Greece Opts No New Proposal Today
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@scottalanmiller said:
Greece opts for another day without a proposal! European stocks rising as the EU starts taking a hard line on Greece.
China taking a beating so heavy that they have mostly shut down the market.
OH wow.. OK we could be in for a real hurtin' if they implode!
What is wrong with the normal news - why is this not headline stuff?
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It is here. We have a large Greek population in Melbourne.
So big in fact, that some of the signs are actually in Greek (well wen I was there last... a decade or so ago) -
I'm not talking about the Greece news, I'm talking about the China news! That makes Greece look like a walk in the park!
Greece's economy is said to be roughly the equivalent of Miami Florida. While no means a small city, it's tiny in the grand scheme of things.
China is the world's second largest economy (again according to an article I just read). If it slumps, the whole world will feel it hugely!
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@Dashrender Yeah, that's been in the news a bit but not nearly as much as it should be. A lot of our iron ore goes there.
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@Dashrender said:
What is wrong with the normal news - why is this not headline stuff?
What news have you been reading? It's not just the headline, it's the top five headlines on CNN. It's the top item on BBC. It's the top on Al Jazeera. The two top world news agencies and America's largest all have it dominating the news and have for weeks.
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That explains a lot... I get most of my news from Facebook and this thread... :bowtie:
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@Dashrender said:
I'm not talking about the Greece news, I'm talking about the China news! That makes Greece look like a walk in the park!
Oh, well I'm not sure. The Greek news is really big. Really, really big. I don't think you realize the size of the EU economy compared to China. China is certainly huge news. But the Greek news is truly epic. China is definitely somewhat smaller news.
But again, CNN, BBC have it in the second line news, AJ has it on the front page but farther down.
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@dafyre said:
That explains a lot... I get most of my news from Facebook and this thread... :bowtie:
Sadly - so do I, but I also listen to the radio in the morning when I run out of pod casts. I didn't hear anything Monday or Tuesday morning about China.. only Greece.
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@nadnerB said:
@Dashrender Yeah, that's been in the news a bit but not nearly as much as it should be. A lot of our iron ore goes there.
Or doesn't, anymore. Australia made the financial headlines this morning for the huge drop in iron ore exportation.
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@Dashrender said:
@dafyre said:
That explains a lot... I get most of my news from Facebook and this thread... :bowtie:
Sadly - so do I, but I also listen to the radio in the morning when I run out of pod casts. I didn't hear anything Monday or Tuesday morning about China.. only Greece.
I have NPR and BBC on my Echo. I don't have it with me, but it is set up to give me the headlines from those two when I am "home" with it.
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BBC, Al Jazeera and NPR are my favourite news outlets.
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@Dashrender said:
China is the world's second largest economy (again according to an article I just read). If it slumps, the whole world will feel it hugely!
It was second before this all happened. But only barely. The top many are all pretty close. It is only in the last two years, I think, that it passed Japan and Germany. But Japan and China are going down while Germany is going up. So that might have changed already.
But it is misleading. China is the world's second largest economy but is more than 1/3rd of the planet's population. The EU is not listed as a single economy but as separate ones with several: Germany, France, Italy, UK and Spain being very close to China in size. So as a block, the EU dwarfs all other economies including the US, so the Greek issue is an order of magnitude a bigger deal right now.
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@scottalanmiller said:
@Dashrender said:
China is the world's second largest economy (again according to an article I just read). If it slumps, the whole world will feel it hugely!
It was second before this all happened. But only barely. The top many are all pretty close. It is only in the last two years, I think, that it passed Japan and Germany. But Japan and China are going down while Germany is going up. So that might have changed already.
But it is misleading. China is the world's second largest economy but is more than 1/3rd of the planet's population. The EU is not listed as a single economy but as separate ones with several: Germany, France, Italy, UK and Spain being very close to China in size. So as a block, the EU dwarfs all other economies including the US, so the Greek issue is an order of magnitude a bigger deal right now.
Why is it a bigger deal? If the EU as a block dwarfs all other economies, and Greece's economy is the size of Miami's, are you saying that if Miami defaulted that the US would be shaking in it's boots economy wise? Man I wouldn't have thought so, though in reality I definitely don't understand macroeconomics, so maybe we would.
I recall when California was looking to default... I don't recall that being the harbinger of doom. Sure it didn't look good, but I don't recall the news making it seem like the US economy might collapse because of it - but as I write that, perhaps they don't want to say that so they don't panic everyone.
