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Everybody talks about Greece, and there are plenty other topics on this board, but only a few millions people are concerned. So let's not talk about Greece.

I want to raise the bigger issue here, which is the European single currency. Several hundreds millions of people are using it every day, and it's very, very likely that the European currency will go down against the US dollar, the Swiss Franc and BTC. Do you share my concern?

Correct me if i'm wrong, but shouldn't it do exactly the opposite?
Given the fact that EU is now "loosing" Greece, which is nothing but a dead weight; shouldn't the EUR get stronger, since the overall economy of EU will be stronger w/o them. Seams logical,right?

cheers

Probably, Greece is a big liability, every creditor will be affected, some more than others, but the Euro itself probably will get stronger as more stable the eurozone economy get without Greece.

Not really, it's a double edged sword. Sure, you get said "dead weight" but your reputation as an institution whose ultimate goal is a solid unity of nations it basically means you fucked up on this core principle. And bad reputation always means bad news economically. We'll see what happens, it seems the NO is winning.

Losing Greece? It's not so easy. It cannot happen overnight. The NO referendum will bring even more instability that we have now. There are treaties, and several countries may want to kick Greece out of EU (or at least the € zone) as fast as possible, but it can take months, if not years.

Eu does not need to kick Greece out. If the ECB decides not to increase ELA (which is 100% sure) no more money will come out of ATM's.
Since the governments bank accounts are also empty how are they going to pay salaries, pensions and medicare ? They won't so the only option is to print money themselves.

The only thing left for EU is to start sending food supplies in the coming months so the poor people won't starve. I bet the Greek government didn't tell the OXI voters that.

No. Why would it go down against the dollar and bitcoin? The Euro seems to be doing fine. I would like bitcoin to become some sort of unofficial world currency to be used all across the globe. I don't think there would be anything wrong with a one world currency as long as it was decentralized.

this is really tricky..on one hand, Euro should go stronger, because they will not have this big steel Greece ball chained to their legs, in other hand it is really big hit to EU and own currency Euro. All will just depends, how ECB will react to this..

Bitcoin is already going up.
This is the advantage of being a 24h market.
Tomorrow is the opening for currencies exchange markets.

We'll see.

In the meanwhile BTC UP!

Soon usd - eur parity and from there hell will break loose for eur.

Do you think so?
It sounds too early for that only for news from greece.
Remember the greek economy is only the 2% of the whole EU

This isn't the issue. The problem is that the Greeks have said with the referendum that they don't want to pay their debts. So the question is who pay? Will the other European countries pay in place of the Greeks, writing it down at a huge loss, or will the ECB simple print more money, instantly pushing the € down against all other currencies?

How did Greece arrive at this ridiculous situation in the first place?

Overly generous benefits for Gov't workers (including pensions) is a major factor in Greece running up huge debts.

This is probably the same reason England did not want to adopt it in the first place. Their currency is more powerful and they didn't want to be in the same group as the EU, because if one goes down they all suffer unless one fronts the cash to bail them out.

What about corruption at the highest levels?

The Greece voted for no and don't want to pay the debt, leave European.  The priority for them is to pay the debt and try to find a way to get money to pay for them. How come do they still care about the pension cut and tax increases? They still care about their personal income. It is ridiculous. If one family run into deep debt, what they should do? The famility member should try to earn enough money and spend less to pay the debt firstly. How could they keep the moeny for themselft?

That's also my opinion, if the EU (and Merkel) don't give in.  If they give in to Greece, I think the Euro can only go on a steep ride down, because it means that in the end, half of (southern) Europe, including France, will go deficit spending like hell, implying bailouts, and in the end, inflationary pressure.

However, if Merkel can keep strong, and force the Greeks out (even with a "good-bye bailout"), it would mean that the Euro is not for deficit spending sissies.  That would certainly be a point for a stronger Euro than with all that uncertainty about half-failed states and economies "backing" it.

The big problem is Spain, and Greece is its laboratory.  Spain is recovering slowly, but is still in huge problems.  If politically, the Podemos party wins the elections in september (which is the Spanish counterpart of the Greek Syriza), then an exit, or a debt relief of Spain would hurt European economies (especially Germany) much and much harder than the Greek case.   Probably it would make the whole Eurozone go broke, with only one option: inflate the Euro like hell to inflate away the huge debts. 

