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A press conference is underway following a meeting of Merkel, Hollande, Monti, and Rajoy: Direct...

A press conference is underway following a meeting of Merkel, Hollande, Monti, and Rajoy: Direct bailout funding of banks violates treaties, says Merkel. Sounds like a lot was accomplished.
Comments (30)
  • volosgirl
    , contributor
    Comments (20) | Send Message
     
    That's Queen Merkel for you. Ruler of all. What she's says goes. Are the big boys afraid of the bully!
    22 Jun 2012, 10:57 AM Reply Like
  • sr1977
    , contributor
    Comments (336) | Send Message
     
    Merkel says bring me the gold pill or I'll show you all how deep the rabbit hole goes.
    22 Jun 2012, 11:04 AM Reply Like
  • untrusting investor
    , contributor
    Comments (9951) | Send Message
     
    Anything but the more debt we have to guarantee pill.
    22 Jun 2012, 04:27 PM Reply Like
  • FWS
    , contributor
    Comments (136) | Send Message
     
    Why should the solvent countries be on the hook of the unsolvent ones if they do not want to fix their systems of too much government spending? I laugh when I hear that austerity isn't right at this time. Meanwhile the growth of spending over the past 5-7 years has increased an average of 14% for most European countries. When we will learn that it always comes back to the largess of social programs that kills the economies. THEY DO NOT WORK!
    22 Jun 2012, 11:30 AM Reply Like
  • klarsolo
    , contributor
    Comments (705) | Send Message
     
    How did the largess of social programs kill Spain again? I thought it was their banking sector that blew up. Isn't that capitalism?

     

    How did the largess of social programs kill Ireland again? I thought it was their banking sector that blew up. Isn't that capitalism too?

     

    I know some people equate all of Europe's issues with socialism. But every now and then capitalism actually doesn't work either. I know, it's hard to believe.
    22 Jun 2012, 12:23 PM Reply Like
  • Losing Paper While Gaining ...
    , contributor
    Comments (497) | Send Message
     
    Ireland wasn't killed by capitalism. There's nothing capitalistic about the *government* nationalising the banks to save them from the stupidity of reserve banking, following the bursting of a bubble created by low interest rates from the ECB putting the Irish people on the line for those banks' debts. Spain's not very different.
    22 Jun 2012, 12:53 PM Reply Like
  • klarsolo
    , contributor
    Comments (705) | Send Message
     
    I'm not going into that discussion. If you think letting all major banks in your country go bankrupt is a good thing in order to satisfy your ideology, I got nothing to say to you that could ever even make you contemplate that maybe capitalism isn't the answer to everything either.

     

    The U.S. had the exact same bubble burst. Our debt to GDP is even higher than Ireland or Spain, even without all that "social largess". The only reason we're not down there with them is because we can run our printing presses.
    22 Jun 2012, 01:05 PM Reply Like
  • American in Paris
    , contributor
    Comments (5504) | Send Message
     
    I don't disagree. But Europe is uncompetitive and the strength of Northern Europe is that they did liberalize the labor markets and cut social spending. Those are facts. Indisputable. Look the German 2002 reforms.

     

    In the case of Spain, the economy would recover much faster if the rules stipulating severance payments were scrapped. Completely. Today a Spanish worker on a permanent labor contracts get 33 weeks of severance pay for every work.
    22 Jun 2012, 01:48 PM Reply Like
  • chrstne7
    , contributor
    Comments (57) | Send Message
     
    it was killed by crony capitlism.
    22 Jun 2012, 02:02 PM Reply Like
  • six-oh
    , contributor
    Comments (590) | Send Message
     
    FYI - Spain's external debt to GDP ratio is ~ 230% and growing.

     

    Ireland's external debt to GDP ratio is ~ 1250% and growing.

     

    America's external debt to GDP ratio is ~ 100% and possibly stabilizing.
    22 Jun 2012, 02:10 PM Reply Like
  • Losing Paper While Gaining ...
    , contributor
    Comments (497) | Send Message
     
    My ideology? *My* ideology? You blame "capitalism" for a problem caused by central banks and you think *my* ideology is the problem?

     

    On average Ireland's housing prices went up 247% in 10 years, the US's went up 47%. You think you know a bubble? Watch 42% of your country's GDP (the construction industry) practically disappear in next to no time and see how a real bubble works. This resulted in the politicians, not the capitalists, nationalising the debt and the Irish people are now on the hook. Before the nationalisation Ireland's debt to GDP was less than 25%, it's now well over 4x GDP. The bank's shareholders should have been burnt, that's capitalism.

