The European Debt Crisis Visualized

[redsn0w]

Feb. 12 (Bloomberg) -- At the heart of the European debt crisis is the euro, the currency that tied together 18 countries in an intimate manner. So when one country teeters on the brink of financial collapse, the entire continent is at risk. How did such a flawed system come to be? Bloomberg Television and Jonathan Jarvis present "The European Debt Crisis Visualized." (Source: Bloomberg)

This is the video :



https://www.youtube.com/watch?v=C8xAXJx9WJ8


What do you think?

[dinofelis]

Feb. 12 (Bloomberg) -- At the heart of the European debt crisis is the euro, the currency that tied together 18 countries in an intimate manner. So when one country teeters on the brink of financial collapse, the entire continent is at risk. How did such a flawed system come to be? Bloomberg Television and Jonathan Jarvis present "The European Debt Crisis Visualized." (Source: Bloomberg)

This is the video : https://www.youtube.com/watch?v=C8xAXJx9WJ8


What do you think?

The Euro itself is not the culprit.  In fact, the Euro is much closer to a sound money doctrine than any other fiat currency is.  It is not totally sound money, in the sense that a pre-set CPI inflation of 2% target is set for the ECB, but for the rest, it is sound money, that is independent of any "monetary policy", and just issues an amount of money that is supposed to reach blindly the target.

What is the culprit, is that states cannot handle sound money.  States have, since ages, been used to take seigniorage.  What happens with the Euro is that they can't anymore, and that is why STATES go broke under the Euro.  Just as states went broke under gold too.

If states are put in a situation where they cannot tamper with money for seigniorage, they go broke.

That's what's happening in the Euro zone.  The Euro is one of the best-designed fiat currencies ever (that still makes it a fiat currency that has all the problems of fiat, but amongst the fiat currencies, the Euro is definitely the best).  But states can't handle sound money.

With the Euro (as was the case with gold), states are an economic agent as any other concerning their monetary balances.  If they try to cheat on their balances, it will show in the end - contrary to when they can change the money supply.

Now, what do we have to do ?

Kill the Euro, and have states tamper again with money ?  Or have states get their balances right, as any economic agent ?

[johnyj]

Feb. 12 (Bloomberg) -- At the heart of the European debt crisis is the euro, the currency that tied together 18 countries in an intimate manner. So when one country teeters on the brink of financial collapse, the entire continent is at risk. How did such a flawed system come to be? Bloomberg Television and Jonathan Jarvis present "The European Debt Crisis Visualized." (Source: Bloomberg)

This is the video : https://www.youtube.com/watch?v=C8xAXJx9WJ8


What do you think?

Have seen this debate since 2011, there is no solution, borrow more is the only way out, and followed by a total default eventually

Greek is just the one to blame, remove Greek, some other country will become the one to blame. With debt based money issuing, there is no way to get a positive return for all the countries in EU as a whole, means they must borrow more and more to finance their debt, without Greek's debt spending, where does Germany's income coming from?

[picolo]

USA debt, Japan debt, Europe debt have been made with the people, children and even unborn as collateral.

They wanted the cake's money and eat it too.

[dinofelis]

USA debt, Japan debt, Europe debt have been made with the people, children and even unborn as collateral.

They wanted the cake's money and eat it too.

Indeed, the problem is not the money unit, but rather the deficit spending of states.

In fact, a state should not even need to borrow money.  If a state were to balance its fiscal income with its spending, there wouldn't be any problem.  The culprit is neo-Keynesian deficit spending.  Not money. 

If you spend today what will be confiscated tomorrow, based upon the bet that there will be more tomorrow than today, and that it will be more bearable to do confiscate stuff that may be there tomorrow, rather than today (which is the basic idea behind deficit spending), then even a 5-year-old sees that this will end in tears.

It is outrageous that states have been behaving like this.

[redsn0w]

So there isn't a real solution for the actual problem here in Europe, well done "democracy" !

[OROBTC]

...

The series of debt problems seems to be the greatest menace to the world's economy now.

There is plenty of blame to go around:

-- Banksters who hijacked huge sums of money, and have done so for years.
-- Governments all over the world spending more than they take in, yet "we" keep electing them.
-- Household and corporate debt have grown massively as well.

There seem to be no solutions that are acceptable to TPTB or even to the citizens.

This may end very poorly...

[redsn0w]

...

The series of debt problems seems to be the greatest menace to the world's economy now.

There is plenty of blame to go around:

-- Banksters who hijacked huge sums of money, and have done so for years.
-- Governments all over the world spending more than they take in, yet "we" keep electing them.
-- Household and corporate debt have grown massively as well.

There seem to be no solutions that are acceptable to TPTB or even to the citizens.

This may end very poorly...

Could bitcoin be a solution to these problems? What do you think about it ( I mean also as technology and not only a currency).

[steveturk]

the euro should have been kept a digital currency between banks like in 1999. greece will be out of the euro by year end and The Netherlands will probably issue a Gilder alongside Euro in the next 4-5 years.

No multi economic area have had a single currency succeed for more than 25 years - ever

[OROBTC]

...

redsn0w

I am not a programmer nor an expert in Bitcoin, so you're asking the wrong guy...    Just a happy user trying to learn more every day.

