What happens if Greece leaves the euro?

getz

t4k30 wrote: »

Who cares about Greece. What we need is The UK or at least England to join the Euro !!

i dont think the UK will ever join the euro,they have just handed over £9,billion to the EU to prop up the euro

Économiste Monétaire

Where are you getting the £9 billion figure from?

getz

Économiste Monétaire wrote: »

Where are you getting the £9 billion figure from?

it was on the radio news[smooth radio] north west england,at 0630 this morning

noodler

Yeah I read about the €9bn somewhere myself.

Flamed Diving

We like to maintain a strict standard with references on here.

Any chance of a link?

noodler

While we are on the subject? Where have the EU actually announced the figures being thrown around in every medium today?

EDIT: NM found it

http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/ecofin/114324.pdf

Hasschu

To answer to the question "What happens now" . First if you are Irish you heave a deep sigh of relief. We are now standing on solid ground after almost three years in a quagmire. Germany and France by not deciding to rescue their domestic banks directly have demonstrated that they have placed their faith in the future of the EU and the Eurozone. Germany and France have rallied the solvent members of the Union to come to the aid of the insolvent and near insolvent members. Ireland and the like countries in sunnier climes are now in a position where they know they can roll over their sovereign debt at reasonable rates and can not be held for ransom by New York or London bankers, hedge funds and other opportunists. We and our sisters to the south are now in a difficult situation which is a quantum leap above where we were last week which was in a hopeless situation. Every country in the Union has now ceded some power to Brusels, Frankfurt and Strasbourg. We should be doubly grateful to the solvent countries for their willingness to make that sacrifice in addition to the immediate cost of the aid. The insolvent and near insolvent countries were in the position of beggars not being choosers but they should thank their lucky stars and Doktor Merkel for being courageous enough to take the political hit in Nord Rhein Westphalia and elsewhere in the future. Our gov't is now in a position to work the country out of its present predicament without the slightest shadow of a doubt. If we rescue defeat from the jaws of victory we will have no one to blame but ourselves. I might add that Ireland ceding power to European institutions is a good thing and anyone who thinks otherwise should take off their green tinted glasses and take a good look at our performance recently and before we joined the EEC.

noodler

What an amazing yield turnaround for Ireland. From 5.9% to 4.7% in a matter of 12 hours.

The Greek fall in yields is even more incredible.

cavedave

Marginal revolution has some interesting observations today.
The first here is about how weird the hoops this plan has to jump through are

a specially created off-balance-sheet entity will borrow the money, as needed, and then lend it out to the country or countries in trouble. The special entity's borrowings will be guaranteed by euro-zone countries — excluding the country asking for aid. This construction helps skirt the EU treaties' prohibition on one state's assuming the debt of another

And there are a number of ideas here

3. The major European powers would not have come up with a nearly $1 trillion bailout, also involving de facto loss of ECB independence, unless they were scared ****less.
5.Basically the ECB is monetizing bad government debt claims.
9. This doesn't solve any of the basic fiscal problems, so ultimately it raises the stakes and creates a chance of even greater financial failure.

Hasschu

Christine LaGarde French Minister of Economy interview in Les Echos.
Google translate very readable.

http://translate.google.ca/translate?hl=en&sl=fr&u=http://www.lesechos.fr/info/inter/020532446257-christine-lagarde-le-plan-de-soutien-un-tournant-historique-.htm&ei=9YXpS-SoGIP_8Abmsa2XDg&sa=X&oi=translate&ct=result&resnum=1&ved=0CBgQ7gEwAA&prev=/search%3Fq%3Dhttp://www.lesechos.fr/info/inter/020532446257-christine-lagarde-le-plan-de-soutien-un-tournant-historique-.htm%26hl%3Den%26client%3Dfirefox-a%26hs%3DicD%26sa%3DG%26rls%3Dorg.mozilla:en-GB:official%26channel%3Ds

Hasschu

A translation of the comments on Christine Lagarde, Minister of Economy interview. The French are a bit more complicated than what we are accustomed and it is not all due to translation.


http://translate.google.ca/translate?hl=en&sl=fr&u=http://commentaires.lesechos.fr/commentaires.php%3Fid%3D020532446257&ei=N43pS-HdG8L-8AaIv_XLBw&sa=X&oi=translate&ct=result&resnum=1&ved=0CBoQ7gEwAA&prev=/search%3Fq%3Dhttp://commentaires.lesechos.fr/commentaires.php%253Fid%253D020532446257%26hl%3Den%26client%3Dfirefox-a%26hs%3DzlY%26sa%3DG%26rls%3Dorg.mozilla:en-GB:official%26channel%3Ds

Chipboard

Title of this thread is kinda funny - What happens if Greece leaves the Euro?

