WHY are we helping to bail out Greece when we're broke? I mean, I feel sorry for the Greek citizens, but can we really afford this right now?
Habee, we live in a global economy. We HAVE to afford this right now...although, technically the IMF is doing the "bailing" along with countries in the Euro zone. (And yes, I'm aware that the US has a large claim in the IMF).
I feel more sorry for Greece when the IMF does bail them out. Have you checked out the IMFs policies?
Anyway, here's a really good article on the subject:
http://www.spiegel.de/international/eur … 17,00.html
It seems that regardless of who is in office, no one wants to deal with fiscal responsibility or even try a hand at monetary policy?
These clowns continue to throw bad(debt) money on problems that are not presently our problems as a Nation.
Too many people have their hands in the cookie jar.
But you see Cagsil, Greece IS your problem. Just like it is a problem for many other countries. Greece needs money to service its debts, whilst it reforms its financial systems. If it can't service their debt, it gets called in. They cannot pay, they are declared bankrupt, the debt is wiped and their country descends into chaos. Since the biggest 'owner' of Greek debts, which total $250bn, is the USA.... then rather than you suggesting that it is not America's problem, you should perhaps be thanking certain Euro Zone countries... particularly Germany... for ensuring that they CAN now service their debts.
It is the debts which you country 'own' which underwrite the debts that you 'owe'. Perhaps you all need to realise this before suggesting that you are giving money for nothing.
Should what you be saying exactly as it is???
Then the entire financial system built is broken. Regardless of reform, it is still broken. The reforms never have worked, every damn time they have tried them or claimed to have tried.
Too many layers of B.S. skewing the overall picture.
How much is the USA contributing?
I know that Germany had to put up a large chunk of it.
I think a full euro rescue plan is in place to stop other countries within the euro market falling over as well.
We could see another world wide collapse if that happens it seems.
I reckon jail the crooks in Greece that grafted money first would be a good starting point myself!
Apparently we don't have time for that.
The US is the largest contributor to the IMF, at 17%, or $6.8 billion of the $40 billion IMF package for Greece.
Sorry Habee but you have called this one a bit wrong.
The total rescue package is $146bn, of which $38bn is to be provided by the IMF.
If the USA is responsible for 17% of IMF contributions, then it is bailing them out to the tune of $6.46bn.
That is equivalent to 4.42% of the rescue package.
Now, if we were to know precisely how much of Greek debt is owned by America, I would suspect that it would be much higher than 4.42% and way way higher than $6.46bn.
Contrary to the US helping out the Eurozone, I suspect that all countries involved in the bailout are helping each other.
Greek Bankruptcy = written off debt. No country in the Eurozone or North America can afford to write off that debt.
The Germans are actually the biggest contributor, and trust me they are not happy about bailing them out either. The collapse of the Euro would bring down the dollar, just like it would bring down the Pound.
If it makes you feel any better, the EU is proposing that Greece is removed from the Euro as soon as they are more stable, so the EU members and the US are effectively going to buy their right to throw them out.
Consider the domino effect also, Portugal and Spain would be prone to collapse if Greece falls, goodness knows what the next countries would be, but the line of dominos does not stop in Europe.
If Germany had refused the bailout, the collapse of Greece would have affected you just as much me.
The Germans are putting up $29.6bn by the way..... not including their own IMF contributions...
No, Ryan, I was referring only to the IMF part of the rescue package. You said $38 billion; I rounded up to $40 billion. But hey, what's a billion or two among friends, right?
If you'll re-read my post, you'll see that I was referring ONLY to the IMF part of the contribution.
It's because one economy falling over will impact other economies which are doing ok. It's all interconnected. Leaders don't really have the option of being insular about this kind of thing because it will affect their own country anyway - damned if you do, and if you don't.
Hey Habee, just think what the US could pay down(forgive) in personal debt markets with that?? Versus the method being used presently.
Cagsil that is a good point.
Do I understand correctly? That When people or countries pay some of their debts, this stimulates the economy as effecietly if not more so than giving money away?
This is about saving the Euro not the Greeks - we are heading towards an economic melt down in the euro zone unless drastic action is taken
You are heading there regardless. As well as the USA though... nothing can be done to stop the train now when it is well beyond the tipping point. Time to think about your own survival.
I think the entire industrialised world is up the creek without a paddle unless someone can devise a formula however, right now Euro zone is sinking more than most imagine
So, that means, that the U.S. is suppose to go further into debt to help out?
The U.S. is already broke to the tune of more money than the most collective industrialized nations.
Hmmm....? Doesn't seem to make any sense.