So everything should now be done to avoid that Spain goes Greece's way.  That's why one cannot be nice to Greece.  It would imply that going broke would pay off in the Eurozone.

Indeed, that's the question now.  And Greece is the small model for Spain.

By lying like hell (helped by Goldman-Sachs, whose European director was Draghi, which is now.... president of the ECB !!).

They had deficits in the 12-15 % and they declared 3 - 4 %.

(Euro rules imply that one shouldn't run a deficit larger than 3% without special permissions).

When the euro was introduced, it was $ 0.8 for one Euro.  So even at parity, the Euro would be 20% up since its introduction....

But what do they mean by 'don't want to pay the debt?' Debts must be paid regardless, they don't have any option regarding that, do they? Leave European? Sure, they don't want you around either. Their reputation has been screwed either way. The people of Greece would of course root to protect their money as it is their own money which they earned, they are not thinking like family. Everybody is trying to save their own ass.

well not really, the fault it is not with the ECB or europe zone, but with greece only, so they are the dead weight here and removing the diseased part of the european would only bring benefit to the euro union, since they do not need to pay loan to a country that can't pay it back ever

weak country like greece should not have entered the EU ever, they were part of the reason, why the euro has lost it's power

You guys still believe this?

Do you want some data?

The European Union was a politically based project. Economy was never going to be a major criterion. If economy was the main criteria, then how could you explain the inclusion of the Eastern bloc members such as Bulgaria and Romania, whose economies are even worse when compared to the Greek one?

you are completely right and this is actually the reason, why something like Euro can never works and just showing huge differences between countries and purchasing power parity.

those other country can handle their loss well, otherwise one can not explain how they are in a better position than greece now, having few money isn't euqal to a bad condition, is the difference between the income and expenditure that counts and apparently greece is not good at it

Dude, you are wrong there. Apart from a few wealthy nations such as France, Germany, the United Kingdom, the Netherlands, and Belgium, most of the other European Union members are in dire economic straits. Do you think that Italy, Spain and Portugal are performing well right now? Greece was just the tip of the iceberg.

Why EUR must go down against USD ? Problems in Greece is problems in only one country and not more  ;D EUR is stable currrency in Europe  ;)

Thank you . Some one had to say it.  Enough about greece ya'll. coming to the point, The Euro seems to be doing  alright.   I would like bitcoin to become some sort of unofficial world currency to be used all across the globe. I don't think there would be anything wrong with a one world currency as long as it was decentralized.

everyone in the world should be scare for every currency handle by the governments because they could to what they want at any time, wake up tomorrow and find banks close and you can only withdraw 60 bucks from the ATM crazy system we have let this banks and governments put us into.

well i'm not talking about italy and spain, but especially romania and bulgaria, the countries that you mentioned in the other quote

greece was doing really bad even before she become a part of the europe zone, their debts were dragged off for so long that is not even funny to remember

But a one world currency which is not controlled or authorized by a committee could be a good and a bad thing altogether. It all depends on the situations of all the countries in that phase, if those countries are in debt, they are poor and they cannot even afford btc, how can they afford to adopt it? Especially after the increase in price just after the mass adoption btc might phase. Its a risky move.

Is my understanding of things incorrect? Isn't it true that no country will ever be able to pay all of its debts back? Ever!

That is correct, that seems to be how most macro economic systems work presently, all fiat currency is based on debt with the country and its people as the collateral. This is by design which is one of the reasons I think these fiat currencies are doomed to fail eventually, especially now that feasible alternative asset based currencies exists. Watching and waiting to see this house of cards fall so that we can finally separate the power over monetary policy from the state like we once did with church and state.

The separation of church and state, that would be an interesting topic to visit. Do you have anything to recommend, either video or literature? Although with the amount of free time which I have I probably have a preference on video.

how greece mini economy affect bitcoin or europe? i really dont understand. can someone explain for me?

