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Will Greek Finance Minister Varoufakis Support Cryptocurrency In Greece?
giulioprisco writes New Greek Finance Minister Yanis Varoufakis, former Economist-in-Residence at game developer Valve Corporation, sees something like Bitcoin — or, more likely, a state-controlled "Fedcoin" — possibly playing a role in the (necessarily creative) rescue of the Greek economy. "The technology of Bitcoin, if suitably adapted, can be employed profitably in the Eurozone," he said.
Will Greek Finance Minister Varoufakis Support Cryptocurrency In Greece?
No
As obvious as the question is stupid.....
Greece doesn't need a currency, it needs liquidity - a crypto currency won't bring that. The entire current issue is not about which currency to go for, its how Greece keeps paying its creditors - if they can't service their current debts, their ability to borrow goes through the floor, and a crypto currency isn't going to reverse that. Greece can't back its own crypto currency with anything it has a monopoly on either because it doesn't have anything that valuable.
The European economy is contrary to 5 or 6 years ago presently plenty strong enough to absorb the exit of Greece from the Euro.
But for the EU it is a matter practicality and also of honour to keep the lot together, it is the difference between a continuing struggle and complete failure for the Greek economy and people.
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My favorite story about Greece's problems:
In the 90's a governmental committee was formed for the sole purpose to close a particular dam. After a decade, the dam was closed and demolished. That committee still exists. They don't go around closing other dams, they, I assume, just make sure the dam is still closed.
Source: Planet Money
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If Greece implodes, it could take the entire Eurozone with it by causing domino defaults, because Greece owes a lot of money to other nations that are already in dire fiscal straights
Two years ago maybe, when the whole euro-zone was in a depression and there weren't plans in place but now they've prepared and the Greek economy is only about 2% of the total. Germany has been very ready to play hardball and let Greece fall on their sword if they don't stick to the rescue plan. You have to remember that once you've made sure the other dominos won't fall many want to make Greece an example of what happens when you spend irresponsibly. So does their new PM really want to go "all in" and find out if they'll really get kicked out of the-euro zone? That's some real high stakes poker there if he gets called they tell him to get out.
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Iceland did the right thinag. The Government shouldn't be forced to pay the debts of failed private companies. Even if they are banks. The PIIGS are all suffering because they followed the EU command to assume private banking debts. Notice how even in Greece, which had the most government debt, supposedly they had to cave in early because other 'the ATMs wouldn't have money to dispense next week' because of a banking run. Bah.
More like the capitalists don't dare let them succeed. It would show the world that there was another way, and demands to go that way would escalate in other states.
I will assume that you are not a troll. The fault lies within the Greeks themselves. You cannot forever consume more than you produce. No matter who you are. Capitalist or socialist. Greece has borrowed to support their lifestyle since WWII, if not before. They are constantly running an operating deficit. Nobody wants to lend Greece money because Greece does not want to change their ways. They want to consume more than they produce. The Greeks would't lend themselves the money!
Austerity is not the problem, it's a solution. Did you Notice that Greece has not proposed one solution in which they pay back the debt? They only demand they are bringing to the table is that they can't be asked to reduce their spending. It's humiliating.
Now some will come forward and say that a recession is not the time to reduce spending. This is right when you are not always running a deficit and when the burden of your debt is manageable. Greece was forgiven 100 billion euros already. If the Greeks don't want the austerity measures let them propose a solution to the repayment of all the loans including the 100 billion which was forgiven on the condition of austerity.
I am more of a socialist than a capitalist. I honestly believe that the state needs to help even the field in order to produce more than is consumed which translates to building wealth. Yeah I agree with you the boogieman did it. It's just that the boogieman in this case it's the Greeks who think that they are entitled to live beyond their means.
DRM? No thanks, I'll just get it somewhere else...
Yes, just like we wiped out North Korea, Vietnam, Iraq, and Afghanistan, and just how we've just about wiped out ISIS and stuff.
It little behooves the best of us to comment on the rest of us.
Once the possibility of someone exiting the Euro becomes real other countries will be tempted or pushed out basically making it pointless.
It was an economic marriage. And like in any marriage there are good times and bad times. Unfortunately some in Europe don't think of it this way.
Not pointless - there's real economic benefit to a single currency for Europe.
If it's a marriage, then Greece is the abusive, cheating spouse. They've gone from irresponsibly spending more than they could ever repay (since they can't inflate their way out of debt), through a brief attempt at surviving austerity (terms of the debt relief they got - everyone knew it would suck), to saying "screw you, we're too big to fail, we're gonna spend spend spend, what are you gonna do about it?"
Greece was in a better economic position than most of Eastern Europe at the start of all this, with a better standard of living (even had they chosen to live within their means) than many later entrants in to Euro. But they chose to spend vastly more than they were making, running up the highest debt-to-GDP ratio in Europe, inflating that standard of living artificially until they could borrow no more.
What the US thinks of that isn't very relevant, but those Easter European countries that made real sacrifice to join the Euro, and who have been keeping their debt down and surviving with a much lower standard of living than Greece and directly paying for Greece's first bailout in some cases aren't impressed with Greece's excuses. At this point, a "Grexit" will be less disruptive than continued bailouts.
Socialism: a lie told by totalitarians and believed by fools.
Prediction is Greece will exit the EU because of inefficient use of all forms of resources. They have been pseudo-socialist giveaway state for so long w/1 in 3 workers working for the state's institutions, they've collectively forgotten market economics is what runs countries effectively.
