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Greece pushed a step closer to Grexit after IMF snub
onecitizen
Posts: 5,042 Forum Member
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If Greece gets away with not paying back its debts I can see Spain and Italy going the same way towards the exit from the Eurozone, which might not a bad thing.
http://www.theguardian.com/business/2015/apr/16/greece-moves-step-closer-to-grexit-after-imf-snub
http://www.theguardian.com/business/2015/apr/16/greece-moves-step-closer-to-grexit-after-imf-snub
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If Spain and or Italy leave the Euro is finished. Hurry up Spain and Italy!!
The Treasury and Bank of England have begun contingency planning for this possibility.
http://www.telegraph.co.uk/finance/economics/11417643/Osborne-demands-Plan-B-as-eurozone-talks-with-Greece-collapse.html
Though they won't reveal what those plans are.
A Deloittes report on a euro collapse provides some illuminating reading
https://www.treasurers.org/ACTmedia/Eurocontingency_DeloitteACT_reissue030112.pdf
Looking at this report confirms my own guesses (for that they are worth!). If the event of a partial or complete euro collapse, the UK government will have to provide near limitless amounts of money to any British company or British bank which has any dealings with any company or bank based in the eurozone.
As with the 2007-8 UK banking crisis, the UK government needs to spend as much money much as necessary to prevent financial panic.
As well preventing financial panic, the UK government will have much else to consider in the event of a euro collapse.
http://www.thisismoney.co.uk/money/news/article-2079260/UK-prepares-euro-collapse-plan-block-rush-cash-push-pound-unsustainable-level.html
Typical UKIP... break everything in order to get your way.
The white hair, the weird grey suit, the oh-so-reasonable manner... Even the name is perfect.
So Lagarde, do you expect us to pay?
No, Mr Greece, I expect you to die!
If this IMF thing doesn't work out for her she could maybe hold the USA to ransom with an orbiting death ray device.
Not really. The Euro members have only themselves to blame for their ridiculous situation.
They don't need the vultures swirling around them though.
What vultures are they. I'd love to see someone from Brussels just come out and admit that their Euro project is a disaster.
I think we are past blaming.
I think we need to focus on what might happen if the eurozone collapses.
There might be a clue in the events which took place in the UK on 14-15 September 2007. At the hint of financial difficulties, people panic.
In the days leading up the eurozone collapse and financial meltdown across the Channel, the UK government number 1 task will be to prevent panic. Which providing reassurance and any amount of money needed to reassure the British public and British business.
Remind me what happened?
The vultures who want to see economies fail completely just so they can forward their own agenda.
It's really quite unpleasant.
What about the ignorant people who set up the Euro and were warned time and time again that Athens and Berlin or Lisbon and Helsinki do not have the same types of economy to have a single currency yet they went ahead anyway. Should they not have some of the blame?
A breakup of the UK is a much likelier event actually.
Yes.
But it doesn't alter the facts. And there are more even pressing concerns that blaming people. What action should the UK government be taking to protect its citizens, British banks and British business in the event of eurozone collapse ?
Like you, I have concerns about the eurozone's future. What concerns me more is what happens to us ?
This: https://www.youtube.com/watch?v=EyVk8EI6asQ
Over the last few years and especially at the height of the crisis, the Daily Telegraph especially along with most of the British media have been forecasting the demise of the euro.
So ask yourself a question, just how many countries have left the eurozone? NONE
How many times has Ambrose Pritchard from the Daily Telegraph warned about an imminent*collapse, yet new countries have joined since those predictions.
What's even stronger than the determination of euro governments and the ECB to maintain the euro is their refusal to allow those who enriched themselves, bankers and so on, in causing the financial crisis, to pay any price for it. Hence their absolute refusal, along with the IMF, to write off any Greek debt. Just as with Ireland, where the EU insisted investors in Ireland;s bankrupt banks must be bailed out, in full, by the people of Ireland, they'll make no concession to Greece that could cost their rich friends anything. That attitude could lead to the euro breaking up messily.
You're right about the ECB and the EU refusing to allow bankers or bondholders to pay the price for their mistakes or as we like to say in Ireland being paid a return on their failed betting slips. Now in Ireland we had a large banking crisis, but in Greece most of their woes was a fiscal crisis. They were living way, way beyond their means and pretty much had a non existent tax collecting system. Greece can be let loose now as Draghi and Merkel know there will be little or no contagion despite what you may read in the Daily Telegraph. Greece should have been let loose years ago but the Germans and the ECB kept them in as they feared back then, one country's exit may bring the whole show tumbling down. The euro will be here next year, in five years, in ten years and so on.
Of course.
The Germany economy would be bought to a standstill if it had to go back to the Mark, the value would so high.
The problem is, Germanys success is what is causing the problems in Southern Europe.
Also opinion poll after opinion poll in eurozone countries including Greece always shows a majority of peoples still wanting to use the euro. So while the political will is huge in Germany it is widespread in the eurozone, British newspapers never really grasp this either.
When the euro began my main reason for opposing it, and especially opposing the UK joining, was that I knew that when a serious economic crisis occurred, whatever the cause , it would put the euro under great strain. The divergent needs of the member states would be amplified, with much animosity between them occurring, leading perhaps to the euro, and maybe even the EU, breaking up, and we are possibly on that path. Even worse fascists are gaining support in some countries, just as they did in the slump of the thirties. I fear we maybe repeating that history.
I'm not sure we're on a path of breakup but politics is changing in europe, be it the True Finns in Finland, Podemos in Spain, Syriza in Greece, SNP perhaps holding the balance of power across the water in a couple of weeks or even in Ireland. But as we in Ireland have a PR voting system, our change is and will be even greater. But in saying that, polls across europe still favour EU membership or EZ membership.
Take Britain, if consistent polls on the EU showed a majority wanting to stay in the EU and an actual referendum produced a majority wanting to stay, a UK PM would have no legitimacy to withdraw Britain from Europe. That is currently the picture in the eurozone, there is just no appetite to leave.
Take my country Ireland, we are currently the fastest growing economy not only in the eurozone but the whole EU, including Britain. Spain is beginning to grow again and it is hope the eurozone is finally getting out of this crisis.
Now the Americans are putting pressure on Greece,
https://uk.news.yahoo.com/us-piles-pressure-athens-greek-224015918.html#ezHz2Dv
Obama more directly called on Athens to accept the requirements that EU negotiators insist upon before releasing any more funds from the massive financial rescue program.
"Greece needs to initiate reforms," Obama said at a joint press conference with Italian Prime Minister Matteo Renzi at the White House.
"They have to collect taxes. They have to reduce their bureaucracy, (institute) more flexible labor practices," he said.
Read the full article and you say the Americans are worried that Grexit could cause chaos on financial markets. If said markets can be so spooked by the problems of a small country like Greece, then it's the markets that need reforming.