Tag Archives: European sovereign debt crisis

Let debtor nations leave euro, say German experts – FT.com

July 29, 2015 By in Austerity, Business Administration, Economics, Euro Crisis, Fiscal Policy, Foreign Policy, France, Germany, Greece, Growth, Politicians, Politics, Reform Tags: , , , , , , , , , 4 Comments

This is an important read from the FT, citing a report from Germany‘s Council of Economic Experts.

via Let debtor nations leave euro, say German experts – FT.com.

Whilst the FT’s article is a good read, it’s well worth reading the evidence from the German experts. You can rest assured that it is being avidly read by mainstream economists around the world.

I read the executive summary from the German experts and many of the points are sound from a Germanic view of Europe. However, there are some fundamental weaknesses. Firstly, every international mainstream economist has been arguing for years for Germany to reflate, create some controlled inflation, to give the rest of Europe some breathing room. Secondly, the obsession with fiscal balancing ignores export imbalances (see Bernancke’s argument) – it also fails to address the economic case for top quality capital spending to stimulate the economic multiplier. Thirdly, it fails to address the serious policy errors by both the IMF and the ECB – this was largely in response to political pressure from Germany.

Thoughts?

Opinion – Bad Faith. Why Real Debt Relief Is Not On The Table For Greece » James K Galbraith – Social Europe – John Gelmini

June 20, 2015 By in Austerity, Business Administration, Fiscal Policy, Growth, People, Politics Tags: , , , , , , , , , Leave a comment
International Monetary Fund

International Monetary Fund (Photo credit: Wikipedia)

Whilst I understand this narrative from Dr Alf and James K Galbraith, of malevolent French and German banks and people at the IMF being the culprits, I cannot simply absolve Greece and its Government of culpability.

The UK and America and every country in Europe bailed out the banks and those who controlled them 3 times, yet in the UK not a single banker went to prison and none of the money laundered through hedge funds and secreted in up to 40 different tax havens has been recovered. America is still trillions of dollars in debt, yet not one penny of the $400 billion which disappeared when Lehman Brothers collapsed has been recovered.

The world’s super rich doubled their money before the LIBOR rate rigging scandal, during the period between it and the original banking crisis but everyone else took a substantial and painful “haircut” as a direct result of this “controlled demolition” of the world financial system perpetrated by criminals at the upper end of the “food chain”.

The rest of us could engage in the blame game, riots and civil commotion, just like the Greeks, but we take our medicine with a sense of weary resignation and profound irritation with the authorities, the banks and now the Greeks must do the same.

The criminals are still in position, seemingly untouchable and able to do what they like and short of divine intervention and the actions of an Icelandic style super-bailiff aided by forensic accounts, computer hackers, international lawyers and recovery experts, our money is permanently stolen.

John Gelmini