The Greek Economy

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Re: The Greek Economy

Post by Chris » Wed Apr 07, 2010 11:44 am


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Re: The Greek Economy

Post by Chris » Thu Apr 29, 2010 3:31 pm



I and no doubt many of you will be interested in opinions from forum members on what they think will happen with the Greek economic situation. What do you think should realistically. Should Greece go ahead with a bail out, or as many have said, return to the Drachma. Personally, I think the bail out will go ahead, otherwise the Euro(€) Zone, and the EU will lose all credibility. I further believe that the return to the Drachma would cost a fortune and the logistical problems would be beyond reproach. On the other side of things, I am not sure Greece will get bailed out of the Euro zone - the Germans for instance are still asking for certain guarantees what will happen to the money and debt, and of course there is the matter of legal action. In time to come Greece will be forced to drop out of the Euro Zone, to save itself from a long period of suffering as a result of the bail out, and it will ultimately leave the Euro behind. Of course this could be some time ahead, rather than immediately.

What are your views and thoughts on this situation. How will effect the rest of Europe. Portugal and Spain have been downgraded on their debts. Ho many more will it effect. Does it effect the UK. Of course whilst this is going on, the Exchange Rate will remain low.

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Re: The Greek Economy

Post by Al » Thu Apr 29, 2010 7:01 pm

Hi

I personally would like to see Greece return to the Drachma, not just because we used to get more for our cash, but the whole
outlook for Greece was a lot more secure, the Idea of one nation heading up the rest of Europe with one currency could only mean one
thing a dictatorship !! the euro has NOT worked and the sooner the countries using this return their native currency then and only then will there
countries economy start to grow !!!

Keep the Euro :ddown: :ddown: :ddown: :ddown: :ddown: :ddown: :ddown:

Greece to return to the Drachma :dup: :good2: :dup:

Regards

Al :cool:

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Re: The Greek Economy

Post by Chris » Thu Apr 29, 2010 11:11 pm



Article from today's Daily Telegraph - Greece: why did its economy fall so hard?
With Greece's economy in desperate trouble, Harry Wallop (Consumer Affairs Editor of the DT) gives his explanation how Greece got into such a mess.

Greece has long lived beyond its means and spent much of the last two centuries defaulting on its debts. Joining the euro was meant to put an end to all that. However, it merely seems to have exacerbated its problems. It was no surprise to any economist that the European Union, at first, refused to allow the country to join the euro when the new currency started in 1999. Quite simply, its debts were too high and inflation was out of control. By 2000, the EU finally allowed it to join, though there were suspicions at the time that Greece was operating a "limbo dance" – squeezing its figures to hit the stringent euro criteria, only for them to flip back to dangerous levels once it had entered. Indeed many believe Greece simply lied about its figures to gain entry. At the time its inflation was 4 per cent, much higher than the European average, and was suffering from one in ten people out of work – a higher figure than currently in recession-hit Britain.

By joining the euro, however, it suddenly enjoyed substantially lower interest rates, because the it was able to borrow in euros. Whereas during the 1990s, Greece had frequently had to pay out 10 per cent or more (18 per cent in 1994) to borrow money, its rate fell dramatically to 3 per cent or 2 per cent. Ben May, Greek economist at think tank Capital Economics, said: "Their mistake was to go out, borrow money and use it to fund huge wage growth, rather than pay down its already substantial debts." Greece went on a spending spree, allowing public sector workers' wages to nearly double over the last decade, while it continued to fund one of the most generous pension systems in the world. Workers when they come to retire usually receive a pension equating to 92 per cent of their pre-retirement salary. As Greece has one of the fastest ageing populations in Europe, the bill to fund these pensions kept on mounting. Tax evasion, endemic among Greece's wealthy middle classes, meant that the Government's tax revenues were not coming in fast enough to fund its outgoings.

Hosting the Olympics in 2004, which cost double the original estimate of €4.5 billion, only made matters worse.

By the start of this year Greece's debt had hit €300 billion, more than the entire value of its annual GDP. This is unlikely to fall quickly, as its current budget deficit – how much its borrowing exceeds tax receipts – is running at 13.6 per cent of its gross domestic product, twice the Eurozone average.
Things have come to a head because the international rating agencies have cut Greece's credit rating, concerned that it will default on its debts. This has the immediate effect – just as when a credit agency cuts a consumer's rating – of pushing up the cost of its borrowing, setting off a vicious spiral.