If corruption at highest levels alone causes economic meltdown, several countries will cease to exist before Greece goes default  :D

Romania and Bulgaria are two of the most corrupt and crime-ridden nations in the European continent. I agree that the GDP is growing in these nations. But that is solely due to the European Union subsidies and grants. And these two countries don't have the resources to sustain the GDP growth. What happened in Greece will occur in Romania and Bulgaria as well. But in their case, the effects will be even worse.  ;D

So it looks like the Greece drama is nothing compare what is happening in china with their stock market and now letting customers buy stock on margin, here is little more about it http://money.cnn.com/2015/07/06/investing/stocks-market-china-greece/index.html?iid=hp-toplead-dom

well yes, but i was talking about another type, of loan, about the loan that it was lended to save their ass, not about the standard loan that every country of the europe get, because of the vicious circle that is sustaining the whole fiat ecosystem


i don't know, guessing is good and all but the fact is that greece has done something very wrong compared to other, to be in this condition, and they were in a bad situation since 2004 at least which is not too far away from their entry into Europe(2002)

they did a mistake in "recruiting" Greece, on the other hand italy and spain were not in a bad shape before the euro union, i'm not sure about spain, but seeing how i live in italy i'm sure about it

These further loans are inevitable for all nations, in time. Maths dictates.

Just checking you and I have read the same page.

The separation of church of state has many examples historically that prove it to be a good principle. Its beginnings historically can be said to lie within the protestant reformation which gives good examples for why this separation is so important. Later these ideas where further developed in the philosophies of John Locke and Voltaire. It became very important in the American revolution since John Lock's philosophy was important in the thinking of the founding fathers. Thomas Jefferson is often attributed to be the first to use the term as we know it today. You could always read the literature of these individuals which can be very rewarding but of course more time consuming. other wise I would recommend a good historical documentary maybe about the American revolution or the protestant reformation, plenty to be found on YouTube and Bittorent. The first hour of this historical podcast talks about the roots of the protestant reformation as well and is rather entertaining to listen to. :)

http://www.dancarlin.com/product/hardcore-history-48-prophets-of-doom/

I can not think of anything more specific at this moment other then Wikipedia or other articles online. The history makes strong points all by itself though, and shows why this is such an important principle in political philosophy. I hope that one day most people will feel the same way about separating the monetary power from the state as well. :)

I share your concern, but I don't think that the US-dollar is a more secure investment than the Euro. In the end, all fiat currencies will be worthless, because they are constantly inflated.


The effects are not direct, they are indirect: People fear that other countries (Portugal, Spain, France) might collapse as well, since they also have substantial debt burdens. The keyword is "contagion effects" by loosing trust in the safety of government bonds (which are in an epic bubble compared to the debt levels of most western countries). If investors start selling those government bonds, it's possible that governments won't be able to refinance themselves.

ya.ya.yo!

Obviously, I overestimated the market reactions. € is down 0.5% against the dollar, and the Dax (German index) is down 1.5%. It's been a bad day, but we've seen worse. Note that there was more of a reaction with BTC, which is up about 5% in 24 hours.

Still, this isn't over yet. We're still waiting for a solution to the Greek problem, and nothing's in sight.

I think the US is way safer than the Euro. You can hate on the US all you want, but they are still the most powerful nation ever, with the currency that has the biggest network effect ever. Yes, fiat scam and whatnot, but as long as people keep accepting dollars, the dollar is very real. If Ben printed you 1 million dollar, would you accept it, or would you say "I dont want your debt-based fake money".
That's the thing.
Im not saying all fiats are scams prone to end sooner or later, the question here is if they can extend it for ages.

Technically losing Greece doesn't look so bad on paper as it gets rid of dead weight, allows tGreece a chance to declare bankruptcy and clean house. Then under a reset they would have good financials and the possiblilty to rejoin the Union at a future date, but the main concern is that Greece is one part of the dead weight with other struggling components in the union that they will need to deal with at a later date so how it impacts the economy will be a good question.
Also leaving the EU might be bad for their passport and border control but that's not certain atm.

