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Πέμπτη 6 Οκτωβρίου 2011

Is It Getting Too Late To Save the Euro Zone?


Is It Getting Too Late To Save the Euro Zone?

99 comments Is It Getting Too Late To Save the Euro Zone?

Last week ended with the Dow closing 241.58 points down and falling below the 11,000 mark. Both global markets and Wall Street are likely to have their worst quarter in three years. Fears of Greece defaulting on its $485 billion of debt and of a global economic shutdown continue to fuel worries of a credit crisis similar to that in 2008 after the fall of Lehman Brothers.
It’s Sunday night — or more likely Monday morning as you’re reading this — and things aren’t looking too much rosier. Greece has already said that it will miss its budget deficit targets for 2011 and 2012: Its 2011 deficit is projected to be 8.5 percent. This is less than the 10.5 percent of 2010 but short of the 7.6 percent target that had been agreed with the European Union and the International Monetary Fund, in order for Greece to receive the next bailout installment of 8 billion euros ($10.9 billion) to avoid defaulting on its debts.
As eurozone finance ministers prepare to meet on Monday, there is a growing sense that Greece will default. The country’s economy is expected to contract by 5.5 percent this year and 2 percent next year. To qualify for the next tranche of the bailout, Greece has passed $8.8 billion in austerity measures and is preparing to lay off 30,000 public sector workers, most of whom are over 60 years old. The unpopularity of the measures, which follow previous rounds of salary and pension cuts and tax raises, is apparent as the country is hit by renewed waves of strikes (of most of the public transit system last week) and protests. Some Greeks have turned to bartering to get by on less and less.
Brian Beutler at Talking Points Memo says simply that “the European monetary union is on the verge of collapse.” Time is running out for eurozone finance ministers to figure out what to do not only to prevent a Greek default, but to staunch what has become a growing crisis in the EU, with repercussions for the the world economy. The 17 European Union nations have less than five weeks to show investors that they indeed have some plan to keep the eurozone together, before a November summit meeting of the Group of 20.
The euro has dropped to an eight-month low against the dollar prior to Monday’s crisis meeting of European country ministers. As of 9:13 a.m. in Tokyo, the euro has fallen to $1.3368 per dollar from $1.3387 in New York last week, after declining to $1.3322 — its weakest since January 18.

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Photo of 1 Greek euro by dull hunk

99 comments

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4:09am PDT on Oct 5, 2011
Goldman Sachs helped hide Greek debt off book before it joined the Euro. They are now speculating against Greece and the Euro. It is clear that this was a possble outcome from the start. One of the biggest issues the U.S. has with Iran was a new oil trading platform which traded in Euro's. If the dollar stops being the reserve currency and oil is no longer traded in it the U.S. currency will collapse. The U.S. way of life already under threat will be further deminished.
It used to be South America that stabalised the U.S. but they've grown wise. This is a currency war plain and simple.
6:36pm PDT on Oct 4, 2011
Greed is the cause of all the short comings as well as the long falls!
4:23pm PDT on Oct 4, 2011
(Cont)
deserved punishment. It all depends on whether the countries really entered this "Porject" out of good faith and naivité or out of greed and ambition.
Of course, those are the two main reasons people get swindled to begin with.
4:13pm PDT on Oct 4, 2011
To some of us, the whole Euro zone idea seemed like a naive utopia... or a good way for a small bunch to make big money.
This was the equivalent to the "I have a nice iron lattice tower in Paris to sell to you, very cheap". Unfortunately, so many promises were made by so many politicians throughout that many people were fooled and happily agreed to enter the Euro zone and change their currency to Euro.
Excuse me, but what were the real chances of "weaker" countries actually gaining from plaing by the "strong" countries rules and demands? To begin with, we were forced to mutilate our goods production in order to favor import from other countries'. Salaries and prices have never been equivalent throughout the Eurozone (which of course does not benefit weaker economies), free circulation of citizens is not really so (and curiously this has favored immigration from other 3rd world countries). And of course, the basic fear some of us pessimists always had: Is it really that clever to put all eggs in one basket? If one country collapses, won't it drag the others down?
Apparently pessimism was quite realistic. As usual, those taking the biggest part of the blows are always the same ones (the already weak). No doubt someone has beneffited a lot from thsi game (some countries and more than one politician for sure).
I'm stuck in the Euro zone and I still can't figure out whether I should feel sad -and scared- for what's happened, or whether I should feel the present situation is a
10:50am PDT on Oct 4, 2011
Marily L, I would agree with you outright, but my country Britain will not go the German way, Britain does not want a U.S.E, United States of Europe, at the moment the British Government have received a singed 100,000 petition to leave the European Union, this will now be debate after which MP's will vote to hold or not to hold a Referndum of the British Public to leave the EU, If this does happen Britain will be £40 million a day better off.
10:19am PDT on Oct 4, 2011
The EU concept was based on greed and what no one wanted to see was it took away each country's independence. Germany couldn't win dominance in WWI or WWII; it seems they are winning that dominance via the EU. I thought the EU was a bad idea when the concept was revealed and still do.
11:49pm PDT on Oct 3, 2011
cont'd: It's all part of the conservative/corporatocracy plan to end all social benefits to the people & create a New Feudalism. They control the banks (our money) including the FED (which should be owned by the people/country).

