I’m wondering how Obama will be blamed for this:
Ángel Gurría, head of the O.E.C.D., said ahead of the meeting that the euro-zone countries had to act “very fast.”
“It’s not a question of the danger of contagion. Contagion has already happened,” he told Bloomberg television. “This is like Ebola. When you realize you have it you have to cut your leg off in order to survive.”
The problem is that it is not just Greece, which expects to receive international aid, but Portugal, Spain and other countries that must issue more debt soon.
Obama is having his socialist pals in Yurope intentionally tank their economies to make it easier to impose one-word government under the auspices of Al Gore. It’s all so obvious that Beck only needs one chalkboard to explain it.
Ebola…isn’t that a virus that originates in AFRICA?
Maybe if he decided to massage Angela Merkel’s shoulders like Bush, she’d have decided to give more support to Greece.
I don’t think cutting off your leg will help with Ebola.
@stevie314159: And isn’t KENYA part of Africa? That was almost too easy.
Krugman was particularly Cassandra-like about the collapse of these European governments yesterday.
I just hope this doesn’t drag us into Recession 2: Electric Boogaloo, because that WILL be blamed on Obama, and then we will have President Palin, and then we will starve, and then we will die.
Thanks, Cole, for the morning news. Fuck you, too.
It was Krugman’s post yesterday that made me sit up and take notice, especially the end: “The question now is how far this will spread. I’m looking at the spread between Italian and German bonds […] It’s getting a bit scary out there.” IIRC, he was saying similar things before the economy melted down last time.
I know that we’re all in the shitter because of upholstered jackals like Goldman Sachs and the GOP. But I’m in serious trouble this month and could use a spot of help.
Oooh, I got another one: PIIGS stands for Portugal, Italy, Ireland, Greece, and Spain. It sounds like pigs, which they roast in Hawaii, which Obama claims he’s from when he’s really from Kenya. Or something.
Also, I believe you are underestimating the role Rahm Emmanuel and ACORN (or whatever it’s calling itself now) played in this.
Rumor has it there’s a 90bn-euro aid package being cobbled together. It was actually suggested that Greece sell off some of its islands in the Aegean. Merkel is supposed to speak later; we’ll see what she says. An aid package is pretty much Germany’s call.
countries must issue more debt?
O.E.C.D.=Obama Establishes Communist Dictatorship.
Like shooting fish in a barrel.
Here’s Simon Johnson:
The only logical action is a $30 trillion credit default swap.
IMO, there’s a subtext here– a lot of people just don’t like the Greeks very much at all. My guess is that there will be an attempt at delicate financial surgery– Greece gets cut off and pushed over the edge, Portugal gets towed back from the brink. In any event, sure would be nice if we all survive this.
@cleek: Sadist! Subjecting us to so much reality so early in the morning! Shame on you!
Definitely. Earlier in the year I remember reading something, part of an editorial from a German paper, I think, the gist of which was: “Stop being so goddamn lazy, you stupid stinky Greeks.”
This is not to say that anti-Greek sentiment has caused this problem, but it’s definitely coming to the surface now.
Fuck. Fucking fuckitty fuck. I’m a freelancer who’s had to dig deep into the emergency fund this winter, and who has just seen things starting to turn the corner over the past few weeks, and now everything is on the precipice today.
But I’m still better off than a lot of people. I still have some savings, I locked in my mortgage for a reasonable rate for the next 5 years, and I have single payer health care. I cannot envision what a double dip into the financial shit will do to people hanging on by their fingertips.
Goldman Sach’s was only one of the players in the international shadow banking empire that traded in synthetic derivatives. They were selling this crap that was known toxic to anyone and everyone with institutional investment funds. Teacher’s unions, school boards, county governments, pension funds, and yes, nations.
They sold it knowing it was gonna blow up because they were shorting (betting against it with Credit Default Swaps) the toxic waste.
Mortgage houses pushed toxic mortgages on unsuspecting people knowing they were gonna blow up because they were making big fees reselling them to the derivatives traders.
Citigroup, Countrywide, et al repackaged and sold these toxic mortgages to these traders knowing they were crap. They didn’t care cause they got awesome fees for the transaction.
