First Greece...who next?

[Elwar]

Japan is primed for a collapse.

And look who's coming in with the third highest debt to GDP ratio after Greece...

[Don007]

I don't really think that it is only the gross debt that determines whether the economic system of a country is going to collapse or not.

When we take a look at Greece, they could easily receive more money from the EU by just applying to the given rules. However, they appear to be too stubborn. Sure, these rules are not nice, but if you see how much money the EU is pumping into Greece (in order to try to save it, remember that!) I think they're in a position to set the rules.

[Elwar]

I don't really think that it is only the gross debt that determines whether the economic system of a country is going to collapse or not.

When we take a look at Greece, they could easily receive more money from the EU by just applying to the given rules. However, they appear to be too stubborn. Sure, these rules are not nice, but if you see how much money the EU is pumping into Greece (in order to try to save it, remember that!) I think they're in a position to set the rules.

They sacrifice some sovereignty for a bail out from the EU because their debt is out of control and they can't pay for it.

They can do that. The US debt is out of control and they have no outside entity to sacrifice their sovereignty to for a bailout.

Other than the Federal Reserve who will have to print out a whole lot more money.

[OROBTC]

...

Here's what I would be watching for.

1) If there is a "contagion" (problems similar to Cyprus & Greece spreading to countries like Spain & Italy), and if the negotiations for other countries go poorly, then bigger countries like France are at risk.  If France has big problems, then Germany will for sure.  If Germany looks like it will go over the falls, then the USA will too -- in 48 hours, maybe less.

2) Perhaps the ECB and European leaders will decide to "Ctrl P", print the money to cover losses from Greece.  Zero Hedge JUST reported that the Euro was down almost 1.5% (trading started some 40 minutes ago if I read that right).  1.5% is a big move in foreign exchange.

3) One should not forget about or ignore Japan and China.  Both are places where an accident could easily happen.

4) My guess is that the US$ will be a relative safe haven, for at least a while.

*   *   *

Watching and taking action are two different things.  Even in America it now seems prudent to have a big chunk of CA$H outside the banks now.

Gold and Bitcoin too.

[Don007]

Watching and taking action are two different things.  Even in America it now seems prudent to have a big chunk of CA$H outside the banks now.

Gold and Bitcoin too.

To have some chunks of cashs and other kind of currency (like Bitcoin), and things like gold etc is a wise choice if you ask me. I'm afraid that once Greece actually collapse, indeed more countries might follow. If that happens, I think an effect will be triggered that more countries (and bigger countries) will face the same future. If we are really going to experience national and international bank runs and other problems with our economic system, I  think Bitcoin and gold, silver etc will be worth much more: or, better said, will be worth at least something.

[expert4knowledge]

Japan is primed for a collapse.

And look who's coming in with the third highest debt to GDP ratio after Greece...

Japan has a stronger economy with much more exports and more reserves, in fact some american banks made the Greece bankrupt

[bryant.coleman]

Most of the Japanese debt is being held by the Japanese passport holders, unlike the case in Greece and the United States, where foreign institutions are holding a majority of the national debt. And the Japanese are doing their best to bring down the national debt, with some success achieved during the last few years. Japan is in a much better position, when compared to the United States.

[qiwoman2]

Japan is primed for a collapse.

And look who's coming in with the third highest debt to GDP ratio after Greece...

Japan has a stronger economy with much more exports and more reserves, in fact some american banks made the Greece bankrupt

I agree WALL ST was one of the main reasons Greece crashed..and no one talks about this..Also the phat corrupt politicians and judicial system in Greece and also EU laws..Greece being the cradle of democracy itself by principle alone has to stand up to the bullying and reform its own house. Now there is a ministry of corruption so if that gets to work and weed out all the nasties, gather up all the black monies that were taken out of the country by the elite, punish through a strong justice system all those that crippled the country by default and bring in alternative economic solutions to the Country, then things can get better for the Greeks. If China starts selling the U.S trillions of bonds it holds, then we see how the U.S Economy will get pear shaped but for now China is holding the U.S in its hands..

[Miracal]

Consider what happens to a population that is A) shrinking, while B) the government continues to pile on additional debts to stimulate the economy, which is exactly what Japan is doing with its last-gasp Abenomics economic policies.

[bryant.coleman]

Consider what happens to a population that is A) shrinking, while B) the government continues to pile on additional debts to stimulate the economy, which is exactly what Japan is doing with its last-gasp Abenomics economic policies.

Right now more than 60% of the Japanese tax revenues are used for servicing the debt. This is a huge amount, and can't go on for ever. They need to decrease their spending, especially in the defense sector. But right now, I don't think that it is possible, as the threat of a Chinese invasion is looming large.

