Greece is facing a humane crisis

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Retired in Crete

Greece is facing a humane crisis

Postby Retired in Crete » Thu Feb 21, 2013 3:37 pm

I rarely agree with anything in The Guardian but this does describe conditions in Athens pretty accurately.

http://www.guardian.co.uk/commentisfree ... -crisis-eu

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Postby Stuart & Jo » Thu Feb 21, 2013 3:53 pm

WOW :!:

Makes me think we should delay our plans to move to Crete for a couple of years... :cry:

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Postby Fab » Thu Feb 21, 2013 6:37 pm

OK...does this mean that the Euro is the problem? Would Greece get better if they get out of the Euro and back to a currency which is not strong but at the same time makes the country a place in which external investors would spend/invest more because it would be cheap?
For instance, if Greece goes back to the Dracma Greek people will not have much money to spend outside their country (and they do not have it anyway), but many would come to Greece to open industries...and turism would gain a lot.
OK, someone could say that the cost of natural resources (Oil, Gas) would be too high if the country pays with a Dracma...but....how was it before? Would have Greece collapsed if they were not joining the Euro 12 years ago?
Fab

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Postby Jeffstclair » Thu Feb 21, 2013 7:42 pm

Stuart & joe wrote WOW Exclamation

Makes me think we should delay our plans to move to Crete for a couple of years... Crying or Very sad

To be honest I think it is gonna get worse for the Greek people in the next two years , and many years before things pick up ...jeff..

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Postby Kilkis » Thu Feb 21, 2013 8:46 pm

I don't think "being cheap" is a sufficient condition to encourage investment, Fab. Investors invest with the aim of getting a return on their investment. If Greece went back to the Drachma and that devalued, as it inevitably would, then a foreign investment would need to grow in Drachmas as fast as the Drachma devalues just to stand still in the original currency of the investor. It would have to grow even faster for the investor to get a return. What opportunities do you envisage in Greece that could generate that sort of growth?

Cheapness might attract more tourism but that is not guaranteed. Greece relies a lot on imported goods. If the Drachma devalued all those goods would increase in price. This would put pressure on inflation and hence on the price local businesses could offer to tourists.

In general investors look for stability. They don't like uncertainty and Greece with the Drachma would be a very uncertain place. That is why so much money left the country when there was a suggestion that Greece might exit the Euro.

I don't necessarily think the Euro is a good thing but Greece is in a huge mess because previous governments have put it in a mess. A change of currency won't alter that mess.

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Postby filippos » Thu Feb 21, 2013 8:47 pm

Jeffstclair wrote:To be honest I think it is gonna get worse for the Greek people in the next two years , and many years before things pick up ...jeff..
I agree with that and I suspect a few British who rely on pensions will feel the pinch, too, the way the pound has been heading against the Euro and Dollar. Many 'experts' are predicting that situation will become much worse in the near to mid term.

I think the Greek people will suffer more than we will, but at least many immigrants will have the option to return whence they came.

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Postby Jeffstclair » Thu Feb 21, 2013 8:55 pm

filippos wrote:
I think the Greek people will suffer more than we will, but at least many immigrants will have the option to return whence they came.

Not in my case , the distant crackling sound you hear is the sound of burning bridges...jeff....

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Postby Kilkis » Thu Feb 21, 2013 9:07 pm

filippos wrote:...I suspect a few British who rely on pensions will feel the pinch, too, the way the pound has been heading against the Euro and Dollar. Many 'experts' are predicting that situation will become much worse in the near to mid term...


I tend to agree with the experts with a slight proviso. When the pound first started going down from €1.50 several years ago I argued on another forum that it would stick around parity for a time and would then go down below parity, possibly as far as €1 = £1.50. Most people thought that was impossible. So far it hasn't done what I predicted because crisis in the Euro-zone tended to outweigh how bad things really are in the UK. It went down to near enough parity but then recovered a bit. If the Euro-zone manages to stabilise then I see no reason to change my prediction. The UK has the biggest total debt to GDP ratio in the world, at least amongst major economies and that debt is still growing.

The proviso? I don't think that the Euro-zone is out of the woods yet. If a major economy like Spain or Italy starts to unravel then the Euro might start to fall back against major currencies.

filippos wrote:...I think the Greek people will suffer more than we will, but at least many immigrants will have the option to return whence they came.