     

    Don't for a second blame capitalism for this. This is not about my ideology, it's about you misleading people.
    22 Jun 2012, 02:17 PM Reply Like
  • klarsolo
    , contributor
    Comments (705) | Send Message
     
    Germany even calls its system "social capitalism". One of the two biggest parties are the so called "Social democrats" (and it happened to be that party which cut welfare in 2002). Now look how that "evil" socialism is working out for them: 6 weeks of vacation, much lower costs for healthcare and education, and yet their economy is one of the best in the world. Some people's heads must explode when thinking about this.

     

    People often point to Germany and say "Ah, but the taxes, the TAXES". And yes, taxes are probably easily 10-15 % higher on average in Germany. But now start factoring in your healthcare costs over a lifetime in the U.S., plus potential costs for your kids college, and treat that as a tax... how different are the tax rates now?!

     

    No, I am not advertising socialism here. I'm advocating actual thinking. Many people stop thinking when certain buzz words come up.
    22 Jun 2012, 02:20 PM Reply Like
  • Losing Paper While Gaining ...
    , contributor
    Comments (497) | Send Message
     
    So what? What has this got to do with Ireland and Spain?
    22 Jun 2012, 02:24 PM Reply Like
  • klarsolo
    , contributor
    Comments (705) | Send Message
     
    Nothing. Just wanted to comment on how people these days use any kind of news for political rants in lieu of actual thinking.
    22 Jun 2012, 02:26 PM Reply Like
  • Losing Paper While Gaining ...
    , contributor
    Comments (497) | Send Message
     
    Ok, how about you think about what constitutes real capitalism vs other things?

     

    Bailouts are not capitalistic.
    Central banks are not capitalistic.

     

    It was you who made the political rant, I'm just pointing out that you're not being accurate in directing blame.
    22 Jun 2012, 02:35 PM Reply Like
  • klarsolo
    , contributor
    Comments (705) | Send Message
     
    It is of no interest to me what constitutes "capitalism", as understood by most people. Or "socialism" for that matter. I'm interested in any system that is able to provide the most opportunity along all kinds of dimensions / variables to the largest number of people while minimizing the tail risk for individuals / society and the environment as a whole. Capitalism is certainly better than many other systems in this regard, but by no means it's perfect. The idea to not touch or tinker with it just because then it's no longer "pure" is absurd to me. Just because it may be the best system we've had so far doesn't make it the best system there is.

     

    What we've had during the Industrial Revolution is probably coming closest to the idea of "pure" capitalism. Is that what people want? Me thinks not.

     

    I'm not interested in blaming other people, I'm interested in promoting thinking for yourself and looking at the data at hand.
    22 Jun 2012, 02:48 PM Reply Like
  • Losing Paper While Gaining ...
    , contributor
    Comments (497) | Send Message
     
    Then how about you leave attacking "capitalism", and in your comment that's *exactly* what you were trying to do, to people who know and care what the term actually means rather than asking loaded and misleading questions?
    22 Jun 2012, 02:53 PM Reply Like
  • klarsolo
    , contributor
    Comments (705) | Send Message
     
    I think you are not really comprehending my comments or you'd not be reading things into it that I'm not saying. I just said that capitalism as commonly understood is probably the best system we've had so far, but that it is still flawed. If that constitutes "attacking" to you then obviously you treat this matter like a rabid sports fan. In that case I bid you a good day, Sir. There is no point in arguing with a fundamentalist zealot.
    22 Jun 2012, 03:00 PM Reply Like
  • Losing Paper While Gaining ...
    , contributor
    Comments (497) | Send Message
     
    This is not about being a "rabid sports fan". That implies blind support for something despite all failings which is not the case here.

     

    You're outright misleading people by blaming "capitalism" when the causes and proposed solutions by all parties are in no way related to capitalism, and I'm pointing it out to you.

     

    Instead of accepting that you're pulling a "la la la... I'm not listening!".

     

    So be it.
    22 Jun 2012, 03:07 PM Reply Like
  • klarsolo
    , contributor
    Comments (705) | Send Message
     
    I accept that I can be wrong with anything I'm saying. I'm not above that at all. Neither is anyone else. This is not math homework where you can easily show somebody your point and proudly exclaim "Q.E.D.". If it was then society as a whole would not be wrestling with these questions, with every country implementing their own slightly (and sometimes not so slightly) different rules, and then constantly changing and adjusting things as they encounter difficulties along the way.
    22 Jun 2012, 03:09 PM Reply Like
  • klarsolo
    , contributor
    Comments (705) | Send Message
     
    How exactly did Irish politicians cause the housing bubble? Did they force banks to make loans to high risk borrowers? Or did the banks do that themselves because they smelled fresh dollars?