The US has the largest deficit in the developed world by far outstretching Greece's or any other EU country. The US debt to GDP ratio is near 100%! If any country is near collapse, it is the US & Calif. is worse off than Greece, so ask yourselves why the US capitalists are trying so hard to destroy the EU starting with Greece? Banking/Corporate incompetence & greed started this crisis according to plans & the US, IMF/World Bank are seeing it thru to the destruction of Europe so the US can rule the world for the benefit of its greedy corporations, as it has done for so long before the EU got strong enough to oppose its empire of evil.

Now that the EU is the leader in the world on human rights & development aid, & the EU is much more respected around the world than the aggressive US, the US can't have that, so it must bring it down. The power of propaganda, but the facts don't bear it out, which doesn't matter as long as people 'believe' the lie. That then makes the self-fulfilling prophecy come true.

It IS an Evil Empire, but one that is about to collapse itself, but following in the footsteps of Rome - too much military spending & too little tax collection = too much debt = collapse. May the Eu & Euro out
11:43pm PDT on Oct 3, 2011
Well, this is what the US wants to happen and the US capitalists have been trying to MAKE happen. The US can't have a strong EU to oppose its militarism and imperialism around the world. The EU is the biggest donor in development aid, despite all the myths about the generous US.

Greece is having a hard time making its payments because the IMF/World Bank are doing to it what they've been doing to other countries for so long - using Shock Economics to destroy them. They wouldn't be having such a struggle if the interest rates weren't suffocating them.

The article mentions the Euro 'falling' to a new low against the dollar. What a joke! The Euro & dollar were meant to be at par when the Euro came out, & the dollar was actually worth more than the Euro at first, but gradually started losing value. So $1.33 to one Euro is still poor showing. It is the dollar that is weak & worthless, so why do the USAmerican ratings companies et al keep saying the Euro is going to collapse? Self-fulfilling prophecy, that's what. They hope to create the belief that it is failing so that people will stop investing in it & the EU.

It's all part of the conservative/corporatocracy plan to end all social benefits to the people & create a New Feudalism. They control the banks (our money) including the FED (which should be owned by the people/country).

The US has the largest deficit in the developed world by far outstretching Greece's or any other EU country. The
10:11pm PDT on Oct 3, 2011
It's good to get a perspective on what's happening around the world. Thank you.
10:09pm PDT on Oct 3, 2011
I have watched the EU for years as it's populations lost jobs to workers being able to simply walk across borders and take jobs from the local towns people. These small countries were doing all right until the powers that be decided that they thought that all the small countries needed to be one big happy family with a new currency. A chicken in every pot. They gave up their own currency and their way of life thinking that everyone was going to be rich embracing the Euro, twenty years later they are overrun with immigrants legal and illegal that the taxpayers have to support with no end in sight. The best thing that these countries can do is start printing their own currency again and try to save themselves and put their own people to work.

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