I don't claim to be an economist, and like I said, I have empathy for Greece and for the EU. I also understand that economically speaking, we're "all" linked together. BUT...the U.S. is struggling financially, too. Many have lost their jobs and their homes. My son-in-law lost his job months ago and hasn't been able to find another. School systems in GA are forcing teachers to take unpaid days off to cut budgets, and even tenured teachers are losing their jobs because of a reduction in workforce. Our cities have homeless people living in their cars because so many shelters are full. Are we (the US) in any position to help other nations?
The U.S. has not been in a position to help other nations for years. It is the public who does not know the difference.
Just like, more than half of them have no clue that the green pieces of paper they have in their pocket, really is not U.S. currency.
People seem to think that the U.S. can continue to print money, as it sees fit, without any consequences, but that is a misconception in and of itself, simply because the Federal Reserve Bank is under control by World Banks.
"The U.S. has not been in a position to help other nations for years"
We have been helping other nations for all the years you are thinking of.
You are correct Sab Oh, America has been helping others. I said they haven't been in a "position" to help others for years.
I realize you read what you want, and break things up, so as to make them seem different than said, but had you actually paid attention, then you would know that America has been BROKE since 1913.
So, when exactly was America in a position to really help anyone?
Unrealistically, it hasn't been. But, thank you for your time.
Cags as soon as the Fed Reserve was created it was all downhill from there. On that one you hit the mark !They are nothing but a Financial Cartel.
"America has been BROKE since 1913" = meaningless
And your answer only shows the blindness of the whole situation. Thank you for proof.
Spend more than you earn and eventually you end up in the crapper... what nation is not spending more than they earn?? Greece is the tip of the iceberg....
Most if not all of the other euro countries are overspending, at some point it has to be paid back.... I think we heading for far more trouble... for everyone..
The whole European Union is goin down . Spain , Portugal and yes Great Britain too. We are not far behind. Better start preparing its gonna get really ugly !
Okay, I've asked this question before and got absolutely no response, so I'll ask it again. Perhaps it's very naive of me to consider it...but, I will anyway.
It seems to me that as I read about the economies of the world, we are all in debt to one another. This one owes that one, who owes this one, who owes that one. And it's all a big web of us each owing one another.
So my question is this: What if all the countries who owe each other look at each other and wipe the slates clean? Wipe the debt, start all over? All of them? (I mean, we're all just playing with monopoly money anyway, right...or is that just the U.S.?)
I know it's idealistic, but when people are thinking that the economies of entire continents could go down the tubes, maybe some idealism (and drastic measures) could be...attractive??
Come swallow your bumpers, ye Tories, and roar, That the Sons of fair Freedom are hamper'd once more;
But know that no Cut-throats our spirits can tame, Nor a host of Oppressors shall smother the flame.
In Freedom we're born, and, like Sons of the brave, Will never surrender, But swear to defend her,
And scorn to survive,
if unable to save.
Savings is the problem. Or else how debt is structured in a cob-web around the world. And the world is not delimited by the Massachusets or Georgia's state border...
Nippons get out smartly because their public debt is mainly made out on domestic loans.
I am probably not the brightest bulb in the pack but my understanding is that we are giving them money to enable them to pay back the money they already owe us.
I am all for helping out my neighbor if I have it to give but as I understand it:
1) America does not have it to give, our own citizens are suffering from the crumbling economy and charity begins at home right?
2) No bank in the world would loan money to someone who has already demonstrated an inability to return the money they already owe.
I empathize with the plight of the citizens of Greece but the truth is there are so many in the U.S. who need and are not getting that it is shameful for this country to go further into debt to bail someone else out.
Hey Ohma, you been reading my hubs lately....
I have but the reason for my post is that I tend to think very black an white so to speak.
The total lack of common sense being applied by our government these days is just too scary.
Yes, the actions of those in power have not been good, but unfortunately, this has been going on longer than you can imagine.
When you take a look and review it(history), and see the path, then you can see the destruction it creates.
It's already believed the debt is too much to overcome. With this singular problem, the people should be really scared, and see it as a wake up call for the people.
The inefficient and ineffectiveness of government is already too much, and it's about time the people paid attention.
Greece, then Portugal and Spain are on deck. The UK is in the lineup as well. Europes woes are ususally a precursor of our own. Time for the government to suck it up and quit throwing money every time some one gets a booboo. Either we are going to sacrifice a few to save us all or we are all going down together. Law of nature.
Italy looks shaky too. The monetary system of the world is dependant on the survival of all of them. Otherwise away goes Germany, the USA and everyone else as well.
Can't we just start again and forgive all debt?
earnestshub said -
"Can't we just start again and forgive all debt? "
Yes, if we start with my Mastercard....
Doug from what I have seen of you on here, that would seem fair!
I will be happier when Europe settles down, the Banks get their high interest payments and these countries can start living below their means for a while.
The people will suffer in Greece, and that is very sad, not all their fault. I hope they emerge from it strongly and that nobody in the E.U panics!
The world economy could probably be turned around quickly if the worlds shoulder goes to the wheel.
