Japan's Amari says Greek crisis won't severely hurt global economy

[Aepsilons]

Japanese Economics Minister Akira Amari said on Tuesday the Greek debt crisis won't inflict severe damage to the global economy as long as policymakers respond calmly to the situation.

"What we must avoid by all means is a contagion driven by a bias (towards negative market) sentiment," Amari told a news conference after a regular cabinet meeting.

While Tokyo stock prices plunged on Monday, they are holding up Tuesday morning in a sign markets are gradually digesting the situation, he added. (Reporting by Leika Kihara; Editing by Chang-Ran Kim)

Japan's Amari says Greek crisis won't severely hurt global economy| Reuters



@TaiShang buddy.

Yoiishhhh!

 

[Aepsilons]

 

[Georgeclark]

But, if Greece leaves Eurozone, then Europe will topple and consequently the World

 

[Audio]

But, if Greece leaves Eurozone, then Europe will topple and consequently the World

Nah.....Greece is zero in terms of real economy. Only thing they have is tourism (should do good this year-have a friend in tourist agency, she says imba demand for Greece-ppl counting on low prices due to crisis), olives and largest shipping fleet in the world (which is operating just fine, shippers didn't even feel the crisis).

It's not the lack of money (ECB printing can cover Greek debt in 5 months-60 bill€/month printing; roughly 300bill€ debt-QE wasn't designed for this ofcourse-but just to give you a sense of scale) but noone wants to keep throwing money into that pit.

 

[Aepsilons]

But, if Greece leaves Eurozone, then Europe will topple and consequently the World

No. get real.....Greece is zero in terms of real economy. Only thing they have is tourism (should do good this year-have a friend in tourist agency, she says imba demand for Greece-ppl counting on low prices due to crisis), olives and largest shipping fleet in the world (which is operating just fine, shippers didn't even feel the crisis).

It's not the lack of money (ECB printing can cover Greek debt in 5 months-60 bill€/month printing; roughly 300bill€ debt-QE wasn't designed for this ofcourse-but just to give you a sense of scale) but noone wants to keep throwing money into that pit.

Both of you gentlemen have valid points. And to be quite honest, I don't think the Greek administration will risk said effects on their and the regional (possibly global) economy. Let's remain calm until Monday starts, lol.

 

[Georgeclark]

Both of you gentlemen have valid points. And to be quite honest, I don't think the Greek administration will risk said effects on their and the regional (possibly global) economy. Let's remain calm until Monday starts, lol.

Yup, true and the votes are going to be No for sure. See this video here bro

 

[Audio]

 

[Aepsilons]

Yup, true and the votes are going to be No for sure. See this video here bro

I'll watch the video, buddy.

My point of view and my analysis: Long term wise I think what the Greeks need to do is drop the EURO currency.
The euro is a huge obstacle to Greece's return to fiscal health. In a country with its own currency, a government can use inflation to reduce the value of its debts relative to its tax revenue. Issuing more currency makes prices and wages rise, but the amount owed to debtors stays the same. The Greek government can't issue more euros, however; only the European Central Bank can. Nor can the Greek government depress the value of its currency to help its exports, a common strategy for hastening an economic recovery.

A return to the drachma would put the tools of monetary policy back in Greek hands. It would almost certainly lead to a default, too, since the government would have a hard time putting together enough depreciated drachmas to pay its euro-denominated debts. But after an initial scare, the country would be well equipped for future growth. Tourism and other exports would undoubtedly benefit from having a flexible currency, as would purchases of Greek assets by foreigners.

PS. Poland doesn't use the Euro, by the way.

@Audio --- my friend, i think the best bet for Greece is to , long term wise, drop the Euro. Perhaps follow Poland's style. Your view of the possibility of this happening?

 

[Georgeclark]

I'll watch the video, buddy.

My point of view and my analysis: Long term wise I think what the Greeks need to do is drop the EURO currency.
The euro is a huge obstacle to Greece's return to fiscal health. In a country with its own currency, a government can use inflation to reduce the value of its debts relative to its tax revenue. Issuing more currency makes prices and wages rise, but the amount owed to debtors stays the same. The Greek government can't issue more euros, however; only the European Central Bank can. Nor can the Greek government depress the value of its currency to help its exports, a common strategy for hastening an economic recovery.

A return to the drachma would put the tools of monetary policy back in Greek hands. It would almost certainly lead to a default, too, since the government would have a hard time putting together enough depreciated drachmas to pay its euro-denominated debts. But after an initial scare, the country would be well equipped for future growth. Tourism and other exports would undoubtedly benefit from having a flexible currency, as would purchases of Greek assets by foreigners.

PS. Poland doesn't use the Euro, by the way.




@Audio --- my friend, i think the best bet for Greece is to , long term wise, drop the Euro. Perhaps follow Poland's style. Your view of the possibility of this happening?

True, the Video says the same. Long Term vise. they need to drop the Eurozone

 

[Audio]

@Audio --- my friend, i think the best bet for Greece is to , long term wise, drop the Euro. Perhaps follow Poland's style. Your view of the possibility of this happening?

Sure, i suppose. The easy way out. There's just one problem with this theory...namely they weren't particularly successful with drahma as well. If they were, noone would need to cook their books in order for them to join € in the first place. It's a mentality problem.

Idk if you've read what i wrote in another thread in re to Greece, a short anecdote from my grandpa, member of former Yugoslav CP.....he told me even in his times they had a saying to speak of someone who is indebted which roughly translates "in debt like Greece".
If this was coming from Yugoslavia, itself far from a model of fiscal solvency...iirc, insolvent for the last decade and a half of it's existence.......

As for hard predictions, i wouldn't dare say anything...However, i do think, if they adopt the drahma again, it'll be valued quite low and Greece a net importer of mostly all required commodities will still be in trouble.

Here's Greece's export tree....

as you can see, dominated mostly by low value added industries (agriculture, infrastructure components)

OEC: Greece (GRC) Profile of Exports, Imports and Trade Partners

^^ check balance in above categories between exports and imports.....they are in deficit in almost all.

 

[Georgeclark]

Sure, i suppose. The easy way out. There's just one problem with this theory...namely they weren't particularly successful with drahma as well. If they were, noone would need to cook their books in order for them to join € in the first place. It's a mentality problem.

Idk if you've read what i wrote in another thread in re to Greece, a short anecdote from my grandpa, member of former Yugoslav CP.....he told me even in his times they had a saying to speak of someone who is indebted which roughly translates "in debt like Greece".
If this was coming from Yugoslavia, itself far from a model of fiscal solvency...iirc, insolvent for the last decade and a half of it's existence.......

As for hard predictions, i wouldn't dare say anything...However, i do think, if they adopt the drahma again, it'll be valued quite low and Greece a net importer of mostly all required commodities will still be in trouble.

Here's Greece's export tree....

as you can see, dominated mostly by low value added industries (agriculture, infrastructure components)

OEC: Greece (GRC) Profile of Exports, Imports and Trade Partners

^^ check balance in above categories between exports and imports.....they are in deficit in almost all.

This is a quite detailed report

 

[Audio]

This is a quite detailed report

It's actually an overview for a lot of countries, economical composition and so forth. Where it says Greece, there's a dropdown menu in which you select a country. Quite useful for wannabe strategical analysts like me.

 

[Georgeclark]

It's actually an overview for a lot of countries, economical composition and so forth. Where it says Greece, there's a dropdown menu in which you select a country. Quite useful for wannabe strategical analysts like me.

ehehehh Add me in too xD