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http://money.cnn.com/2015/02/09/news/economy/alan-greenspan-greece-will-leave-euro/index.html?section=money_news_international&utm_campaign=Feed:%20rss/money_news_international%20%28International%20News%29&utm_medium=feed&utm_source=feedburner&iid=ob_article_footer&iid=obinsite

The former Federal Reserve Chairman told the BBC that Greece's best course of action is to leave the Eurozone. But Greenspan didn't stop there. He predicts Greece's exit is the beginning of the end for the euro.
"Short of a political union, I find it very difficult to foresee the euro holding together in its current form," Greenspan told the BBC's Mark Mardell on Sunday.
Greenspan went as far as to say the world would be better off without the euro. He says the currency union is too complex unless Europe decides to have one unified governing body to call all the shots.
Greece is a good example of the uneasy strain of the currency union. The country is mired in debt that it can't figure out how to pay back. The Greek people are so fed up with all the cutback measures imposed by Eurozone leaders that they recently elected a new prime minister, Alexis Tsipras, who campaigned on a platform of fighting back.

Economics is probably my weakest subject, so I don't really have input on this. Any thoughts?

Greece is considered a joke of a country in Europe. It's a leech that feeds on EU funds, has zero economy bar tourism and will likely go bankrupt anyway because their "government" has no clue on what they're doing.

The entire EU simply doesn't work in its current state. It basically is a system of several countries carried by German, parts of Scandinavia and GB. The rest just hangs onto their skirts.

TTIP will cause some momentum to swing back in the right direction.

TTIP?

Transatlantic Trade and Investmen Partnership. Basically shifting power back to where it belongs, i.e. the economy.

If, by the economy, you mean big corporations who want to be able to do what they want without regulation, sure!

The Eurozone needs a closer political union to solve it's problems. We need consistent fiscal policy and a greater democratic say in what happens at a European level.

Greece could well be the end of the Eurozone, but only if the people of Europe let it happen that way.

 Da Boss wrote:
If, by the economy, you mean big corporations who want to be able to do what they want without regulation, sure!

That's typical naive leftist propaganda, nothing more. TTIP allows for companies to overcome political, or rather national political, barriers that harm people more than they'd do good for. The problem with TTIP is that most people simply have no idea what it's about.

Greece could well be the end of the Eurozone, but only if the people of Europe let it happen that way.

Greece is dead weight. Same as Romania and such.

Greenspan is probably right that Greece will leave in time. A Greek exit could lead to markets trying to push other vulnerable economies like Spain, Italy and Portugal out. It's hard to explain the mechanisms but these countries could face much higher interest rates when they want to refinance public debt. A default could force these countries to leave the Euro zone reinstate new currencies and devalue to inflate their debt away and increase competitiveness. No one knows how the markets will react though and whether or not the ECB will be able to fend off a speculative attack.

Greece, or at least the people, would have been better off if Greece had left the EU immediately and devalued a new currency. The 5 years of austerity have brutal on the general population. Keeping the Greek government on life support allowed the rest of Europe to shore up the financial sector. The immediate threat of a European bank sector collapse by contagion from exposure to Greece is mostly gone as a large part of the bail out money was used to buy up their debt share.

In the interview Greenspan is quite careful with his predictions. He points at the differences in the economies between the northern and southern parts of Europe which would need further regulation or integration in future to deal with the imbalance suggesting it's all down to politics. The BBC interviewer is particularly interested in the problems and future break up scenarios and leads the interview along those lines, which isn't strange given the skeptical position of the British media towards Europe.

So long as states actually function the Euro will exist. It may shrink for a time, but once the incompetence is weeded out others states will come back to it. The economic benefits of membership outweigh not being part.

When you have different states of various economic might linked together by a single currency it is not going to end well.

Didn't Spain go bankrupt a few years ago?

The entire experiment was a flawed one.

You can't have multiple independent economies tied together with a single currency. Its just going to make the stronger economies weaker with the weakest ones leeching off of them, and never learning to support themselves.

The only possible way for the Eurozone to work would be for economies that are both of similar strength and that are tied together with the same factors. Europe isn't one giant economy. Its a half dozen or so. Trying to cross the lines with a unified currency was a recipe for disaster.

Given the fact members can't be forced out, the only way the Euro will fail is if the stronger countries decide to pull out(which would be the smart move as the stronger members are being bled out by it with little gain in return) leaving the weaker economies still in the Euro. Then it will fail. But I doubt that will happen as there isn't exactly the most intelligent decision making going on there.