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Re: The Greek Economy

Post by Chris » Fri Apr 30, 2010 3:56 pm




If you want to know who really plunged Europe, including Greece, into economic "uncertainty" (how gentle a word), take a look at the behaviour of the big banks. Specifically, Goldman Sachs, Morgan Stanley, Citigroup, Bank of America, Wells Fargo and last but not least, our very own JP Morgan Chase. Current revelations in the US detail very clearly their - continuing - role in the financial meltdown. You can find this on Google, or you can read about at BILL MOYER'S JOURNAL: FINANCIAL REGULATORY CAPTURE

Further to the above, many are saying today that there is no way on earth that Greece could go back to the Drachma. Most of the money owed is owed to these banks, and those in Germany, France etc. It would be suicide for the Eurozone and the EU to allow this to happen.

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Re: The Greek Economy

Post by Chris » Sun May 02, 2010 12:42 pm




Of course I am not fully convinced that the above comments by Mr. Moyers is the right approach on this problem in Greece. Greece, or at least the Prime Minister has decided to accept a bail out from the EU and IMF. Is this going to help. Is this more debt to pay out more debts. Of course we know the real problem is the taxation problems of the whole of Greece. We know that Greece have the Olympic Gold Medal on this matter, whether it is the lowly manual worker, upto the big earners, if they can get away without paying tax or the correct tax, they will. This is part and parcel of what has caused the problems in Greece throughout. It appears from the recent marches and riots in Athens and other parts of Greece that the general consensus is, we want to get out of this rut, but you are not going to change the way we pay our taxes. However, this is not the way it is, is it. Everyone, and it means everyone has got to tighten in the monetory reigns, tighten their belts, and pay up on their taxes. Yes this means that many will suffer, but more will suffer if this is not sorted now. There is no other way, IS THERE. Greece cannot go back to the Drachma, their debts are to others who have used the Euro wisely, and to their advantage. How else would they have made the loans to Greece on the understanding they would pay them back. No one wants to see Greece in this predicament, no one wants to see the people of Greece suffer, but it has to be said that it is down to equal problems that Greece is in the situation it is in, therefore they all need to band together to get it sorted.

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Re: The Greek Economy

Post by Chris » Mon May 03, 2010 4:34 pm




The following news story is taken from the Greek online newspaer, Kathimerini, today, Monday 3rd May.

DEAL AGREED, TOUGH STEPS ANNOUNCED

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Re: The Greek Economy

Post by Chris » Wed May 05, 2010 11:43 am



Further strikes are being marched today in protest at the Greek Governments proposals of paying back the £90Bn loan they have agreed on from the EU and the IMF. This has caused more uprage within Greece, and it is planned to retrieve this money back by stopping increases in Pension Plans, Wages, with increases in Taxations, and VAT. The latter will obviously hit our pockets when on holiday. The Greek Government is hitting hard, and not allowing anyone (hopefully I feel) to get away with the way they acted before with taxes etc.

The strike today includes Air Traffic Controllers which has resulted in flights to and from Greece being cancelled. The holidaymakers get hit again.

It is obvious that something needs to be done on the part of Greece this time, and to maintain that restraint on the financial situation. It is already having knock on effects in Spain and Portugal with similar problems, and although we are not in the Eurozone, it will also effect the UK as most of our dealings are with Europe and dealt with in the Euro.

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Re: The Greek Economy

Post by Chris » Thu May 06, 2010 12:08 pm



I think what we must first understand and realise is the fact that yesterdays strike marches was not a full picture of the majorities way of thinking. 84% of the Greek population (according to a Greek media source) are for the governments way of sorting out the problem by borrowing, raising taxes, raising VAT, at the same time, clamping on Pension and Wage rises.

Those causing the big problems yesterday, are the same type of people that every country has, including our own. A communist faction who is hell bent on disrupting any lawful protest, march or strike.

It is estimated in total that 100,000 people attended the march yestereday in Athens. This is not a huge representation of Greece is it.

The holiday industry is suffering, across the board for many reasons. The present Greek crisis has not hit in on this as yet, but no doubt it will do in time to come. For instance, as the figures are set for this year, will the proposed VAT rises come into force now, or will we see more of it in the 2011 season.

It is common knowledge that the way things are in Greece is down to everyone in some way or another, small or large. Therefore it is only right that everyone should be involved in getting Greece back to some sort of stabilisation.

