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Of the 250 billion Greece got,220 billion went to the banks

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Re: Of the 250 billion Greece got,220 billion went to the ba

Postby erolz66 » Wed Jul 15, 2015 10:27 am

GreekIslandGirl wrote:That's all very well and good, erolz, if the interest rate is set at a constant and reasonable amount - but when the banks also have the right to make decisions on increasing interest rates - whenever they want - based on some imaginary risk assessment, then you have the equivalent of loan sharks like Wonga where the amount you owe them becomes thousands of times greater than what you had initially.


When I take out a variable rate loan with a commercial bank, I agree an interest rate based on 'base rate' + a certain %. The difference between the interest base rate and the rate I pay is fixed for the entire life of that loan. The only part that changes is the base rate. The commercial bank I take the loan from does not set this base rate, that is done by the central bank (Bank of England if its sterling, ECB if its euros). The bank I take the loan from does NOT therefore have a "right to make decisions on increasing interest rates - whenever they want".
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Re: Of the 250 billion Greece got,220 billion went to the ba

Postby erolz66 » Wed Jul 15, 2015 10:36 am

GreekIslandGirl wrote:But, last time I saw figures, personal debt in Greece was among the lowest in Europe.


Some stats on household (personal) debt by country here

http://www.cityam.com/1411501631/debt-map
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Re: Of the 250 billion Greece got,220 billion went to the ba

Postby GreekIslandGirl » Wed Jul 15, 2015 11:42 am

erolz66 wrote:
GreekIslandGirl wrote:But, last time I saw figures, personal debt in Greece was among the lowest in Europe.


Some stats on household (personal) debt by country here

http://www.cityam.com/1411501631/debt-map


Yeah, thanks. That's pretty much as I recall, with UK households among the most debt-ridden. I think those figures don't include mortgages though. If they did, the UK would be even more shocking. Rather sad then when you hear them accusing Greeks of being greedy and living beyond their means. :roll:
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Re: Of the 250 billion Greece got,220 billion went to the ba

Postby erolz66 » Wed Jul 15, 2015 12:02 pm

GreekIslandGirl wrote:....living beyond their means. :roll:


Living beyond your means is not down to how much debt you have- its down to how much debt you take on that you subsequently are unable to service.
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Re: Of the 250 billion Greece got,220 billion went to the ba

Postby GreekIslandGirl » Wed Jul 15, 2015 12:12 pm

erolz66 wrote:
GreekIslandGirl wrote:....living beyond their means. :roll:


Living beyond your means is not down to how much debt you have- its down to how much debt you take on that you subsequently are unable to service.


Can Brits service their loans? I don't think that's happening; the numbers are going up - at the very least, most have mortgages or pay rent. The young are adding to debt with student loans - before they've even started working. Their only hope is the ever-easier ways of declaring bankruptcy and having zero-hour contracts that mean they don't have to start paying back or the promise that student loans are written off after 30 years of non-payment.

There is a cultural lackadaisical attitude to taking out loans in the UK.
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Re: Of the 250 billion Greece got,220 billion went to the ba

Postby erolz66 » Wed Jul 15, 2015 12:18 pm

Here is the info in the map I linked to in a table form for all the EU countries that had data and I could find on the map :) I though I had found Luxemburg but it turn out to be a bit of dust on my monitor :)

Denmark 64912
Netherlands 50181
Sweeden 38696
Ireland 38032
UK 29551
Finland 25535
France 22874
Belgium 19850
Austria 19771
Germany 19569
Spain 18051
Portugal 15184
Italy 15102
Greece 11482
Estonia 6544
Slovenia 5742
Czech Republic 4785
Slovakia 4526
Croatia 4136
Latvia 3871
Poland 3724
Lithuania 3304
Hungary 3101
Bulgaria 1728
Romania 1678

and in case anyone interested

Turkey 1677
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Re: Of the 250 billion Greece got,220 billion went to the ba

Postby erolz66 » Wed Jul 15, 2015 12:30 pm

GreekIslandGirl wrote: Can Brits service their loans?


The point I was making had nothing to do with if Brits or anyone else can service their household debt or not. I was merely trying to point out that the idea that if a country's people have a relatively low average level of household debt compared to other countries they can not then therefore be fairly 'accused' of 'living beyond their means, is in fact 'woolly thinking'.

GreekIslandGirl wrote:There is a cultural lackadaisical attitude to taking out loans in the UK.


Does everything for you HAVE to be turned into some kind of black and white criticism (or praise) for an entire nations people, based on if you 'like' or 'dislike' that particular nation or not ?
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Re: Of the 250 billion Greece got,220 billion went to the ba

Postby Robin Hood » Wed Jul 15, 2015 4:05 pm

Erolz66:
‘Woolly thinking’
....... I like that phrase and I assume you mean that those who fit the description are not fully in possession of the facts?

