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Post Reply Greek debt crisis
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Posted 7/1/15 , edited 7/1/15
Greece has been fucked over for a while now. Even before the whole financial crisis came to light a while back the signs were already there. EU should have never gone with that euro dollar in the first place to be honest.
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Posted 7/1/15

J-POP187 wrote:

While I see what your saying doesn't simply printing more of your currency simply devalues it? In the end if other countries "however unlikely" see that the US dollar is weakening don't they have the choice of choosing to hold a better off country notes instead of the dollar?
To be honest I only got into economics when I saw this video and got into looking into different countries economies since then. Curious what do you think?
https://www.youtube.com/watch?v=fDfNoCjtXvQ


I'll address your first point now and I'll respond again regarding the video.

"While I see what your saying doesn't simply printing more of your currency simply devalues it?"
-Printing money does NOT devalue the currency. The best way to get this is an example. If the government prints $10,000,000,000,000,000,000 dollars and puts it in a bunker under the White House, how would that affect the currency value? Answer: It wouldn't. Simply printing the dollar does nothing, what matters is where and how and how much is spent. If the government prints $1 billion dollars and spends it, that would affect the economy, but it would be no different than if a business or anyone else spent the same amount of money in the same place. (at least regarding the dollar's value.) When people say that the government printing money will devalue the dollar, they posit a very serious assumption, and that assumption is that we are, as a nation, at 0% unemployment. The only situation in which the government spending money automatically causes inflation (devaluation of the currency,) is if all markets are at maximum output. This is because the assumption of inflation caused by the idea that 1) There is no way any product can be made more of. That is, all factories/car companies etc are producing the maximum possible output with the maximum possible number of employees at all times. 2) IF that were the case, then if you tried to buy $1 billion dollars worth of cars, and they are at maximum output, their only viable response would be to raise the prices in order to allow for the purchases to happen, (because why turn down someone offering to pay more for the same product?) thus causing inflation and the oh-so-dreaded devaluation of the dollar. But again, that's exactly the same thing that would happen if ANYONE ELSE SPENT THE MONEY TOO. So if Bill Gates pulled $1 Billion out of his off-shore bank account and spent it, in this scenario that would also "devalue the currency" just as much as the government spending the money would. But the key point is this, we aren't at 0% employment so none of that makes a damned bit of difference. This is especially important for a place like Greece where unemployment is extremely high, because if they were able to print money they could spend and put people to work. Because, when unemployment is above 0% the additional spending reduces unemployment with no change to price.

This is not whacko theory, this is just basic Keynesian theory which was decidedly accepted during his time, and then manipulated and misrepresented so you can now have economists who call themselves Keynesian but are actually hardcore orthodox economists who think that we should go back to the "natural" gold standard.
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Posted 7/1/15 , edited 7/1/15

J-POP187 wrote:


While I see what your saying doesn't simply printing more of your currency simply devalues it? In the end if other countries "however unlikely" see that the US dollar is weakening don't they have the choice of choosing to hold a better off country notes instead of the dollar?
To be honest I only got into economics when I saw this video and got into looking into different countries economies since then. Curious what do you think?
https://www.youtube.com/watch?v=fDfNoCjtXvQ


Alright, watched the video, and everything in it is pretty much wrong. They describe the commonly thought of history of money, "Well before we had money, everything was exactly like it was now except without money, right?" Nope. There never was a 'barter economy' where the primary method of exchange in the economy was barter. Barter surely existed, but it was never the thing that kept the economy goin' round. Furthermore, inflation isn't a problem. The problem with inflation is when it leads to hyperinflation where you get a lot of inflation over a short time. The reason inflation is a good thing when not fast is that 1) it encourages investment. If dollars have less value that means prices will rise. So that means prime investing for things like houses! It also means that the debt of the private sector decreases, because the value of the debt will also decrease resulting in negative interest. So, if you're like the vast majority of the public and you have a crapton of debt, inflation is a good thing because it means the real value of your debt decreases. So who's it bad for? Rich people, (I wonder why there's such an outcry over inflation, hmmm,) they typically have large bank accounts which become worth less as inflation rises. It also damages those with non-liquid expensive financial assets like factory machines that need to be replaced at far higher price than they were originally purchased due to increase in the general price level.

So yes, printing 100 billion dollars and buying up all the bread in the U.S. would cause CRAZY inflation and make bread worth like $10,000 a loaf. But as long as the government chooses where to spend its money we'll be fine on the hyperinflation front.
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Posted 7/1/15
If I were in Greece right now, I'd just jump in front of a bus. Wouldn't be worth living.
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Posted 7/1/15
I have a solution to Greece problems , the date was April 19, 1775.........
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Posted 7/1/15
With the bank frozen, all you gotta do is withdraw the maximum amount everyday.....for the next couple years....all while spending no money on food or anything.....yeah.
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Posted 7/1/15 , edited 7/1/15
...Should I?
Nah.
Anyways, far as I understand, Greece needs to pay the piper, but they can't, so there go the children.
They don't have any bargaining power. They're, uh, royally screwed, as far as I'm aware.
Edit: One thing is certain; things will change. And it will probably not be fun for Greece, but they still need to eat, so things will change.
I didn't mean they'd actually not have food, they're still a sovereign nation.
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Posted 7/1/15
Its really simple if they cant pay back the loan you either sell off all your major assets if they still have any or you get annexed by the EU until you can buy back your freedom. It sounds harsh but its better then the alternate which is no food, no jobs, no life.
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Posted 7/1/15

spensaur wrote:


Bantarific wrote:

Then you don't understand money. You don't need a gold standard or some other arbitrarily enforced limit on your currency to get out of a depression.


