

Greece is broken, and can’t be fixed - bootload
http://blogs.reuters.com/felix-salmon/2012/02/15/greece-is-broken-and-cant-be-fixed/

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Gravityloss
Björn Wahlroos, a leading banker in Finland says roughly that Germany's just
propping up Greece with Euro countries' help packages so that German banks
that loaned careless money to Greece wouldn't fail. Why not just default
Greece and those German banks?

It's sad for the citizens EU countries that did not lend to Greece. In just
today's announced package, my share as a taxpayer is around 2000 euros.

"The world is currently living through the crisis of the euro. According to
banker Wahlroos, banks are at the core of the crisis. “Perhaps the most
central unrecognised fact of this crisis is that Germany’s banking system is
rotten to the core.” “For most European banks Greece’s lack of
creditworthiness, or its bankruptcy, would not be too harmful – except for the
Landesbank, which is owned by the German states, and Commerzbank, which is
partly owned by the central federation, which – after being forced to reduce
their receivables from Greece – are in a situation in which their capital is
not sufficient for engaging in banking activities.” Wahlroos feels that “Mrs.
Merkel made the wrong decision in the spring of 2010”."

[http://www.hs.fi/english/article/Bj%C3%B6rn+Wahlroos+%E2%80%...](http://www.hs.fi/english/article/Bj%C3%B6rn+Wahlroos+%E2%80%93+a+portrait+of+a+capitalist/1329103438342)

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ahi
A default is inevitable. However, last time I read about it (month or two ago)
government expenses less debt payments was still greater than government
revenues. So they still need financing. If they can get revenues and (non-
debt) expenditures balanced they can stop pretending they will pay the Germans
back.

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Robelius
Since Greece accepted the new bailout they will have to cut government
employment, and employee salaries. And since a large number of Greeks are
government employees, the result will be less spending. Less spending leads to
a weaker economy.

If they choose to o back to their old currency, the drachma, their currency
would be weak. A weak currency would lead to less spending, which leads to a
weaker economy.

It's almost laughable, either way they would be, well you know. I feel sorry
for the politicians right now.

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MaysonL
Actually, a weaker currency leads to a stronger economy through more exports
and greater tourist income. It only hurts if you owe foreign currenty, and are
unwilling to default on those debts. See Argentina after going off the dollar
peg, and Iceland after its banks collapsed.

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Robelius
But it is the psychological effect of having a strong currency being
substituted with a weaker currency that will lessen consumption. Economics is
more of the psychology of the consumer than anything else, at least in my
opinion.