Would it not be more meaninful to start a thread in boards.ie called - What happens if Ireland leaves the Euro?

If Greece can leave Ireland can leave and remember, whilst we may think we're worlds apart from the Greeks, the international markets put us firmly in their little club of PIGS (Portugal, Ireland, Greece, Spain).

Good stuff which has happened in the last few months

• Car sales have picked up (aided somewhat by the scrappage scheme)

Bad stuff which has happened in the last few months

• It is now accepted that Nama is not going to encourage one cent of lending by the Banks.
• Even though the government are aware of this they haven't done anything to address it like establish a National Recovery Bank.
• The standoff in the housing market has not ended as sellers refuse to lower their prices.
• Some of the bailed out banks have increased lending margins for existing borrowers i.e. the people who are paying for their bailouts.
• Further job losses.
• Ireland has contributed to a bailout of another Euro country (biggest joke this year).
• The banks are still understating their loan losses. Watch this space!!!
• The government announce they are going to collect an additional €3bn in taxes in their quest to tax their way out of this.
• Not one of the criminals who caused this has been brought to book.
• Nama official shows their true colours by saying they will pursue big developers who flaunt their wealth - why would they have to flaunt it for Nama to pursue them, wouldn't having it not be good enough reason to pursue them?

noodler

Theres more positives than just car sales in fairness.

Retail sales as a whole are also up 3 months in a row.

Live Register actually fell. Not great news in itself but does give hope the Unemp has bottomed out.

Our Bond Auctions in 2010 have been very successful (although the last one benefited from the ECB intervention in the secondary market).

We also have technical inflation, some people would say this a good thing but it seems to be totally from morgtage rate increases and not much else. Still, deflation is making us more competitive.

PMIs in Manufacturing and Services are also seeing growth again.


Tha banks can hardly lend money at rates lower than they themselves are borrowing it.
NAMA in itself may not be increasing lending, but surely you can recognise the scheme was a necessary first step?

I don't know where you got €3bn in taxes from, everything I have heard suggest it will be €1bn each from capital, current and taxes.

I completely agree about loan losses though. There is likely to be some serious hits in the near future when mortgage loans begin to fail (FR only took into account the possibility of 5% of the mortgage book failing in the recapitalisation figures).

Flamed Diving

PIGS is such a childish little tabloid acronym.

cavedave

Chipboard

Title of this thread is kinda funny - What happens if Greece leaves the Euro?

Would it not be more meaninful to start a thread in boards.ie called - What happens if Ireland leaves the Euro?

It might be more meaningful but also more likely to descend into a slanging match. Are the only meaningful threads those that deal with Ireland solely?

Flamed Diving

Not to mention the fact that we already have a forum for ranting about Ireland.

http://www.boards.ie/vbulletin/forumdisplay.php?f=1196

In fact, it was created to filter that style out of here.

Chipboard

Flamed Diving wrote: »

Not to mention the fact that we already have a forum for ranting about Ireland.

http://www.boards.ie/vbulletin/forumdisplay.php?f=1196

In fact, it was created to filter that style out of here.

Remember Flamed Diving, that one of the reasons that we are in the mess we are is because certain people who broke from the pack and said trouble was on the way were told to shut up. Things are going to happen in the next couple of years that the likes of you will find difficult to accept because you think that the last few years were the norm and the current difficulties are just an aberration. Don't you dare tell me what to say.

Chipboard

cavedave wrote: »

It might be more meaningful but also more likely to descend into a slanging match. Are the only meaningful threads those that deal with Ireland solely?

Point taken Dave. What I meant was that I think its coming down the tracks for us too, but I could have put it better.

Hasschu

As I understand it the consensus is that Greece will have its back to the wall in 3 to 5 years. Which means it will be beyond saving by the EU, ECB or IMF. That leaves sovereign debt default as the only way out. That does not mean it will leave the EU or the EMU nor does it mean it will be pushed out. The EU, EMU and the ECB are displaying a commendable degree of flexibility in the present circumstances and no doubt they will be there to pick Greece up when it falls on its sword.
Ireland has created enormous problems for itself when FF decided to bail out the failed banks. Our chickens come home to roost as the full magnitude of the banks liabilities come to light. As it stands the continuing deficits and the need to roll over debt at higher interest rates means we will be staggering on the edge of the precipice by 2013. The much anticipated V recovery is not happening in Europe, North America or Japan. Brazil and Latin America alone will not float this boat.

Snackie

What happens if Greece leaves the euro?
Nothing in fact