And what truly happens if the economy crashes? the dollar, Euro, Yen, or whatever loose all value right? This puts everybody on the planet back on equal footing where the only real valuable you have is your ability to provide what your neighbor needs. Barter and trade and everyone learns to survive.
Well, I do not know what is going to happen if the economy collapses, but I do know if it does, and the dollar becomes valueless on the open markets, then the entire pricing structure of the economy will do what I call a "reset".
The Banking System, which is broken(manipulated) needs to be fixed. All products will have to be re-marketed with NEW tested valuations the company thinks the products/goods or services, should be.
The currency of America would change. It would require people to integrate a form of learning. It will transform society and set the Country back about 200 years.
At least, that's what I can see, from what I've seen so far. But, then again, I am only human and can be wrong.
I agree it would create a major change for everyone and that there are many that will not make the change easily myself included primarily because I am a city dweller and have no means to sustain my family with out the technologies of our modern world, but I would adapt. and I believe that a world changing event like the economy crashing is what it is going to take for many to wake up and realize that we have allowed things to get way out of control and it is time to take back the power of the people.
Make no mistake -- Greece is going to default and be declared insolvent. Quite likely it will be set adrift by the EU because it has become too much of a drain. Italy, Spain, Portugal, Ireland, and others -- who knows? The impact will be felt here in a couple years. This is the beginning of a realignment of nations to include the predicted U.S./Mexico/Canada/South America union. Things are happening too fast for any published guidebook to handle. There are no rules anymore. Welcome to the change everybody wanted.
It is important to specify the fact that this crisis is not only due to political leaders incompetence, negligence, cupidity and complacency.
We live in an economical system where the "value" of goods is driven by rumour and obscure criteria known only to a few.
A bunch of kids behind a computer screen can manipulate rates of first necessity goods like rice, for instance, thus starving to death a whole dependent population, while pocketing some handsome fortunes.
The same Standard & Poor's and Moody's that were distributing triple A notes to stinking rotten funds like subprimes last year, lifting them to the level of corporations like Microsoft or Exxon, with the consequences that we all know, are very much responsible for this european collapse.
Them and those who pay them, that is the IMF and the Banks.
I read an interesting analogy in a paper :
It's like the Michelin guide was being written by hotel and restaurant owners themselves.
If you happen to possess a nice amount of Credit Default Swaps (CDS), just spread the rumor that a debilitated economy country, say like Portugal for instance, is trying secretely to negotiate a loan outside the euro zone. Of course, it's bully but you'll have a lot of chances to become a millionaire.
These are the "rules" that govern our economy.
Yes.. give them lots and lots of $$$!!!
thank you in advance on behalf of my relatives
It's not really right to look at it as 'helping out' other countries though. A lot of unregulated lending activities coming out of the US actually helped fuel the financial crisis. It's really a worldwide problem to be solved together.
As a world, we got greedy and stuffed up the balance.
Unless Cagsil manages to get independence for the state of Massachsets or transform it into a distant island, someone will slip a hand into his pocket. I'm almost sorry for him.
Is "moralization" of finance an utopia ?
Well, you believe what you want about the situation at hand. The point is that the U.S. has not been in a "position" to offer assistance, especially assistance it has no way of getting back. DUH! Money makes money! Throwing good money after bad is foolish, ridiculous and absurd.
You believe what you want too. I believe the digestion I make out of reading news papers. What else ?
Subprimes was good money one day, plenty of American and European institutions bought plenty, and the next day it was rotten money. And they contributed to change good savings money in shit.
What good money are you referring to ?
Money generated by labour, I believe. I too consider labour money good money too. And not out of religious or moral considerations.
There is a lot of good money, a lot from America a lot from other countries, that is being employed in a war taking place far away. And it costs, it costs it costs.
And you can trust America. Americans always know how to get their money back.
American business knows how to get it's money back. Do not make the mistake of thinking that the pathetic government knows how to get it's money back, because it's already proven it cannot. So, let's not go there. Then again, if you are ready to really talk about the underlying problem, then by all means(if you think you know), but until you do decide to talk about the underlying problem....throwing any form of money on the damn problem is good money thrown after bad.
The underlying problem...
Tell us about that.
I'm sure you must have rivers of enlightened knowledge about the matter, as you seem to have about all in general.
Have you ever travelled out of Massachusets ?
We is not really the United States. When will people wake up and realize our Money Supply is under the control of independent international bankers and not the Citizens of the United States.
The Federal Reserve hands out money to whomever they want whenever they want with ZERO accountability or recourse. Why do you think they are fighting an audit so hard?
The IMF doesn't care about Greece. They want to gain control of Greece's assets. When you print money from nothing it's pretty easy to just buy whatever you want. And when the debt can not be repaid you move in and seize control of the assets.
This is exactly why central banks are so dangerous.
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