The Great Debt Bubbles

Seven Reasons why Greece will default, sooner or later

1. Greece is in an impossible situation, because once you lose your cash-flow and you can’t invest in the future any more, you can’t pay your debts, whether you are an individual, a corporation or a country. The country, in terms of export volume, is ranked 65th in the world and thus is far below the EU rankings. Greece mainly exports the following commodities, Food and beverages, Manufactured goods, Petroleum products, Chemicals and Textiles principally to other EU countries and the U.S., but because of high labour costs, right-brained inefficiency and M.G.S (Money Greed Syndrome) – i.e. financial nepotism and corruption, they can never expect to compete. And unfortunately everything they export can be made cheaper elsewhere.

2. The Euro can be seen as a F1 race, where Germany and other Northern countries with the most modern cars that exist, allowed Greece which only has a F1 racing car, which was made in the 1970’s to take part in the Euro race. And because the Greek car keeps breaking down, the rest of the F1 teams are demanding that they convert their car to a 2011 model forthwith (without any further investment), otherwise their wheels will be repossessed. Which anybody knows is not going to make the car go any faster. And apart from the sun, Greece does not have vast resources like other countries and is also notoriously bureaucratic, where 40% of people work for the Government, with the same productivity as in British factories in the 1970’s i.e where three people are employed to do one person’s job. The 50% increase in efficiency demanded by the bankers will therefore create an additional 20% unemployment, which will be of course socially catastrophic for the Greek people.

3. Greece for many years had the status of being a serene and peaceful holiday destination, with maybe not the best food in the world and of course being the only Western country, that doesn’t have a proper sewerage system, has never appealed to the top segment of the holiday market, but more for the larger numbers of tourists using package holidays. And in 2005 on the first day of the season, 17 planes arrived on the small island of Zakynthos, full of British holidaymakers. However since that time, prices in Greece have ‘gone through the roof’, because of the Euro and many many tourists are now spending their their holidays and their money in cheaper countries like Turkey. And considering that nearly 20% of Greek GDP comes from tourism, employing some 30% of the labour force, Greece will have a serious cash flow problem and will never be able to pay debts that practically keep doubling every year.

4. During the rapid expansion boom, practically every island got it’s own international airport, massive holiday complexes and sport stadia, all of which need tourists and Greek people to have money in their pocket to be able to use them, to pay off the loans, given by the banks to finance them. Unfortunately with a rapidly contracting world economy (in China they are already rioting in the streets), and as banks get into deeper and deeper trouble, this situation can only get worse, especially as tourists move on to a much cheaper Turkey etc.

5. Greece is a hot country and getting hotter and and if the Northern countries of Europe, like Germany and the Netherlands had the same temperatures as they have in Greece (on average 15-20 degrees warmer for 6 months of the year), their productivity rate would drop like a stone and they would be at least 30% less productive than they currently are and would become even more ‘unproductive’ than the Greeks.

6. Greece is an old country and is thousands of years older than the U.S. and it was the birthplace of democracy and it is both a religious country and a country, rich with traditions, which are not all to do with making money. Furthermore it has left-brained culture with a left-brained Education system, where analytical and scientific thinking is not the norm, which is why Greece can never compete with an extreme Right-brained culture and education system, the Germans have and therefore without many natural resources, will never be rich in the current economic system. And certainly Greece will never have the cash-flow to pay the $500,000 Million of debts they have, which will only increase as Interest rates go even higher and at the same time as their cash flow is decreasing.

7. With the exception of Germany, almost every Politician in Europe gladly accepted ‘almost free’ money from the banks to spread around freely to increase their popularity and of course their chances of being re-elected. Unfortunately it was the Greeks, the Irish and the Portuguese who got found out first and their populations will be now be punished hard, especially by the countries who ‘earn the money’ in Europe. But of course, exactly the same thing has happened in Britain, which has currently 18 times more International debt than Greece (currently at $9,000 Billion), with only 6 times the population. And at a certain moment there will be a ‘Black Swan event’, like for example when the Greek people say no to the banks and say farewell to their rather sick Politicians, who seem to even more stricken with M.G.S. (Money Greed Syndrome) than is usual in a European countries. N.B. M.G.S. is a crippling disease and can be described as ‘Dehydrated Left-brained-itis’, where people of power will do anything for more zeros on their bank account, without ever having a conscience about the serious consequences of their actions.

To conclude:

Greece, Ireland, Portugal, Spain (and Britain, because of it’s out of control banks) are all financially in deep trouble, and this will eventually effect everyone in Europe, both rich and poor. Of course Politicians and bankers will continue their game of ‘Extend (the loans) and Pretend’, but I doubt if hundreds of millions of people in Europe are just going to accept to having their livelihoods taken away from them to pay for the German, French, British and U.S. bankers ‘trillion Dollar hooliganism’ of the bankers for the next few decades. And it won’t be long before it doesn’t matter who the ruling party in any country is, because it will be irrelevant – as it is in Ireland, Portugal and Belgium today and sadly Britain and Germany tomorrow.

There are only 2 ways to get out this crisis:

1. Go back to the Bible and implement something called ‘Yobhel’ (or Jubilee), where every 70 years all debts are written off.

2. Politicians find the courage to force the bankers to pay for their own trillion Dollar (Proprietary Trading) gambling debts and understand that a vast number of loans were made without Due Diligence by the Bankers, to people , corporations which they knew could never be paid back.

OR

3. We all go back to the ‘good old days’ of the 1930’s, when the Swiss bankers made billions from the most profitable business on earth. But please note that this time around, they will earn ‘Trillions’

So may I suggest that Politicians get together and choose wisely for the sake of the children, before it is too late. Because it doesn’t have to be this way………………

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