     

    The politicians are to blame for assuming the costs of that bubble and socializing that cost. But I really don't think you can say with a straight face that capitalism had absolutely nothing to do with that bubble, or I think you really discredit yourself.
    22 Jun 2012, 04:37 PM Reply Like
  • Losing Paper While Gaining ...
    , contributor
    Comments (497) | Send Message
     
    I like how you claim to be done with this discussion, refuse to admit your own misleading comments, and then jump half way back up the discussion to try and branch it off by claiming I said Irish politicians were to blame when I said nothing of the sort.

     

    (That's not to say they weren't a help, but I never actually said that)
    22 Jun 2012, 04:55 PM Reply Like
  • klarsolo
    , contributor
    Comments (705) | Send Message
     
    You are right, you did not. I apologize, I misread your post. You said central banks were to blame. Sure they share in the blame, no objection from me. I still wouldn't attribute most of the blame to them though; there are plenty of parties responsible for this mess. My number one party, particularly responsible for the mess here at home, still are the ratings agencies. Had they not rated junk as AAA we'd not be in such a pickle.

     

    The reason I jumped back is because I just now noticed your comment when browsing through the discussion thread again. I'm sometimes a little ADD in my workflow, for some reason I did not see it before.

     

    I have no problem admitting when I'm wrong. Please point out to me what I said that was misleading and then I'll re-evaluate. Btw, I appreciate your civility in this discussion. I get the sense that something I have said is really frustrating you (even though I'm honestly not quite sure what that is, because our viewpoints don't seem that far apart), yet you stay polite.
    22 Jun 2012, 05:00 PM Reply Like
  • 544
    , contributor
    Comments (29) | Send Message
     
    The writing is on the wall, Greece first follow by Spain and Italy will go
    bankrupt and the sooner the better with new and slow recovery. I hope
    Obama will learn that socialism is not working but I doubt he will.
    22 Jun 2012, 12:07 PM Reply Like
  • American in Paris
    , contributor
    Comments (5504) | Send Message
     
    I don't think you know much about European social democracy. Northern Europe is by your standards quite socialistic, but it works reasonably well. Germany has universal health care financed through tax and a state pension and state financed universities.

     

    Some social democracies are crippled. Others are thriving.
    22 Jun 2012, 01:49 PM Reply Like
  • chrstne7
    , contributor
    Comments (57) | Send Message
     
    sadley your misinformed.
    22 Jun 2012, 02:04 PM Reply Like
  • six-oh
    , contributor
    Comments (590) | Send Message
     
    FYI - Germany's external debt to GDP ratio: 205%, and growing.
    22 Jun 2012, 02:07 PM Reply Like
  • wapiti
    , contributor
    Comments (711) | Send Message
     
    Yep FWS - you are spot on! Why should germany suffer to pay for the rest of Europe's sins? If I were a German, I would want to exit the Euro
    22 Jun 2012, 02:31 PM Reply Like
  • BannerGlobal
    , contributor
    Comments (8) | Send Message
     
    Austrian Econ model (Germany, Austria, Finland) vs neoclassical bailout Econ model in the rest of Europe and US. Most likely outcome remains Germany leaves euro zone first by year-end.
    22 Jun 2012, 02:32 PM Reply Like
  • six-oh
    , contributor
    Comments (590) | Send Message
     
    OK, I will add my prediction vis a vis the Euro zone.... No one leaves, and the ECB will pursue a policy of accomodation that will band-aid over the obvious weaknesses in about half the euro zone countries.

     

    I used to think that Greece, or Italy would exit first. After looking at the paper trail of borrowed money, guess what? The Euro zone is too big to fail! I know you're laughing now, but it's true. At some point of course there will be a mind-blowing collapse in the world economies that will probably start in Europe or in China, but will take down all countries with it.

     

    I don't think that this will happen for another few years though, as everyone seems to think that Greece, Spain, Italy, Ireland, etc... still have hope. Keep the haircuts, and the bottomless credit lines coming!!! The euro zone is too big to fail... yet.
    22 Jun 2012, 02:48 PM Reply Like
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