 Sigvatr wrote:

 Da Boss wrote:
If, by the economy, you mean big corporations who want to be able to do what they want without regulation, sure!

That's typical naive leftist propaganda, nothing more. TTIP allows for companies to overcome political, or rather national political, barriers that harm people more than they'd do good for.

So, exactly what Da Boss was saying then.

In what world is it a good thing that private actors can overrule democratically elected legislatures? It's utterly insane.

 AlmightyWalrus wrote:

 Sigvatr wrote:

 Da Boss wrote:
If, by the economy, you mean big corporations who want to be able to do what they want without regulation, sure!

That's typical naive leftist propaganda, nothing more. TTIP allows for companies to overcome political, or rather national political, barriers that harm people more than they'd do good for.

So, exactly what Da Boss was saying then.

In what world is it a good thing that private actors can overrule democratically elected legislatures? It's utterly insane.

Don't forget, America's health and safety and standards are years behind European ones.

 welshhoppo wrote:

 AlmightyWalrus wrote:

 Sigvatr wrote:

 Da Boss wrote:
If, by the economy, you mean big corporations who want to be able to do what they want without regulation, sure!

That's typical naive leftist propaganda, nothing more. TTIP allows for companies to overcome political, or rather national political, barriers that harm people more than they'd do good for.

So, exactly what Da Boss was saying then.

In what world is it a good thing that private actors can overrule democratically elected legislatures? It's utterly insane.

Don't forget, America's health and safety and standards are years behind European ones.

Many of Europe's so called "Health and Safety" standards are totally irrational. Like banning GMOs or other controversial products which have repeatedly been shown to be completely safe.

 Grey Templar wrote:

 welshhoppo wrote:

 AlmightyWalrus wrote:

 Sigvatr wrote:

 Da Boss wrote:
If, by the economy, you mean big corporations who want to be able to do what they want without regulation, sure!

That's typical naive leftist propaganda, nothing more. TTIP allows for companies to overcome political, or rather national political, barriers that harm people more than they'd do good for.

So, exactly what Da Boss was saying then.

In what world is it a good thing that private actors can overrule democratically elected legislatures? It's utterly insane.

Don't forget, America's health and safety and standards are years behind European ones.

Many of Europe's so called "Health and Safety" standards are totally irrational. Like banning GMOs or other controversial products which have repeatedly been shown to be completely safe.

And most of them aren't. Your point is?

America actually has sensible health laws which leave room for personal freedom, and actually uses scientific research to determine if something is safe or isn't.

 Grey Templar wrote:
America actually has sensible health laws which leave room for personal freedom, and actually uses scientific research to determine if something is safe or isn't.

Oh, so you're looking for a national pissing match? Good luck, lemme know how it works out for you.

No. I was just clarifying my point.

I'm not sure that EU is good enough that artifically keeping it alive is such a good idea.


Automatically Appended Next Post:

 welshhoppo wrote:

 AlmightyWalrus wrote:

 Sigvatr wrote:

 Da Boss wrote:
If, by the economy, you mean big corporations who want to be able to do what they want without regulation, sure!

That's typical naive leftist propaganda, nothing more. TTIP allows for companies to overcome political, or rather national political, barriers that harm people more than they'd do good for.

So, exactly what Da Boss was saying then.

In what world is it a good thing that private actors can overrule democratically elected legislatures? It's utterly insane.

Don't forget, America's health and safety and standards are years behind European ones.

Only the mean one. Wouldn't be surprised if the median living standard was much higher in the US.

 Grey Templar wrote:
The entire experiment was a flawed one.

You can't have multiple independent economies tied together with a single currency. Its just going to make the stronger economies weaker with the weakest ones leeching off of them, and never learning to support themselves.

The only possible way for the Eurozone to work would be for economies that are both of similar strength and that are tied together with the same factors. Europe isn't one giant economy. Its a half dozen or so. Trying to cross the lines with a unified currency was a recipe for disaster.

Given the fact members can't be forced out, the only way the Euro will fail is if the stronger countries decide to pull out(which would be the smart move as the stronger members are being bled out by it with little gain in return) leaving the weaker economies still in the Euro. Then it will fail. But I doubt that will happen as there isn't exactly the most intelligent decision making going on there.

