The European Debt Crisis Visualized

[xingming]

They will inject one trillion into the zone of euro , But i can say that they real hate bitcoin maybe its a punishment 

[1714879777]

1714879777

[1714879777]

1714879777

[1714879777]

1714879777

[Freshlikeduggie]

Most Eurozone countries debt to GDP (with the exceptions of Greece and Italy) was manageable and even going down before Fannie Mae, Freddie Mac, NINJA loans, synthetic CDO's etc but with the aid of smoke and mirrors this is forgotten.

[AtheistAKASaneBrain]

It's not just Europe that's a problem.  there needs to be worldwide economic oversight in order to stop price gouging and to ensure appropriate values.   New world order!!

Bill gate's global goverment and global centralized e-currency will save us.

[johnyj]

From micro point of view, it is very natural to think that if everyone's net expense is less than their net income, they will get richer and richer and pay back the debt eventually

From macro point of view, in today's money based society, it is impossible. If the total amount of money at any given time frame is constant, one man's profit is always another one's loss, the net result of the whole nation will be zero (In fact negative, due to frictions in transactions and interests)

In order to let everyone to have a positive result, money available in society must keep increasing. Those money enter society in form of loans, either private, commercial or government loan. So, without loan, no new money, thus no net positive result for the whole economy

Under a gold standard, new money enter the society in forms of freshly mined gold, and it is not created by loan, so no loan is required to increase the money supply. When everyone want to make more money, they just need to dig out some more gold. However in today's system, if everyone want to make some money, they have to take out loans, it is those who take out loans enabled others to make money

[oblivi]

Visualize a building in the process of being demolished, thats Greece.

[steveturk]

[twiifm]

Defecit spending is how money moves into the private sector.

Because the govt can print money it's their responsibility to spend it to keep the economy moving along

[Q7]

No matter what it will not work out. Those not in debt will not be obliged to pay for those in debt and those in debt will not listen to the terms of condition.

[dinofelis]

Defecit spending is how money moves into the private sector.

Because the govt can print money it's their responsibility to spend it to keep the economy moving along

This is assuming that the private entities are not customers of private entities.  That you don't buy any bread, and that the butcher is not using your services as a plumber, and as if all economic initiative came from public works.  Nothing is less true.  Public works and public spending are, most of the time, largely useless activities to make rich those people who don't produce much useful stuff (state agents, or companies working on state funding).  I'm not saying they are 100% useless.  Often they do have 10% utility or so.  

You see, the state spending is akin of the state using money to employ people who dig holes in the ground in the morning, and who employ other people who refill these holes in the afternoon.  That's a lot of economic activity.  A lot of people "work" a lot.  They are tired when they go home.  They have been digging a lot.  Their hands are sour.  They have a back ache.  If you would tell them that they are lazy, they would be - rightly - feel insulted.  
The company that provides "digging service" and the company that provides "hole filling service" to the state can bill the state large bills.  They employ a lot of people.  They are important in the country's economy.

But they produce zilch value.  The economic output of all that digging and hole filling is zero.

But the state has to provide these companies (richly) with means, so that these people can buy bread, houses, meat, vegetables, send their kids to school....

So the state has to take that somewhere, from people who bake bread, grow vegetables, teach kids, build houses, to give it to the hole diggers and the hole fillers, and more so to the CEO of the companies employed to dig holes and to fill holes.

And yes, sometimes a hole dug in the ground can be useful.  That is then the reason used to justify the huge amount of resources that go to the hole digger companies.

Yeah, the state is stimulating the economy that way :-)

[dinofelis]

From micro point of view, it is very natural to think that if everyone's net expense is less than their net income, they will get richer and richer and pay back the debt eventually

From macro point of view, in today's money based society, it is impossible. If the total amount of money at any given time frame is constant, one man's profit is always another one's loss, the net result of the whole nation will be zero (In fact negative, due to frictions in transactions and interests)

This is not true.  You are confusing money amount and money flows.  If the amount of money is constant, it is a conservative system in which a conservation law holds, and all fluxes balance.

Wealth is not the amount of money, but the utility that takes the opposite flow to the money flow.