I agree totally with that although I hope I'm not one of those forced to exit. It would need to get pretty bad for me to do that.

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Postby filippos » Thu Feb 21, 2013 9:11 pm

Kilkis wrote:..... and Greece with the Drachma would be a very uncertain place.
It's a pretty uncertain place with the Euro, too.
If the Drachma devalued all those goods would increase in price. This would put pressure on inflation and hence on the price local businesses could offer to tourists.
As the drachma sinks wouldn't visitors get more of them to the £/€/¥/ƒ to compensate?
.... Greece is in a huge mess because previous governments have put it in a mess.
Can't argue with that but I don't think the Euro has helped.

EU funds thrown into Greece may have improved infrastructure but at the same time, unfortunately, raised the expectations of many Greek people to unsustainable levels. Euro membership also enhanced the opportunities for the corrupt members of the aforesaid governments to their piles of personal assets even higher (although that would have happened whatever the source of funds).

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Postby filippos » Thu Feb 21, 2013 9:21 pm

Kilkis wrote:I tend to agree with the experts with a slight proviso. ................ If the Euro-zone manages to stabilise then I see no reason to change my prediction. ............... I don't think that the Euro-zone is out of the woods yet. If a major economy like Spain or Italy starts to unravel then the Euro might start to fall back against major currencies.
I don't disagree with that.
Kilkis wrote:
filippos wrote:...I think the Greek people will suffer more than we will, but at least many immigrants will have the option to return whence they came.
I agree totally with that although I hope I'm not one of those forced to exit. It would need to get pretty bad for me to do that.
Likewise.

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Postby ScotinCrete » Thu Feb 21, 2013 11:32 pm

IF many of us went back it would be to the UK. The country with the most debt, lowest productivity and rising energy prices to go with a semi arctic climate!
Just back from the UK and keep getting the feeling its too much glitzy wall paper to try and cover up the fact that the underlying structure is crumbling.
After 2 years here we did review our options and decided objectively there wasn't a risk free country left so better to be in a place we loved.

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Postby filippos » Fri Feb 22, 2013 12:09 am

The only way I can imagine leaving Crete is by deportation.

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Postby John Oddy » Fri Feb 22, 2013 2:12 am

We are not yet in Crete so I cannot speak on how it is in Greece but I can say how bad it is in the UK (and getting worse by the minute). Infrastructure in the UK is at breaking point and has been for years, schools, the NHS and social housing are all buckling under the pressure. I, like many others, believe our membership of the EU is a major contributor to our situation, along with the mismanagement of a Labour Government.
We can argue my comments all day long but that is not the point, the point is, no matter where you are in the world, things are bad and they are going to get worse before they get better. We have, at least, 5-7 years before we will see an up-turn. If Greece did return to the Drachma, and I believe they should, then yes it would be vastly devalued but Greece is heavily dependent on tourism and with a devalued Drachma and cheap holidays then tourists would flock to Greece, bringing with them the Pound and the Euro and increased spending and, therefore, an increase in labour requirement and everything else associated with tourism from car hire to laundry. A country cannot beg its way out of recession it has to work its way out, at the moment Greece is treading water, at best, there needs to be a fundamental change of tactics and attitude.
Greece has clung onto the EU shirttails and it hasn’t worked what they need to do now is throw in the towel and start afresh, they are a proud nation who has been poorly and corruptly led by a succession of Governments, they can and they must put their house in order before it is too late.

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The Dracma (or, out of the Euro currency) matter

Postby Fab » Fri Feb 22, 2013 4:31 am

Indeed I would say that with a non-strong currency Greece could become the new "producer" of some general goods. It used to be China (actually still is), but China is slowing down because they are getting better and better. Therefore, if it is a cycle, Greece could use this opportunity to become the next in line, though not as productive as China, obviously, due to the difference in size....but still, I think that is the only way....conceptually...
Fab
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Postby fuzer » Fri Feb 22, 2013 8:41 am

It matters not if Greece uses the Euro or Monopoly money - if the Police - Judicial system - Administrative systems fail to operate towards the positive good then there is no point in investing or setting up a business in Greece.

When your biggest industry/money maker is Tourism but the media constantly shows Golden Dawn beating up foreigners while the police stand by doing nothing - you have more serious problems than the colour of your money.
ALWAYS FINISH WHAT YOU STAR


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