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Re: The Greek Economy

Post by lilleli » Sun May 16, 2010 9:50 pm

After looking through the different inputs... and also following the situation from the Danish papers and news... just a few points of view:

1. I think that if Greece had not joined the Euro their troubles would have been much worse. After All the Euro has been a stabilizing factor... and it is far too easy to say that the Greek can blame it all on the EU. Denmark is not part of the Euro - but our currency is linked to it and if we hadn't been the financial crises would have put Denmark in a deep crises. The problem is that The different Governments in Greece has not been addressing the issues at hand...
2. ALL people in Greece should pay their taxes... no more paying "for air" or paying without invoice... to the contractor or architect etc. If all taxes were paid without any exceptions I do believe that the State would have sufficient funds to mend the roads and a decent health system...No deduction for the wealthy or people living abroad but having big Villas and big boats in Athens... Greece is the most corrupt country within the EU...so I do believe everyone has to embrace a whole new way of thinking. Be ready to take on any jobs... and not just leave the shitty jobs to Albanians or other foreigners...
3. NO more reform upon reform... Greece needs a new government - and not another Papandreous or similar...a government who will dare to make the changes. Get rid of corruption in all areas of the society . Cut wages for politicians and look into the wages - also for the Eu politicians.
3. The tourist have paid enough and Greece cannot survive without them.

It all boils down to a unhealthy way of thinking that has spread in society from the top down to the bottom... and I do believe it is very sad as it will probably be the next generation that will have to pay the bill...


p.s. sorry for any spelling mistakes....

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Re: The Greek Economy

Post by Chris » Sat May 21, 2011 3:04 pm

The following news item was taking from the English Edition of the Greek Newspaper, Kathimerini, today. Who will this effect on Corfu, if anyone. Maybe some businesses may suffer with the increased taxes.

New austerity measures coming

Finance Ministry’s latest plans to boost revenues include increasing levies for property owners

Increased taxes on property owners with assets worth more than 400,000 euros, a reduction in allowances paid to public servants and a levy on soft drinks are among the options the Finance Ministry is looking into as a means of saving 26 billion euros until 2015. With representatives from the European Commission, European Central Bank and International Monetary Fund having left Athens for a short period, the ministry is looking for ways to find 6 billion euros’ worth of savings or revenues for the year in a bid to convince investors that Greece is on track to reducing its deficit by 2015.
According to sources, the government is looking at lowering the tax-free threshold for property owners. Currently, only those with assets worth more 400,000 euros are hit with a property levy, however, the ministry is looking into dropping this cut-off mark to 300,000 euros. If implemented, the measure will apply from 2010, which means that property owners will have to pay backdated taxes as of January last year. The government is also considering increasing a tax paid on large property portfolios, which means assets worth more 400,000 euros, a source added. Government data show that about 150,000 taxpayers in the country own assets worth more than 400,000 euros.

Other options the ruling Socialists are looking into in an effort to bump up revenues is through the introduction of levies on natural gas and soft drinks, as of the start of next year. With the country in its third year of recession and consumption and investment activity falling, Greece is struggling to bring in revenues, which fell short of annual targets early in the year. Government figures for the first four months of 2011 show that net ordinary budget revenue totaled 14.46 billion euros, down 9.2 percent year-on-year, compared with a January-April target of 16.34 billion euros.
Other planned revenue-raisers the government is eyeing is upping several goods from the lower 13 percent value-added tax group to the higher 23 percent group. The reduction of tax breaks for first-home buyers is also being examined, the source added.

The ministry is expected to unveil its medium-term 2011-15 strategy aimed at helping restore the country’s fiscal health in the next few days.

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Re: The Greek Economy

Post by Chris » Thu May 26, 2011 10:21 am

Something of Interest I found on the Kathimerini News today


DRACHMA IS NO SOLUTION

Greece stands at a crucial crossroad: It can either put its affairs in order or go bankrupt and return to the drachma. A powerful alliance in favor of the latter has risen. It comprises old-style unions, state-supported businessmen with no desire for rationalization, bankrupt business owners who see this as a means of hiding their failures, anti-European powers of the left and the populist right, some media and, finally, hardcore PASOK politicians who are after maintaining power at all costs.

Standing opposite this alliance is a government with a leadership deficit and a panicked political body. Is the country going to be destroyed to satisfy the interests of PPC’s worker union and goldbugs waiting for it to fold? Will someone explain to the people that the drachma will lead to poverty and not to redemption for the average Greek? We cannot allow a combination of powerful interests and ineffectual leadership to lead us to a national disaster.

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Re: The Greek Economy

Post by Chris » Thu Jun 23, 2011 11:33 am



Something I have read with interest, that maybe of interest to others.

GREEKS BEARING BONDS


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Re: The Greek Economy

Post by Chris » Fri Jun 24, 2011 12:14 pm


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Re: The Greek Economy

Post by Chris » Wed Jul 13, 2011 3:51 pm

You might be interested in reading this, or not. Is the right thing to do. You may remember last year at the start of all the Greece problems, that the Germans indicated that Greece should sell up islands, The Acropolis, etc, to help in repaying their debt.