So you're saying it's okay that we just print money out of thin air with promissory notes saying we'll eventually pay you back with the money we don't have.


I definitely agree with where you are coming from, but I feel it is important to note this is why governments often tie their economy to some sort of material backing. China is backed by gold for instance and tragically the US felt oil was a better idea and tied their value to that.
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Posted 7/1/15

Punk_Mela wrote:

I definitely agree with where you are coming from, but I feel it is important to note this is why governments often tie their economy to some sort of material backing. China is backed by gold for instance and tragically the US felt oil was a better idea and tied their value to that.


Not sure if serious?
The U.S.'s currency isn't directly tied to anything as of yet. Though if you're just being facetious I commend the "oil backed money" quip.
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Posted 7/2/15
Just goes to show that most left wingers are stupid and can't run anything.
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Posted 7/2/15

Bantarific wrote:


Punk_Mela wrote:

I definitely agree with where you are coming from, but I feel it is important to note this is why governments often tie their economy to some sort of material backing. China is backed by gold for instance and tragically the US felt oil was a better idea and tied their value to that.


Not sure if serious?
The U.S.'s currency isn't directly tied to anything as of yet. Though if you're just being facetious I commend the "oil backed money" quip.


Not being facetious, the switch took place under Nixon's administration. I don't follow stuff like that to closely personally, the only reason I brought it up here was because the United State's switch was a pretty heavy topic in a seminar I attended for college last week.

I am all for calling the teacher-man a liar, but I felt he had enough sources to trust him on this one.
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Posted 7/2/15

wingopanda wrote:

Just goes to show that most left wingers are stupid and can't run anything.


Really so how do you explain Sweden, Norway, Finland, Denmark and Canada the list goes on all left leaning countries as well as the United States I know everyone on the right keeps screaming that we are a right leaning country but the evidence doesn't show that if we were a right leaning country we wouldn't have the progress we have to date. Lets face it the Constitution as well is an incredibly progressive and liberal idea when it comes to protecting freedoms. Self rule not king or church telling us what to do huh how novel an idea.


The key is to work together and make the group stronger if all you have is greedy people you don't have a society you have anarchy and that never works.
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Posted 7/2/15

gvblackmoon wrote:


wingopanda wrote:

Just goes to show that most left wingers are stupid and can't run anything.


Really so how do you explain Sweden, Norway, Finland, Denmark and Canada the list goes on all left leaning countries as well as the United States I know everyone on the right keeps screaming that we are a right leaning country but the evidence doesn't show that if we were a right leaning country we wouldn't have the progress we have to date. Lets face it the Constitution as well is an incredibly progressive and liberal idea when it comes to protecting freedoms. Self rule not king or church telling us what to do huh how novel an idea.


The key is to work together and make the group stronger if all you have is greedy people you don't have a society you have anarchy and that never works.


implying any of those countries are good.
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Posted 7/2/15

Punk_Mela wrote:


Bantarific wrote:


Punk_Mela wrote:

I definitely agree with where you are coming from, but I feel it is important to note this is why governments often tie their economy to some sort of material backing. China is backed by gold for instance and tragically the US felt oil was a better idea and tied their value to that.


Not sure if serious?
The U.S.'s currency isn't directly tied to anything as of yet. Though if you're just being facetious I commend the "oil backed money" quip.


Not being facetious, the switch took place under Nixon's administration. I don't follow stuff like that to closely personally, the only reason I brought it up here was because the United State's switch was a pretty heavy topic in a seminar I attended for college last week.

I am all for calling the teacher-man a liar, but I felt he had enough sources to trust him on this one.


It really isn't oil what backs the good old green back is the good faith of the fact that we actually do pay our debts in a timely fashion. I would question anyone that says it is since that would peg the currency at an exchange rate that would cause similar problems that you get with gold since we don't have those problem it is a free floating currency. now the one thing against oil backing the dollar is the oil crisis back in the 70s so many kids didn't live through that I barely remember it but guess what Nixon was there for it in power why would he peg the dollar to oil if it could be so easily controlled? Yes I remember the lines and we didn't get our oil from the OPEC nations we get it domestically here in Washington. Nixon left office in 74 the first embargo was in 73 the second one which is the one I remember was in 79 thought it wasn't as bad because we had started keeping a reserve.
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