The technology DOES seem to be very promising however.  Especially if the core developers find a way to allow (hashed) data to "ride along" with BTC transactions without bloating the blockchain, there are various companies working on this idea (factom.org for example).

[Vyazhan]

the euro should have been kept a digital currency between banks like in 1999. greece will be out of the euro by year end and The Netherlands will probably issue a Gilder alongside Euro in the next 4-5 years.

No multi economic area have had a single currency succeed for more than 25 years - ever

The funny thing is that most of any fiat currency is in fact digital, yet centralized by all banks and central banks Most $/£/€ does in fact only exist on the exclusive bank blockchain Fractional Reserve banking at it's finest!

[steveturk]

agreed, what i meant was, it should have been kept as a "currency" that is pegged to local european currencies as opposed to replacing them. its incredible how they think one entity can control inflation / interest rates  "autonomous" economic areas with completely different economic profiles and requirements, but somehow "even" things out.

[picolo]

the euro should have been kept a digital currency between banks like in 1999. greece will be out of the euro by year end and The Netherlands will probably issue a Gilder alongside Euro in the next 4-5 years.

No multi economic area have had a single currency succeed for more than 25 years - ever

The Euro needs to have a political power in place or they need not to be so political about everything. Greece should not have entered in the EU and should not exit.

[steveturk]

they shouldn't have entered, but now they should stay?

[Vyazhan]

agreed, what i meant was, it should have been kept as a "currency" that is pegged to local european currencies as opposed to replacing them. its incredible how they think one entity can control inflation / interest rates  "autonomous" economic areas with completely different economic profiles and requirements, but somehow "even" things out.

Agreed. Removing a dozen currencies for one master currency can only end in a fiasco, just like uniting different nations under one agenda can only end in disaster and chaos, we decide which end of the chaos

[dinofelis]

the euro should have been kept a digital currency between banks like in 1999. greece will be out of the euro by year end and The Netherlands will probably issue a Gilder alongside Euro in the next 4-5 years.

No multi economic area have had a single currency succeed for more than 25 years - ever

This is not true.  The whole world has essentially been having a single currency (gold) for millennia.  
The problem is not the currency.  The problem is the deficit spending.  Using a local currency can "help" when you made a mess with your books by devaluating (inflating) it, and as such, screw your creditors, and lower your actual prices without saying so.
If you need a local currency, to be able to cheat on your creditors, and lower your prices, then it simply means that your balances are not in check.

States got used to be able to cheat their way out of their creditors by inflating their currency, and that is not possible anymore with a sound money or a multi-nation currency such as the Euro.

The Euro is not entirely sound money, but it is way closer to it than any of the former European currencies (except maybe the Deutch Mark).  If Europe would have switched to gold or silver, it would even have been worse for those second-hand car salesman states in the south that can only do business by cheating with the books.

Bitcoin would even be worse.  States aren't used any more to get their books in order, which is enforced upon them with sound money, and with the Euro to a certain extend.

[picolo]

the euro should have been kept a digital currency between banks like in 1999. greece will be out of the euro by year end and The Netherlands will probably issue a Gilder alongside Euro in the next 4-5 years.

No multi economic area have had a single currency succeed for more than 25 years - ever

This is not true.  The whole world has essentially been having a single currency (gold) for millennia.  
The problem is not the currency.  The problem is the deficit spending.  Using a local currency can "help" when you made a mess with your books by devaluating (inflating) it, and as such, screw your creditors, and lower your actual prices without saying so.
If you need a local currency, to be able to cheat on your creditors, and lower your prices, then it simply means that your balances are not in check.

States got used to be able to cheat their way out of their creditors by inflating their currency, and that is not possible anymore with a sound money or a multi-nation currency such as the Euro.

The Euro is not entirely sound money, but it is way closer to it than any of the former European currencies (except maybe the Deutch Mark).  If Europe would have switched to gold or silver, it would even have been worse for those second-hand car salesman states in the south that can only do business by cheating with the books.

Bitcoin would even be worse.  States aren't used any more to get their books in order, which is enforced upon them with sound money, and with the Euro to a certain extend.

The fiat currency helps them lie and have deficits.

[OROBTC]

...

dinofelis

Gold, more properly, has been used as a "Store of Value" for thousands of years.  It serves that role better than anything else!

The other two properties that most thinkers about money assign to "money" are a "Medium of Exchange" (easy to spend) and a "Unit of Account" (keeping track of what all your assets are worth).

Gold is now clumsy to use as "money".  Currency, fiat currency, will be with us for a long time.

*   *   *

picolo

10-4!  

+ 1!

Yes, fiat currency allows a multitude of sins that will not be easy to undo.  The huge debts everywhere are there because the banksters are taking advantage of huge deficit spending (by governments) that we voters allow them...

It's partly our fault too.  There is plenty of blame to go around.

Don't like that?  Buy gold!

[grendel25]

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!!

[Meuh6879]

global scenario = increase debt of all levels = financial RESET (FMi idea) = WAR comes (like in Argentine).



goto 1929.