soverign debt. Greece (and others) have been asked to pay for an “odious debt”, and it is logical that tremendous harship should go through the democratic process.

There was nothing half-hearted about it. They went to great lengths to rescue Greece, and Greece just double-crossed them.

That odious debt is debt that the Greeks imposed on themselves. Greece has no one but themselves to blame for the mess they are in now.

—

Are you a Republican by any chance?

Nope. Still a Blue Dog.

Though after the 2008 Michigan Primary, I may well be voting for Republicans for the rest of my life.

I’ll vote for Obama over a monster like Perry though, should Perry get the nomination.

—

Neoliberalism is the core problem in this case. As it is with most aspects of our worldwide crisis.

No, the core problem is Greece’s inability to spend within their means.

—

Yet – who is behind the run on sovereign debt?

It’s what the market always does to bankrupt entities.

—

Why the ideologically-driven drive for “fiscal austerity” when it is patently clear that deficit spending is the most painless way to weather an economic downturn? It goes back to Norquist and Co. and the neoliberal economic ideology.

Deficit spending is indeed the way to go. But it is only allowed for entities that are not already bankrupt.

—

Financial institutions fucked up. They did so because they weren’t regulated, and they weren’t regulated because they paid good money to avoid regulation. Now Greece, and probably the world, has to pay for their irresponsible greed.

Financial institutions are not responsible for Greece racking up a debt they cannot pay.

—

Marxian historians hold that it’s economics that drive history.

After WWII, Greece was the scene of a proxy Cold War battle between the Commies and the West. Believe me, it wasn’t religion or ideology behind the battle – it was the presence of tremendous poverty that allowed the communists to challenge capitalism in Greece.

To allow ANY country to fall into poverty is to invite disaster. Almost all of today’s international problems can be attributed, directly or indirectly, to economic injustice. To wish poverty for the Greeks because their former rw government was corrupt and incompetent (with the help of US auditors), is both inhumane and idiotic (because it would probably blow up in the face of the West).

Greece is going to sink into a black hole. The Europeans just gave Greece their ONLY chance of avoiding oblivion, and Greece just torpedoed the deal.

Now it doesn’t matter what anyone wishes. Greece is done.

All the Europeans can do at this point is decide if they want to sink into the black hole along with Greece, or whether they want to use the money that would have rescued Greece to instead rescue the rest of Europe (note the domino effect leading to a Great Depression I outlined above).

At this point it’s economic triage, and Greece can’t be saved.

—

Germany, which is something of an economic leach run by a rw leadership, doesn’t want to help Greece.

No kidding. Why would they want to blow all their hard-earned money on endless bailouts just so Greece can spend endlessly without consequence?

—

Germany produces, but Germans don’t spend (consume).

I like their work ethic. If I ever found myself starting a company (something I don’t ever expect to find myself doing, but for the sake of argument…), I’d set it up in Germany instead of in the US.

—

Uzi, things are NOT black and white. EVERY side uses propaganda and spin. Until you realize this (with regards to Greece, Italy, Israel, Palestine and the US), you cannot but be a bot.

No, some things are very much black and white. There is good in this world, and there is evil. And there is no moral equivalence between good and evil.

It is a fact that Greece ran themselves into bankruptcy.

It is a fact that Italy intentionally framed Amanda Knox, and it is a fact that they knew she was innocent when they did so.

It is a fact that Israel tried to make peace, that the Palestinians refuse to make peace, that Israel is only defending themselves, and that most of the supposed Palestinian deaths are fictitious.

—

Open your eyes, dude! You’re a bright fellow – and remember that you’re an American by accident of birth and might have been born a Palestinian, Greek or Italian under different circumstances.

Could have been German. My ancestors came to Michigan from some place called Frankonia (did I spell that right?). Modern times, what was once Frankonia is now the Nuremburg Metropolitan Area.

I have a great uncle who was shot down in a B-17 over Germany in WWII. Had a guard with the same family last name at the POW camp. He never made any attempt to see if he was a cousin or anything though. He was afraid that if they really were related, the guard would face negative peer pressure from the other guards because of it, and would try to eliminate that pressure by being extra hard on him to eliminate suspicion. He never did find out if it was a relative.