If you have a cow, and I have 20 chicken, and you value my chicken more than your cow, and I value your cow more than my chicken, then we could exchange those, and both gain in utility.  We could apply barter, or we could use money, or we could use debt.

If we use money, I first buy your cow, and with that money you buy my chicken.  Money has flown, money is constant in amount, and we both won in utility (just as with a barter exchange).

The complex web of money flows does exactly the same.

Interest is nothing else but another money flow, of which both parties find an increase in utility by doing so.

If I borrow money to buy a house NOW, and I pay you back the money, with interest, then the only thing that happens is that there is a certain money flow from me to you (the interest) of which the utility for me is that I have my house NOW and not 20 years from now, which is to me much more useful than to have to live 20 years in a cardboard box while saving for my house.  That money flow (the interest to you) is provided for by me working for an employer, who gives me a salary (another money flow) because he thinks that my working is more useful for him than the salary he provides me, and I'm happy with that salary because my time is worth less for me than the money I receive.  My boss and I, we both win in utility.  A part of that money flow to me goes into paying the interest to you, of which I also agreed that paying that interest is less costly to me than not having my house right now.
So we all win with these flows.  If you use your money flow from me (the interest) to be a customer of my boss, and you pay my boss for some of the products he makes, the circle is closed, all money flows are conservative (that is, they respect a conservation law), and they are opposite to a service and goods flow that by itself is the result of a double increase in utility.

No money creation is necessary.

[picolo]

No matter what it will not work out. Those not in debt will not be obliged to pay for those in debt and those in debt will not listen to the terms of condition.

Europe has been paying a lot for Greece so far.

[redsn0w]

"Minutes ago, eurozone finance ministers announced that they've agreed to give Greece four months of breathing room in which to get its financial house in order. In that time, Greece will either work out a debt restructuring with its creditors or create a fully-functioning economy capable of managing the developed world's second highest ratio of government debt-to-GDP."

Source : http://www.marketoracle.co.uk/Article49525.html

What do you think guys, Can the Greece go  "back" as it was before or not?

[neurotypical]

Greece is such a beautiful place. It's such a shame that it has been oblitared due back economical policies and corruption.

[ajareselde]

"Minutes ago, eurozone finance ministers announced that they've agreed to give Greece four months of breathing room in which to get its financial house in order. In that time, Greece will either work out a debt restructuring with its creditors or create a fully-functioning economy capable of managing the developed world's second highest ratio of government debt-to-GDP."

Source : http://www.marketoracle.co.uk/Article49525.html

What do you think guys, Can the Greece go  "back" as it was before or not?

" It's not a surprise that putting them off is easier than facing them head-on."  - This pretty much sums it up. Greece wants to spend and borrow, and yet fails to even listen about paying it back.
Doesnt surprise me the EU heads are having a hard time comprehending such an idiotic behaviour.

cheers

[xingming]

The Europe Crisis will not end expect they let greece crisis . Also they should take care about
The king of spain he's   

[AtheistAKASaneBrain]

It looks like Varoufakis is already giving up and doing stuff that they said they wouldn't do..

[BootstrapCoinDev]

"Minutes ago, eurozone finance ministers announced that they've agreed to give Greece four months of breathing room in which to get its financial house in order. In that time, Greece will either work out a debt restructuring with its creditors or create a fully-functioning economy capable of managing the developed world's second highest ratio of government debt-to-GDP."

Source : http://www.marketoracle.co.uk/Article49525.html

What do you think guys, Can the Greece go  "back" as it was before or not?

" It's not a surprise that putting them off is easier than facing them head-on."  - This pretty much sums it up. Greece wants to spend and borrow, and yet fails to even listen about paying it back.
Doesnt surprise me the EU heads are having a hard time comprehending such an idiotic behaviour.

cheers

If this deal has been done, but none of the money gets released very soon, that seems to me that Greece is still bankrupt as it has a cash flow crisis that the conditions and timing on the release of money mean they cannot meet before bills become due.

[redsn0w]

This actual economy (as I always thought) is only a tease, and I think the situation will never change  maybe only with a real "revolution" : |A forcible overthrow of a government or social order, in favour of a new system|.