This is the first interview Yanis Varoufakis gave after he resigned and in it he describes his dealings with the IMF/ECB/EU. It was also made before the ‘agreement’ ..... that agreement YV said wouldn’t work and now even the IMF agrees it just does not work as it stands.

http://www.globalresearch.ca/yanis-varoufakis-full-transcript-our-battle-to-save-greece/5462328

At one point he is asked by Harry Lambert and replies to the following:
HL: What are you referring to? ( YV had said that……..the situation was worse than you imagined!)

YV: The complete lack of any democratic scruples, on behalf of the supposed defenders of Europe’s democracy. The quite clear understanding on the other side that we are on the same page analytically – of course it will never come out at present. [And yet] To have very powerful figures look at you in the eye and say “You’re right in what you’re saying, but we’re going to crunch you anyway.”

HL: You’ve said creditors objected to you because “I try and talk economics in the Eurogroup, which nobody does.” What happened when you did?

YV: It’s not that it didn’t go down well – it’s that there was point blank refusal to engage in economic arguments. Point blank. … You put forward an argument that you’ve really worked on – to make sure it’s logically coherent – and you’re just faced with blank stares. It is as if you haven’t spoken. What you say is independent of what they say. You might as well have sung the Swedish national anthem – you’d have got the same reply. And that’s startling, for somebody who’s used to academic debate. … The other side always engages. Well there was no engagement at all. It was not even annoyance, it was as if one had not spoken.


Now I have great empathy for YV in that situation because trying to explain economics to people who think they know everything about politics, finance, banking and accountancy and really believe they have the full picture is frustrating in the extreme! The problem is that none of those is based on the principals of economics.

Let me explain using your €200k ‘loan’ as an example? Your argument is reasonable until you introduce economics and then that exposes your 'woolly thinking'. You believe that if you have a debt to the bank you must owe them money. A reasonable enough belief but WHY? Because that is what they told you! In reality they were not telling you the truth!

The only time your €200k would be a loan is if you walked out of the bank with the €200k in notes! If you walked out with a promise or assurance that you had a loan, without them giving you the cash, then you have been conned …… the bank did not lend you a cent. All they did when you walked out of the office was to set up a line of credit. That is …. an account with nothing in it, simply a figure to represent to maximum credit level that had been agreed. They didn’t put money into your account ………. so they lied ……..… they did not loan you anything.

When you pass your cheque to the receiving party they pay it into their account and at that point it becomes real money (i.e. exchangeable for note and coin). When your cheque returns to your bank for clearance they pay it into your new credit account and the balance immediately drops to -€200k. So the bank now starts charging you interest on €200K ……. that did not exist until you passed a dud cheque!!! It is an accounting/book-keeping/ledger transaction ….. no money changed hands.

I have no doubt that YV was left in the position of explaining to these bureaucrats what this loan was in economic terms. Greece may well have a debt but where did this €350bn come from in the first place?

This explanation is 100% kosher and can be verified beyond a shadow of doubt ….. this IS exactly what happens when banks say they ‘lend’ money. This happens every time a commercial bank gives credit ……… they create a debt ……… they do not loan money …..…… the banking system creates it!!!!

Greece's debt is not quite so cut and dried as we are made to believe ...... and the same goes for the other EZ countries in debt. :argue: :wink:
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Re: Of the 250 billion Greece got,220 billion went to the ba

Postby Lordo » Wed Jul 15, 2015 4:26 pm

what greek peebol have or not do not have does come into this consideration. griik government borrowed money from the private banks and could not pay it back. they borrowed more money to pay them back. now they want to borrow even more to pay the last ones back. if they could not afford to pay the first lot or the second lot what makes anybody think that they can pay the third lot back. it aint rocket science that this aint working.
what they should do is go to wonga and consolidate all their loans into one loan. that will solve it.

they have no hidden charges, and you can decide how long you pay it back and they will not penilse you if you pay back early not that there is much chance of that happening.
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Re: Of the 250 billion Greece got,220 billion went to the ba

Postby tsukoui » Wed Jul 15, 2015 4:39 pm

Lordo wrote:what greek peebol have or not do not have does come into this consideration. griik government borrowed money from the private banks and could not pay it back. they borrowed more money to pay them back. now they want to borrow even more to pay the last ones back. if they could not afford to pay the first lot or the second lot what makes anybody think that they can pay the third lot back. it aint rocket science that this aint working.
what they should do is go to wonga and consolidate all their loans into one loan. that will solve it.

they have no hidden charges, and you can decide how long you pay it back and they will not penilse you if you pay back early not that there is much chance of that happening.

But they do penilise me :cry: I'm sorry for hijacking this forum for my own interests, every time I open my mouth they ask me what I know :cry:
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