Ah, yes. Thanks for explain. I got my answer :)

What you said (highlighted) can be said for any fiat currency, it's not an argument that the dollar is superior. Of course I would accept a million USD, but I would also accept a million EUR (which still has a bit higher valuation) - but in both cases I would not hold the fiat - I would buy other assets as soon as possible.

The USD has the biggest network effect now - but there's not much more room for growth, so the magnitude of the USD dominance could also be interpreted as a risk factor.

ya.ya.yo!

Most debts are paid back 100%. Germany has a lot of debt, and so does Japan, Belgium or France, and these countries have always paid back in full. A few lousy countries in Africa, or Argentina, haven't paid back, and they're now blacklisted everywhere.

Back to the subject, it seems the small reaction we've seen yesterday is already forgotten. Everything looks like it's business as usual. Surprising...

Eurozone is not ganna be shaken by Greece as much as you might think. This country is not important in the bigger picture. They didn't have anything worthy beside tourist attractions.
Greece lost even this because who is gonna visit them now, when crisis is raging? Euro as a currency is safe, I would be more worried about recent news from Asian markets. Huge Asian crisis incoming.

There's every reason to be concerned if you are hopeful for a strong Euro.  The Euro-Zone is afraid of what other countries like Greece may do.  It is widely accepted that Greece going back to their own currency is in the best interest of Greece but bad for the Euro because those in charge of the Euro lose money so the Euro does poorer.  And there are other countries that may end up doing what Greece has done.  The Euro Zone will have to reconsider how they address debt collection and debt management if they want all of Europe to participate.

The markets didn't crash, as everyone was expecting a NO vote in the Greek referendum. But it will be wrong to say that the Eurozone is not going to get affected as a result of this.


Most of the tourists to Greece come from countries such as Russia and China, which are outside the Eurozone. So I am not predicting a significant dip in the Greek tourism sector.

Losing Greece has its pros and cons for Europe. Greece with its unpayable debt was like a dead property which should be getting removed , but Greece is a country itself which should not measured just by its financial terms , but also the sentiment of people living in it. It was a distortion of Europe's principle of keeping all the countries under it intact. Greece lost it , but somewhere the whole Eurozone lost the challenge.

It does raise the question of where Greece goes if they do decide to leave the Eurozone.
The Russians are willing to welcome them with open arms into the BRICS and it does seem like a good choice if they do leave the European Union and it does explain why the tone seems to be changing in the EU so much for those sanctions.
http://www.ibtimes.com/greece-can-easily-get-funding-brics-bank-russia-1998515

Do you really think so? Bad days are no doubt ahead for the Eurozone. But there's always a light in the end of the tunnel. Countries round the globe have suffered worse. But then gradually they pick up the mess , clean it up and move on to become stronger,. That's how we need to look at it. We need to have a positive approach towards it. That's how it works.

What will happened if greece fails? euro will go up or down?

Defaults happen all the time, there's nothing revolutionary about it. What's shocking is how the bureaucrats are basically telling people what to vote. "If you don't vote Yes, this will happen to you". Greece just should default at this point, tons of countries have defaulted before, its not the end of the world.

it's already going down massively, not soo long before we can touch 1:1 ratio, i believe that in the case of the greece will be out of europe, the price might drop to 0.9 for a short time

I can't understand why the Greeks are so awful. They had their referendum last Sunday, the whole of Europe was waiting for them to go back to the negotiating table on Monday, but they waited till this late evening to show some proposals. 5 months of bargaining already, and this isn't over, they just made us wait another 4 days. They want a debt reduction? A haircut as some people like to say, I suggest they'll get one, a small one, on the very condition they leave the European Union for good.

The European people and the European currency would be better without them.

Now everything is gone (almost for the moment) so don't exist more such risks for the euro but the if Greece or some other country of Eurozone will go out of European countries which use euro as their currency, euro will suffer to much. It were be in discussion even its existence. Were and yet are to many the articles in internet that explain in details this event. In this point of view I think that if Greece would be already out of Eurozone the value of euro will be decreased, notably with the main currencies (such us dollar, British pound, Swiss franc and Japanese yen). As for being better without Greece I have my doubt. Even I am very critic with them about to many things and with their behavior in these times.