Posted on 02/22/2012 2:59:04 PM PST by robowombat
Independent Institute Senior Fellow Alvaro Vargas Llosa points out that no matter the austerity measures instituted by Greece, the country remains insolvent.
.........
The reason is simple: because Greece has been in default for quite some time. Greek sovereign bonds are in fact a myth.
The current negotiations between Greece’s private creditors and the Greek government (really, the European Union) – aimed at finding a solution to the more than 14-billion-Euro debt that will mature in March – is therefore fiction.
What is the meaning, otherwise, of the fact that private creditors are now proposing to forgive up to 70 percent of Greece’s debt?
If I lend 100 dollars to a friend and after a while I tell him that I’ll call it “even” if he pays me back 30 bucks, what I’m really saying is: “At least pay me something so my wife doesn´t kick me out of the house in shame because she married such an idiot!” And what, if not default, is the meaning of the fact that the Greek government (really, the European Union) is resisting that amazing offer with the argument that the creditors are asking for too high an interest rate on the new bonds that would replace the existing ones?
For much of its history, the border between mythology and reality were confused in Greece. Pericles, for example, was able to maintain the fiction that there was enough money to pay for his Athenian empire thanks to his reliance on the Delian League, but that was plundering, not production – and Pericles’ myth ended in ruin. For a while it seemed that the Greeks were able to separate mythology from reality, but now the old tradition seems to have returned.
(Excerpt) Read more at forbes.com ...
He forgets receivership, where Greece can be auctioned off to the highest bidder to pay off it’s outstanding loans.
Sure, it ends the nation of Greece, but historically, bankrupt nations have always ended up as parts of more fiscally healthy nations in the first place.
Quite right. The detritus of the Soviet Union were auctioned off too. The buyers are called the oligarchs of Russia, the people who share the political power. One of them bought a NYC apartment for $88 million sight unseen. Greece is selling islands. The once State owned Italian energy company is 55% privately owned. All were sold at rock bottom prices, kinda like FL real estate right now.
>>bankrupt nations have always ended up as parts of more fiscally healthy nations in the first place.<<
The CBO estimates our economy will blow up in 15 years. Zero Hedge reported yesterday that 1% was added to our debt since we hit 100% of GDP only 21 days ago. Yes, 21 days to go from 100% to 101% of DEBT/GDP.
When the time arrives, I suppose a consortium including Soros and the Russian oligarchs will be at hand to buy US federal properties for pennies on the current dollar.
It’ll probably be the Chinese and India that buy us out.
I’ll head to the India-owned territories.
Soros will most likely be dead in 15 years.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.