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To add to the other Greece Breaking News story (Greece Defaults, Still Wants Bailout)....
The Ars Writes:
Thom Feeney, a London shoe shop worker who started a campaign to raise €1.6 billion (that's US $1.78 billion). Feeney's IndieGoGo campaign, started just two days ago, has already raised an astonishing €478,575 (or $533,010) from more than 30,000 people.
"All this dithering over Greece is getting boring," Feeney wrote on his IndieGoGo page. "Why don't we the people just sort it instead?" He added that to come up with the €1.6 billion, every member of Europe would only have to give €3 each (well, technically you'd only need to collect from members of the European Union; that's not even counting any potentially generous Swiss or Norwegian people.)
The campaign has six days left to raise money. If €1.6 billion isn't raised, all the donors will get back their money.
This afternoon, the International Monetary Fund (IMF) declared that Greece was officially in arrears, but it has not yet declared that Greece is in default. Technically, the IMF could offer Greece an extension of its debt repayment obligation. On July 5, the country will hold a national referendum on whether to sign a deal demanding even stricter austerity from the nation.
But, if Europeans all chip in, maybe we can just put this silly bailout business behind us.
Original Submission
(Score: 0) by Anonymous Coward on Thursday July 02 2015, @12:52PM
The creditors, largely European banks, were foolish enough to lend the money, but that doesn't absolve the Greeks from the contract they entered into willingly and also foolishly.
(Score: 5, Insightful) by c0lo on Thursday July 02 2015, @01:10PM
The current creditors were previously fooled by Greece helped by some US swindlers [spiegel.de].
https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford
(Score: 3, Interesting) by Anonymous Coward on Thursday July 02 2015, @03:10PM
When you take on a loan, the offset of the risk that is taken on by the lender is what they call the interest. That is why it exists: I take on risk to lend you money which you may not pay me back so I'm taking on interest so that I cover that risk. All in all and over all the loans I make, I'll come out ahead with my risk covered and a good bit of extra profit out of it.
I don't have a problem with anyone making a profit, but interest is not some inalienable right you as a holder of capital have to increase your owned pool of money.
The creditors did lend money to Greece and received interest for years. If all went well, the lenders would have made a nice, big fat wad of cash. Sadly it didn't but it was the creditors that took on the risk with the promise of interest.
Years ago, there was a housing crisis. You may remember remnants of it in the back of your head. Banks took on huge risks and everyone balked at bailing them out. Everyone inherently felt that something was morally wrong with that. Everyone was convinced that the banks got what they deserved, they took on the bet and lost. But we still bailed them out to the dismay of many because 'the financial system would collapse otherwise'.
And how exactly is this situation different from the housing crisis? Banks and lenders took on huge risk by lending Greece money and now may not be paid back. Once again there are threats of 'whole systems collapsing' (Euro[pe]) if we don't do *something*.
Essentially, it's the same problem: lenders took on a bet that they would get incredibly nicely rewarded for when all went well but for which they weren't willing to bear the consequences in case the bet went sour.
But there is a difference this time, and that is that it's not a couple of million individuals who can't pay back their mortgage; /those/ guys were an amorphous blob that you can't easily point at with your little wagging finger. Those guys were your average neighbour who's "a cool guy". You don't want to hurt Joe Schmo who's daughter is the girlfriend of your son, no sir-ee...
This time, it's a country, a different country than yours, it's a single entity. Something very easily pointed at and deamonized: "Ahhh.. those no-good, lazy, early-retiring Greeks.... they got what they deserved... let them suffer and rot in hell." That makes you feel good because you can attribute blame without having to consider the different factors that lead up to it.
Slipping into this kind of thinking is so much easier and so much more satisfying than actually thinking deeply about the situation.
Now I'm not saying that for years, Greece didn't live outside of its financial means. I think it is well established that they did. But I think that it's just a tad too easy to have that be the be-all-and-end-all argument in the discussion.
What we don't hear about is how Europe never knew about this. I seriously doubt that Europe didn't know this. They go through the budgets with fine-tooth combs and penalize countries who submit budgets that are not in line with regulations. Either these people didn't do their job or they ignored the warning signs. I find the argument that "Greece lied" to be a very weak one, especially because they 'found out about it' when it is super-convenient for them. Based on what I hear around the Commission, Europe knew, and never decided to do anything!
Because all was well in Euro-land. It was boom-times and no one raised any questions when the going was good. Now that the going is not so good, they need a scapegoat that they can bring to the altar and slit its throat in plain sight for everyone to see, just to show people that they are doing something. This 'sacrifice' is going to be equally effective as the human sacrifices made by the Aztecs back in the day.
But Greece is suffering in the process which makes us feel good. And it just ties in nicely with the perceived need for atonement in order to be 'cleansed of this badness'. In order to be helped you have to suffer first. Suffering is good because it makes us feel better about ourselves.
Ugh, call me a cynic...
(Score: 0) by Anonymous Coward on Thursday July 02 2015, @06:21PM
When you take on a loan, the offset of the risk that is taken on by the lender is what they call the interest.
That is not entirely accurate. Interest is not used to offset default risks. If there is some risk the borrower will default, money is not lent at low interest (opposite of the case of Greece, which hid its real debt using derivatives). And if money is lent, the interest rate is very high making it infeasible for the borrower. What interest do you think you will charge Greece if you lend it money today (considering there is a high chance you will never get your money back)? And what interest would you charge France or Germany today (with no chance of default)?
However, interest payments can be used to buy credit default swaps and other derivatives in case the borrower defaults. But this is Europe, so I'm not sure they use CDS's much.
Based on what I hear around the Commission, Europe knew, and never decided to do anything
So now its Europe's fault?
Suffering is good because it makes us feel better about ourselves
But they are not children and they knew they had to pay borrowed money back. When its time to pay, its time to pay and no amount of noise will save you. Same rules for all.
(Score: 1) by khallow on Friday July 03 2015, @12:58AM
Interest is not used to offset default risks. If there is some risk the borrower will default, money is not lent at low interest
Nonsense. Someone the other day mentioned Argentina both its multiple defaults over the decades and the current 10+% interest rates it pays for debt. A replier noted that the unusually high interest rate was precisely due to the default risk premium that Argentina had to pay in order to borrow that money. And that's pretty much what you say in the second sentence. Of course, if the borrower is flaky enough, then no one will lend without collateral at any interest rate.
(Score: 2) by Geotti on Friday July 03 2015, @01:27AM
they need a scapegoat that they can bring to the altar and slit its throat in plain sight for everyone to see, just to show people that they are doing something.
What might actually be closer to the truth is, though:
they need an example that they can bring to the altar and slit its throat in plain sight for everyone to see, just to show people that they are doing something wrong if they think they can elect any change.