IMF And EU Consider Plan To Allow Greece To Write Down Debt As Banksters Realize The Obvious - Greece Is Going To Default
Although the timing of this isn’t that important, I wanted to get this up while it is still relatively fresh.
We have been highly critical of austerity plans whether they are in the U.S. or elsewhere. Austerity if a failed ideology of the status quo. (By the way, so is the debt for equity idea put forth by Nassim Taleb. I like Taleb but his idea will not work. Neither austerity nor DFE addresses the fundamental issue driving this crisis. As we have said bazillions of times, this is not a problem of debt. Debt is but one of many symptoms of a failed economic ideology.) Even Marc Faber, one of our favorites, remarked in a recent video we put up that the U.S. needs an austerity plan. Um, no we don’t. What we need is a new economic model.
We uniquely wrote a year before the 2008 crash and a few times since of what would eventually be termed unwinding as the crash of 2008 unfolded. And then just as now, I can tell you with 100% certainty that austerity leads to the same unwinding and eventual crash. It perpetuates an environment of lower and lower living standards as cuts lead to even less ability to pay debts that lead to even more cuts. The process is one that never ends until society has been decimated. If you don’t quite understand this dynamic, then you should at least wonder why the status quo, corporatist politicians and the corrupt banksters support austerity. Do you actually think these people care at all about you or in the case of politicians, have any clue what they are talking about?
Austerity’s cycle is vicious and endless. Whether it is Governor Christie in New Jersey or Prime Minister Papandreou in Greece, these are failed ideologies that will lead to even more misery. Do government’s need to get their houses in order like the rest of us? Yes. Can the U.S. spend a trillion dollars a year on defense and still have a vibrant economy? Absolutely not. We don’t need bankster-supported ideologues destroying the living standards of necessary government workers and necessary government social services just because these same crooks have been successful at doing so in the private sector. Massive wage and benefit cuts in the public sector has support because of the most ugly of aspects of the human condition - if I have to suffer, then they do as well. Better known as misery loves company or schadenfreude.
Massive public sector cuts without private sector gains will lead to more private sector job losses. We see this in Greece today. Austerity has led to a crash in the money supply and that means default could happen much more rapidly than anyone expected. That is the only reason why the EU and IMF are rushing into this toxic mess they have created. And the same thing would happen in the U.S. with similar austerity plans. Yes, we need to fix the public pension issues and those will involve substantial haircuts. Yes, we need to rationalize the size of government. Yes, we need to fix government and have it work for people rather than corporations and scumbag lobbyists. But those espousing this environment is all somehow because of public unions are ridiculous. Karma is a bitch and wishing misery on others manifests its outcome in many unexpected ways. One would be misery and even job loss on those supporting such efforts.
We need a sovereign-specific policy of raising the economic opportunity and living standards in the private sector along with fiscal responsibility in the public sector to rebalance the public sector funding crisis. The U.S. economy once roared when it had debt levels similar to today. We we were able to pay down our debts at a rapid clip. Our problem is not debt. If you believe this is impossible today, you are hoodwinked by crooks and people espousing positions they don’t understand. It is more than possible and we have written on here that the U.S, with the right economic policies could have 2% unemployment within a handful of years. (All of those people citing debt as a cause of the Great Depression are clueless. As we have noted before, debt did not cause the Great Depression.)
Our position has been that Greek should default on its foreign debt and reclaim its sovereignty and along with it institute a public banking system. Greece’s current debts primarily benefited the status quo’s fraud rather than democracy. This same dynamic is the reason why we have such massive debt in the U.S. It’s also why the U.S. should either default or monetize its debts. Our debts benefited fraud and elites while saddling the rest of us with their massive corruption. (Unlike Greece, the U.S. has no foreign debts and our policy makers could easily monetize our debts. And that is what we wrote would eventually happen. No histrionics please. Under the right policies it would have zero impact on inflation. Again, lies perpetrated by know-nothing ideologues and banksters.)
It is now apparent that Greece is guaranteed to default and possibly yet this year. When the Greek austerity plan was announced, we said default was imminent. Similar plans in the U.S. will lead to similar crises.
Restructuring Greece’s debt still doesn’t do anything to solve Greece’s economic problems but it may be a realization to the crooks that default and total loss is imminent without some debt restructuring or forgiveness. And that would mean Greece’s exit of the EU is also imminent. That is the only reason the EU and IMF, two self-serving corrupt organizations are coming to the aid of Greece. If Greece cannot regain economic sovereignty within the constructs of the EU, then it needs to leave the EU to actually institute policies required for a sustainable recovery.
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