[qiwoman2]

Consider what happens to a population that is A) shrinking, while B) the government continues to pile on additional debts to stimulate the economy, which is exactly what Japan is doing with its last-gasp Abenomics economic policies.

Right now more than 60% of the Japanese tax revenues are used for servicing the debt. This is a huge amount, and can't go on for ever. They need to decrease their spending, especially in the defense sector. But right now, I don't think that it is possible, as the threat of a Chinese invasion is looming large.

Also the older population are living very long and there is a labor shortage and big burden on the young as many Japanese are not getting married or having children. There is a big demographic problem at present in Japan that needs to be addressed if the rest of the economic issues need to get solved. The same with Greece, you have too much of the population living in the cities so infrastructure in the small towns and villages and agriculture along with small manufacturing has to blossom again.

[TinEye]

japan situation is different they are not under a central authority, they are under their own istituion, their crisis can be fixed like greece would fix their economic issue when it will leave europe, on the other hand, italy seems to be the third that is akin to greece, i think they have a bigger chance to be the next one

[bryant.coleman]

Also the older population are living very long and there is a labor shortage and big burden on the young as many Japanese are not getting married or having children. There is a big demographic problem at present in Japan that needs to be addressed if the rest of the economic issues need to get solved. The same with Greece, you have too much of the population living in the cities so infrastructure in the small towns and villages and agriculture along with small manufacturing has to blossom again.

A lot of discussions have been ongoing on the Japanese demographic crisis. But still, I feel that the demography there isn't as bad as some people would like to project. The birth rates are really low, but recently Japan overtook Germany in that parameter. This is a big achievement, considering that Japan is a homogenous society with uniform birth rate across the regions, and Germany is a multicultural society with a large high-fertility immigrant population. Also, the health sector in Japan is quite impressive, making it possible for retirement age to be extended considerably.

[Xialla]

I expected other countries from south Europe like Spain, Portugal, Italy, Malta...Japan is imho different case and those graphs are not applicable for them like for EU countries..

[Kprawn]

How many of the PIIGS - Portugal, Ireland, Italy, Greece and Spain are stronger after the economic recession which started in 2008?

These countries received huge bailouts and some are still feeling the affects of this.

Most of these problems started with having too much sovereign debt. As long as these countries have a strong economy the sovereign debt would not be a problem.

Greece have a weak economy linked to a corrupt government.. 

[Amph]

i think greece is an exception, because, if i'm not mistaken Greece's economy was weak even before the entrance to the eurozone, so it's not european union fault , on the other hand i don't recall any other weak(in economy) country that entered the eurozone

so it is unlikely that we get another case like that for the time being

[bryant.coleman]

i think greece is an exception, because, if i'm not mistaken Greece's economy was weak even before the entrance to the eurozone, so it's not european union fault , on the other hand i don't recall any other weak(in economy) country that entered the eurozone

The Greek economy was in a much better state, when compared to that of its neighbors (such as Bulgaria). But what happened is that, once Greece was given the EU membership and access to loans, the governing politicians from the PASOK and the New Democracy used that opportunity to get themselves rich. These two parties engaged in unprecendented corruption, and the EU never complained about it. But now the EU is having problems with the SYRIZA government, as they are trying to revive Greece.

[dblink]

Greece have a weak economy linked to a corrupt government.. 

According to me one of the main reason for Greece economy fall out would be hosting the Olympics in 2004, which cost them the much money than the actual estimation of €4.5 billion. Did Greece has taken the right decision when they join the Euro ?

[RustyNomad]

Puerto Rico....

...the default wave has jumped the Atlantic and has hit Puerto Rico whose governor Alejandro García Padilla, saying he needs to pull the island out of a “death spiral,” has concluded that the commonwealth cannot pay its roughly $72 billion in debts, an admission that will probably have wide-reaching financial repercussions....

http://www.zerohedge.com/news/2015-06-28/here-comes-prexit-puerto-rico-death-spiral-governor-says-debts-are-not-payable-refus

[bryant.coleman]

According to me one of the main reason for Greece economy fall out would be hosting the Olympics in 2004, which cost them the much money than the actual estimation of €4.5 billion. Did Greece has taken the right decision when they join the Euro ?

The 2004 Olympics is just the tip of an iceberg. The initial costs were estimated at €4.5 billion, and they ended up spending almost €10 billion. According to the researchers, more than half of that amount was lost as a result of corruption and mismanagement, and was moved quickly out of the country to various offshore tax havens.