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@Dashrender said:
Why is it a bigger deal? If the EU as a block dwarfs all other economies, and Greece's economy is the size of Miami's, are you saying that if Miami defaulted that the US would be shaking in it's boots economy wise?
Yes, if Miami defaulted (and Puerto Rico is about to in reality) it would devastate the US. A default of Greece is a literally unprecedented move. No first world economy has ever failed to this level. That Greece is only a small piece of the world's biggest economy is misleading. This is a full economic collapse of part of the EU. And Greece isn't a city, it is a state. It would be roughly the equivalent economic impact as if Florida defaulted or maybe Florida and Alabama together (the EU has about half the member states of the US, so it is to the US much like two states going.) It's not like California (Germany), New York (UK) or Texas (France) failing, but it is still really big.
This isn't a "bad economic downturn", this is a default. It's epic. This will shake the entire global economy and do so instantly. The impact to Europe is going to be enormous, no matter what the result is. China is big, but it is not nearly as big and they are only in a slump. It's a very different thing.
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@Dashrender said:
I recall when California was looking to default... I don't recall that being the harbinger of doom. Sure it didn't look good, but I don't recall the news making it seem like the US economy might collapse because of it - but as I write that, perhaps they don't want to say that so they don't panic everyone.
In the US if a state defaults it is normally covered by the fed. In Europe, if a state defaults, it collapses. It's somewhat different. California was never looking to have their access to banks cut off or losing the right to have US currency. California had the ability to be seized by the US Federal government and taken over. In Greece, that would require an invasion.
It's important to remember that while the EU is in many ones one economy, it's not quite. Greece is still a single country going down in flames. This is not the same as an internal component of a larger economy going down. These are people who can't access money, can't do business, can't pay taxes, can't buy food, etc.
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Please help me to understand.
So you're saying that Greece's economy is really more akin to Florida and Arkansas, not just the city of Miami? So the comparison made in the above linked article is wrong?Also, I know at the 10,000 ft level that a city defaulting is bad for a state economy, but I'm not sure why that would be devastating to the US or world economy?
Love the discussion, please keep bringing the knowledge!
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OK I understand why it's worse for Greece than say California, but what's the fix? Just keep letting them bleed to death?
I'm sure if they collapse that some countries (probably the US) will start sending ships of food over there to help keep the people from starving.
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@Dashrender said:
So you're saying that Greece's economy is really more akin to Florida and Arkansas, not just the city of Miami? So the comparison made in the above linked article is wrong?
It is hard to compare because it is a full nation, not just a component of another one. And it is one entire "state" in a confederation of about ~28 nations. So compared to the US which is a smaller overall economy split into ~51 components. So each EU nation is a bit like two states in comparative size. Greece is a full country, but a small one by every measure (population, economy, land mass, world influence, people caring, etc.)
So in one aspect it is like two states. In another, it is not like a state at all because it is going to fall and there is not federal government responsible to pick up the pieces. The default of Greece pretty much guarantees the Grexit which could domino the Eurozone. No amount of Miami or Florida collapsing is going to leave the people who live there without a way to eat or do business. But in Greece, their real estate is going to hit zero, they are going to be begging for food on the streets and foreign powers are going to be able to literally buy the country for pennies on the dollar.
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@Dashrender said:
OK I understand why it's worse for Greece than say California, but what's the fix? Just keep letting them bleed to death?
There are two proposed fixes:
- Pump money into them and keep upping the stakes in the hopes that it works.
- Let them collapse and take the hit now before the stakes get raised.
The issue is corruption and lack of integrity. Greece is essentially stealing money and the population is flaunting their ability to do so to the rest of the world (including the US, we are one of their creditors.) They are using terms like "terrorist" to describe people who were kind enough to bail them out. It's a very bad situation.
France and Spain want the first option. They want to keep pumping in money (like China is doing) and figure out how to "spend their way out of the problem."
Bavaria's FM is demanding that no more money be wasted on a corrupt, ungrateful people and to let them fall so that other countries don't think that they can threaten and intimidate the bigger countries to bully them into handing over their lunch money, so to speak.
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@Dashrender said:
I'm sure if they collapse that some countries (probably the US) will start sending ships of food over there to help keep the people from starving.
If the ports stay open. Remember, there is no way to pay employees there, even now.