MON REPOS - PRINCE PHILIPS BIRTHPLACE CENTRE OF GREEK HERITAGE ROW

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Re: The Greek Economy

Post by DaveD » Wed Jul 13, 2011 8:13 pm

Greece needs to pull up its socks and its not going to be pleasant. They wanted IN to the Eu and that means collecting taxes from their populance. How many times have you walked past an apartment block with the re-bar sticking out of the roof? By not finishing there homes they do not pay tax. The men retire at 50-55 and expect a pension. Doctors claim they are paid LESS than £12k per year so they dont pay taxes. Well thats up to the people but they must get a grip or they will loose their only means of income. If we dont get a good deal with our host in Roda this year its good by Greece theres plenty more places to holiday. I for one am glad UK arnt in the bail out, we have enough visitors to bail out as it is. Some peps may not like what I have posted but its showdown time for Greece now. They either shape up or they ship out. Sorry.

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Re: The Greek Economy

Post by Chris » Thu Jul 14, 2011 12:35 pm



As much as I love Greece, and in particular Corfu and Zakynthos, I am inclined to agree with you Dave. Elaine and I, mainly due to ill health and being unable to travel by air, have visited France, and are other love Cornwall. We would much love to go back to Corfu, and at one point was planning a drive down to Italy and take the ferry. We would then have the use of the car on Corfu. However, recent matters arising, we are inclined to think again, or to be truthful be very careful in how we move. The pressure must be on the population of Greece and in particular Corfu to pull up their socks as you say. Already we know that in September the VAT rises to 23% on food and drink, that is another 10% people will have to find if fending for themselves. In turn, this cost would also be added to HB and AI. All in all increasing the cost of a holiday.

In my opinion, if people love their country enough, they, you would think would do something to help to save if from the ever increasing mess they are in. I think it is high time the Euro Auditors stepped in to check on real earnings and takings.


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Re: The Greek Economy

Post by DaveD » Thu Jul 14, 2011 7:26 pm

Yes Chris, I am inclined to agree with you. Greece is our first choice for a holiday. Besides Greek islands we have only been to Cyprus. This was our first Med holiday (2000) and we were delighted with our choice. Flying from Hurn to Larnaca, when that door opened and we felt the heat for the first time, marvelous. The food, sumptuous, the people were very welcoming. We just hope it all works out for them. :suun:

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Re: The Greek Economy

Post by Chris » Fri Jul 22, 2011 12:15 pm




Another bail out of £96.3bn to help in the recovery of Greece and its financial problems. Already the share prices have been rising this morning in response to this help. However, regardless of the economy, and the pending VAT rises in September, Greece still remains the better options for holidays, with prices not rising as much as other Eurozone countries. How will the 10% rise in VAT effect the tourist economy. On the other hand, do the strikes currently happening in Corfu, ie, those with the Taxi Drivers Union SATA, bringing the country to a near halt, including on Corfu which suffered badly yesterday. To add to this, it has been seen that a number of Car Hire Companies have been raising their prices during this period. In my opinion this does not give confidence to the tourist. It will be worth watching the prices, and to see how the Greek government is going to implement the tax rises, both VAT and personal. A third bailout is a NO NO.



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Re: The Greek Economy

Post by Chris » Wed Nov 23, 2011 4:55 pm

The following dropped into my inbox by email today. I thought I would share it with you all.

Greek bail out
It is a slow day in a little Greek Village. The rain is beating down and the streets are deserted.
Times are tough, everybody is in debt, and everybody lives on credit. On this particular day a rich German tourist is driving through the village, stops at the local hotel and lays a 100 euro note on the desk, telling the hotel owner he wants to inspect the rooms upstairs in order to pick one to spend the night. The owner gives him some keys and, as soon as the visitor has walked upstairs, the hotelier grabs the 100 note and runs next door to pay his debt to the butcher. The butcher takes the 100 note and runs down the street to repay his debt to the pig farmer. The pig farmer takes the 100 note and heads off to pay his bill at the supplier of feed and fuel. The guy at the Farmers' Co-op takes the 100 note and runs to pay his drinks bill at the taverna. The publican slips the money along to the local prostitute drinking at the bar; she has also been facing hard times and has had to offer him "services" on credit. The hooker then rushes to the hotel and pays off her room bill to the hotel owner with the 100 note. The hotel proprietor then places the 100 note back on the counter so the rich German tourist will not suspect anything. At that moment the German tourist comes down the stairs, picks up the 100 note, states that the rooms are not satisfactory, pockets the money, and leaves town.
No one produced anything.
No one earned anything.
However, the whole village is now out of debt and looking to the future with a lot more optimism.
And that, Ladies and Gentlemen, is how the bailout package works

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