It's the opposite situation, strong economies like Germany have greatly benefited from the access in terms of exports and access to the rest of the EU and continue to do so post crisis. The weaker economies in turn benefited until recently from the low interest rates the Euro provided.

 Grey Templar wrote:
No. I was just clarifying my point.

In which case, what are the personal freedoms that America preserves that the evil EU oppresses with its Draconian laws?

 AlmightyWalrus wrote:

 Grey Templar wrote:
No. I was just clarifying my point.

In which case, what are the personal freedoms that America preserves that the evil EU oppresses with its Draconian laws?

The freedom of choice.

But that's derailing the thread so we should get back on topic.

Britain is lucky that it didn't dive in when the Euro was getting set up. The GBP is still rolling along as it always has.
There's a referendum due very soon to see whether we stay in the EU, too. We need European trade to stay afloat, but open borders and laws from afar are causing big problems, too.

 Grey Templar wrote:
America actually has sensible health laws which leave room for personal freedom, and actually uses scientific research to determine if something is safe or isn't.

Or we could argue the US puts profits of companies before the health of citizens. It's not as black and white as you claim at all.

 AlmightyWalrus wrote:

 Grey Templar wrote:
America actually has sensible health laws which leave room for personal freedom, and actually uses scientific research to determine if something is safe or isn't.

Oh, so you're looking for a national pissing match? Good luck, lemme know how it works out for you.

WE didn't bring up the US, you evilz fereners did.

The thought that Italy is an underperforming economy vs the economic powerhouse that is Belgium is...interesting.

You can have different states with differing economic levels. Most countries are actually like this. However to do that you have to have the same government, central bank, etc.

Thats do-able, but rarely is it done democratically. ok I've never seen it done democratically. Now is the time for Switzereland to strike. Ein Volk Ein Land Ein Franc!

There is no doubt that the Euro has problems resulting from the different states of the various countries that have entered into it. This is because it was primarily a political project not an economic one. That said, other currency unions eg the USA have had and continue to have problems with individual states defaulting or going effectively bankrupt, and somehow continue to function economically and politically.

 Kilkrazy wrote:
There is no doubt that the Euro has problems resulting from the different states of the various countries that have entered into it. This is because it was primarily a political project not an economic one. That said, other currency unions eg the USA have had and continue to have problems with individual states defaulting or going effectively bankrupt, and somehow continue to function economically and politically.

Difference is that the federal reserve system was (and probably still is) far more resilient than national bank supervision in the Eurozone. If say California would default, regional banks wouldn't hold most of the debt nor would it create a domino effect through the US financial system. It took the Euro crisis to convince the politicians that separating banks and sovereigns was necessary and this lead to the creation of the banking union.

And Europe has taken note and strengthened its central bank. The Euro can be made to work if the political will exists.

 Kilkrazy wrote:
And Europe has taken note and strengthened its central bank. The Euro can be made to work if the political will exists.

If the rest of Europe just did as Britain said...

 Kilkrazy wrote:
And Europe has taken note and strengthened its central bank. The Euro can be made to work if the political will exists.

This^^

Thanks to the larger role that the BCE has played after the Euro crisis something like Greece defaulting on its debt and leaving the Euro wouldn't have nearly the same catastrophic effect that it would have had a few years ago when that debt was concentrated on private banks and governments. Either this Greek government falls or they leave the Euro and possibly the EU, neither of those scenarios will be registered as more than a blip by the remaining countries and why would it? Every other country has already finished their re-adjustment program and the BCE's debt buyback plan will take care of any remaining Greek debt that could contaminate the rest of the monetary system.

As for the TTIP, the corporations can continue to kiss it goodbye, it goes against anything that the EU stands for and I highly doubt that it will ever see the light of day.

PhantomViper wrote:

As for the TTIP, the corporations can continue to kiss it goodbye, it goes against anything that the EU stands for and I highly doubt that it will ever see the light of day.

It will come and everyone with knowledge on the matter will confirm it. What will happen is that a "light" TTIP version is implemented on an official level to please the general public and shortly after, restrictions will continue to be mitigated and, ultimatively, removed. 99,9% have no idea what TTIP is about and they will celebrate a "weaker" form as a victory. Politicians all around are pleased as voters are satisfied, and companies are pleased as everything works as it was intended to. In the end, as usual, it's the economy that has the higher leverage and will, as usual, come out victorious. Time's on our side.