ΕΙΠΑΝ .....
ΚΑΙ ΕΣΕΙΣ ΔΙΑΛΕΓΕΤΕ ΚΑΙ...ΠΑΙΡΝΕΤΕ !!
THEY SAID....
UP TO YOU TO CHOOSE !!!
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《 WHAT IF GREECE DEFAULTS ? 》
When the newly inaugurated president , Adolfo Rodriguez Saa ,
announced to Congress on the 23th of December 2001 , that
" the Argentine state will suspend the payment of its
foreign debt " , legislators jumped to their feet with joy .
Their cheering quickly morphed into a chant of
" Ar-gen - ti -na ! Ar- gen - ti-na !! "
Today , it is Greece , led by a recently elected populist
left-wing part , Syriza , that is contemplating a similarly drastic
unilateral declaration of independence from foreign creditors
and international financial institutions .
Economists like Nouriel Roubini , a professor at N.Y University , have long
argued that " Greece should default and abandon the euro , using Argentine-style
measures to prevent a disorderly fallout " . Far from the sky falling in , they
say , Argentina's economy soon roared back to prosperity .
Greece should follow suit .
But were the years that followed really so rosy for the people of Argentina
?
They will certainly be Greeks ready to hail Syriza's leader , Alexis
Tsipras , on Day 1 of the great experiment
.
Mr Rodriguez Saa received a similarly emotional response when he went
before Argentina's powerful General Confederation of Labor .
" I believe in social justice " , the president shouted , almost drowned
out by ecstatic labor bosses .
" I believe in the revolutionary passion of Eva Duarte de Peron " .
The president believed that a default was the correct political response to
the unbridled free-market policies of the 90s , which had pushed Argentina into
its worst-ever economic crisis .
He also wanted to distance himself from the pro-capitalist Peronistas who
had led Argentina into this dead end , by invoking Evita herself , the
unofficial saint of Argentina's descamisados , or " shirtless ones " .
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Perhaps the spirit of Evita could exorcise what many had come to see as the
excesses of a political successor like Carlos Menem , a Ferrari-driving Peronist
who was president from 1989
to 1999 . Mr. Menem orchestrated a temporary economic boom by privatizing
state assets , dropping import barriers and liberalizing labor laws .
But he also failed to place any social safety net beneath the unemployed
put out of work by his free-market shock doctrine - a sin for which , to this
day , few forgive him .
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By 2001 , the nation was caught in the painful crucible of recession anf
inflation .
Mr. Saa , appealed to Argentines as a rebellious , nationalistic cry of
independence from the free-market conditions dictated by the international
creditors .
The sense of triumph was short-lived ...
A week after announcing the default , Mr Saa resigned .
Soon , Argentina lurched into a nightmarish chaos .
Economic activity was paralyzed , supermarket prices soared and
pharmaceutical companies withdrew their products as the peso lost three quarters
of its value against the dollar .
Because of the virtual bankruptsy of the main private medical insurance
firms and the collapse of the public health system ,
badly needed cancer , H.I.V and heart drugs soon became scarce . Insulin
for the country's estimated 300.000 diabetics disappeared from drugstores
shelves .
With the economy in free fall , about half of the country's population was
below the poverty line .
The country's middle class took to the streets by tens of thousands with
pots and pans held high , clanging them into what became the echoing beat to
Argentina's 2002 social collapse . A run on the banks had already forced the
resource-
- starved government to enact the most draconian economic measures in
Argentina's history .
Savings accounts totalling $66 billion were frozen across
the country . Depositors started protesting inside banks .
Soon , most of Argentina's banks were boarded up with thick wooden panels ,
on which depositors banged their pots and pans angrily .
Well off Argentines could get around the restrictions .
In back rooms , large account holders were able to unofficially withdraw
thousands of dollars at a time , or even wiring their savings abroad through a
growing black market .
For the rest , hundreds of barter clubs popped up around the country . Some
were the size of shopping malls , set up in the abandoned hulks of closed
factories .
Thousands of cashless and hopeless Argentines flocked to them. At makeshift
stalls , haircuts were traded for
psychoanalysis sessions . Apple cakes for clothes .
By early 2002 , the network of clubs was enrolling tens of thousands of
glum-faced members every week .
When the supply of pesos dried up because of the bank freeze , some of the
biggest of the barter clubs began printing their own
currency , the credito...
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Eventually , Argentina did recover .
By 2004 , the economy was booming again under a new Peronist
president , Nestor Kirchner , who stared down the IMF and applied his own
brand of economic common sense .
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It may fall to the historians to decide how much of the crash was
attributable to Argentina's defiant default and how much to the irresponsible
application of the Menem era free-market reforms .
But the price of the default for those who lost everything , most
of them from the lower middle class , who didn't have the resources to
survive the freeze on bank withdrawals , was brutal.
Many cash-strapped families were forced to sell their homes at ridiculous
prices to the better off who still had access to ready money .
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Greeks would do well to realize what may follow if they back a Syriza-led
default and exit from the eurozone .
They may be stamping their feet for Mr. Tsipras today .
Tomorrow , they could be banging their pots in protest....
Why Europe will never give up Greece ? }
( Marc Faber )
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Preventing Russian influence in the Mediterranean , is the real
reason why Europe will NEVER allow Greece to leave the Euro zone ,
according to global investor M.Faber...
Greece is generally regarded as a getaway to the Mediterranean,
it is also a key NATO outpost in the Balkans .
If there's a Grexit , " the Russian fleet can move into the
Mediterranean from the Black Sea " , Faber said .
Faber's theory is underscored by European worries of closer ties between
Athens and Moscow following Greek PM Alexis Tsipras'
visit to Moscow in April .
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" GRIMBO " : The new thing to worry about in Greece ...
( UBS , Wealth Management ).
After the famous " GREXIT " and the less utilized " GRACCIDENT"
neologisms for the Greek situation emerge daily within the analyst
community .
Worth mentioning is " Grimbo " - a contraction of Greece and limbo , a
situation in which would default but would remain in the Eurozone . Also notable
is a rampant form of " GREXHAUSTION ".....
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" A bitcoin-like solution for Greece " ?
This approach is a hybrid of a parallel currency and an asset-backed
security . Combining the attributes of a digital currency and an asset backed
security would result in several benefits .
1. Greece would retain ownetship of its highly prized state assets ,
satisfying the voter mandate to curtail privatization .
2. The currency could be used to pay government salaries and workers would
be able to spend the currency at local businesses
providing a much needed economic boost .
3. This creates an investable asset that would be a proxy for a recovery
of the Greek economy.
4. Greek banks could hold this hybrid asset instead of Treasury
Bills . The asset backing would immediately strengthen
bank balance sheets .
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DO YOU REALLY NEED MORE TO MAKE UP YOUR MIND ?
IF YES , WAIT TILL ...TOMORROW !!!
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