Venezuela is the prime example of wasteful redistribution policies by a government which collapse a society (military takeover is next.)
Greece will change fairly soon and it will be somewhat painful or they will deteriorate toward Venezuela's position, in which case it will impoverish Greece's working class.
The Eurozone might be able to absorb a Greek exit in purely financial terms, but in psychological terms it would be a disaster. If Greece leaves, then that provides a precedent for countries leaving. Investments in Euros are based on the premise that the Euro is backed by a large economic base and if countries can leave that base then there's a lot less of an incentive to use the Euro. That's likely to lead to a drop in liquidity in the rest of the Eurozone, which would make leaving an even more attractive bet for some of the weaker economies.
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Nearly every EU country has a couple of conspiracy nuts claiming *.* screwed them during or before unification.
The problem is not someone loaned bad or good money to Greece, the problem is Greece wasn't and isn't able to hold up it's own pants, all due to their own lack of courage to fix their tax and economic imbalances.
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The fact that the Troika hasn't been willing to give one iota on the Greece issue should be enough of a reflection on how little consequence they think an exit of Greece from the eurozone would be. Germany in particular doesn't want to give any ground (I imagine all of the nazi-name calling has played no small part), but they're hardly alone, many countries are taking a very hardline stance on Greece. Most parties feel that the consequence of giving way to Greece could be significant, but the consequences of their exit - while not completely painless - would not be that dramatic.
On the other hand, in Greece, there's only one route for exit, and that's capital controls (or a rapid conversion over the weekend) where everyone's assets are converted to some kind of new-drachma, which instantly devalues to half its value or less. Which is why everyone is taking their euros out of the banks, they're not stupid (unfortunately, thieves aren't stupid either, breakins have become an epidemic as they look for people hoarding money at home).
I can't see a cryptocurrency helping in any way... if anything I'd guess it'd only serve to unnerve markets even more and lose even more value as a consequence. I could picture it maybe as a simultaneous and rate-locked currency to a physical New Drachma, maybe. But it sounds IMHO like an incredibly risky move even then. I mean, one presumes for example that there's a government-controlled master key to "print" more cryptocoins? Then that means that your entire economy can be crushed overnight by someone hacking, physically stealing, misusing, cracking, or whatnot your master key. Isn't that an unnecessarily big risk to take? And on an individual level it seems full of problems as well...
Don't get me wrong, I don't think cryptocurrencies are inherently an evil or shouldn't exist. But I would have serious second thoughts about such a massive nationwide rollout on a country that's already in chaos.
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There's also this big lie that "Greece has been saddled with debts that they could never pay". Greece's state assets are worth an order of magnitude more than their debts. They could sell off a tenth of them and have all of their debts in the clear right away.
Obviously, they don't want to privatize everything, and I don't blame them. But the concept that this debt is impossible to service is simply a lie. They just don't want to. Heck, they could do it without excessive pain to the middle class or extensive privatization if only they'd go after their wealthy - there's a couple dozen Greek billionaires and countless more in the next eschelons. And these are the biggest tax dodgers who don't pay anywhere close to their fair share. But Greece is apparently either unable or unwilling to go after them.
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Austerity is not the problem, it's a solution. Did you Notice that Greece has not proposed one solution in which they pay back the debt?
Actually Greece is proposing to pay back all of their debt. What they are saying is that instead of crippling austerity that is ruining Greek people's lives they want to first fix their economy, recover and when times are good pay off the debt. It worked well in other countries, such as Britain after WW2. Rather than paying off debts to the US and banks the government rebuilt the country. Lots of jobs, lots of investment and stimulus. Then when things were booming again debt was paid off.
Austerity has already failed in Greece. Eventually it might pay off the debt but people still need to live in the mean time. Massive unemployment and people not being able to afford basics like food and electricity are not a solution.
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You've read too much propaganda.
The crisis in Greece has many reasons. Inefficiency is a problem, but not a crisis cause. The fact that the country had a strongly interconnected (not to say, inbred) web of corruption between politics, administration and business is much more likely to have been a leading cause.
The greek "giveaway state" is such a cheap myth. They don't even have social welfare the way that those who cry loudest (e.g. Germany) have.
The real problem is that Greece was heavily in debt to foreign banks. Instead of giving them a way out, the governments of the countries of those banks pressured them into paying their debts and interests, and cutting spending. When your economy is in a crisis, every economist who's not a total idiot knows that cutting government spending will deepen the crisis. What a surprise, that's exactly what happened.
And now comes the magic trick: The amount of debt that the EU, European Central Bank and IWF consider "acceptable" is calculated based on a countries GDP. Greece actually cut spending a lot and last year ran on a balanced budget, something that our own Mrs. Merkel didn't manage to do with our country. Greece debt has actually decreased. However, due to the magic trick, Greece debt ratio has become worse, not because of more debt, but because of less GDP.
It's like telling you that because you're in debt, you need to sell your car to pay me. And after you've done so, telling you that because your net worth has now declined, you've now got a different credit rating and owe me more money for the higher risk.
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But Greece is apparently either unable or unwilling to go after them.
The old government was, because of the strong ties between the old parties and the business moguls. The new government has no such ties, and has, in fact, announced steps to do exactly what you say they should do.
But, of course, since they're evil communistsocialistliberalevilcommitraitors, it doesn't matter what they actually do, does it?
Assorted stuff I do sometimes: Lemuria.org