And Greece, Iceland, Ireland, and teachers unions and pension funds all bought these falsely rated mortgage derivatives because Goldman et al and the ratings houses told them these were good investments.
The truth is coming out, but as was said in a previous thread…this should prompt a really really sternly worded letter.
These assholes really did put the entire western civilization’s financial system at risk and extracted hundreds of billions of dollars from middle class shoulders the world over, in the form of fees, payroll, stock dividends, payroll and bonuses.
Iceland’s already gone bankrupt, Greece is in process, Ireland, Spain and Portugal are lined up.
And the greatest fear we should have is that the truth about who what and why this happened will get very little honest exposure in the media. And all that will happen will be a really sternly worded letter.
And yes, these idiot tea baggers will blame Obama for not preventing this.
Just wait until the bottom falls out of the commercial mortgage market. Those same assholes poisoned that well too.
We really are fucked.
@LarsThorwald: “then we will have President Palin, and then we will starve, and then we will die.”
Nah, we wouldn’t starve. We’d go straight to the dying part, because the one thing she’d be able to figure out is how to get the US nuked.
String the fuckers up.
Things won’t have truly gone to shit until we see Germans calling for a return to the Deutchemark, the French demanding a return to the Franc, etc. Before that there’s some hope that Europe can pull itself together.
That said, I’m still at a loss to understand how more responsible nations such as Germany would suffer from a collapse in the less responsible states such as Greece. Wouldn’t markets recognize the difference in reliability between the two nations even though they use the same currency?
So when are we storming S&P?
“This is like Ebola. When you realize you have it you have to cut your leg off in order to survive.”
Remind me not to go to this man for medical advice.
Perhaps he meant that flesh-eating bacteria, which moves like lightening.
Ted the Slacker
Just want to point out that what is accelerating the crisis is the down-grading of Greek debt.
By the assholes that brought you AAA-rated subprime poo because Goldman paid them to.
This is not to say that Greece and friends don’t have serious problems to deal with, but they are being driven to the wall by the same crew that would have rated stuff if it had been “structured by cows”.
Comrade [email protected]: Anybody got any string?
I just checked on the condition of the US stock market at about 9:45. Down, down, down.
The market opens at 9:00, right? So all of this tumbling down has happened and we are not even through the first hour yet.
Oh, my goodness. Maybe I should rent a cave somewhere. Are they expensive? Or does it depend on the neighborhood?
please if I ever do have a hemorrhagic virus, don’t let that guy near me.
yeah, that was my thought. ebola liquifies you from the inside and you explode in an upside-down blood fountain.
So, in fact, it’s like an out-of-control flesh-eating bacterial infection. No link. Thank you for the clarification.
Greenwald will undoubtedly allege that all of this is the inevitable result of the world’s loss of confidence in the United States, which is entirely due to the fact that Guantanamo is still open and Dear Leader bailed on Dawn Johnsen.
However, Greenwald will be wrong. Everything bad that happens in Europe is Real Madrid’s fault.
Greece essentially had the economy of Mexico as compared to the rest of the EU. It’s going to take more than a decade to fix the damn thing. And yes, there is anti-
brown skinnedGreek sentiment going on here. West Germany pulled the same whinges when it had to absorb East Germany into its economy. They have similar problems in that their infrastructure hasn’t been upgraded since WWII and its going to cost a frack ton of money to get it up to speed. They will eventually make the investment and it will pay off big for everyone. Cause that’s what happens when you have real taxes and real public works projects.
Dow’s back up BTW
If all the countries default on their debt obligations, can I stop paying my credit cards & mortgage? Or will Lord Humungus be collecting my checks in that case?
The big concern is Spain. It could tip the “balance”.
These cheaters really did it this time.
I like Bloomberg radio because they say what is going on without drug addled opinions.
Spain is in better shape than the UK… they are truly fucked. Listen to the BBC on the radio (satellite). They are running huge deficits and with an election going on, every politician is ignoring the issue. Spain’s deficit is a smaller % of GDP and going up more slowly than the UK (which is a much bigger economy).
Ben, running a deficit is not the problem. In fact, deficit spending as stimulus during recessionary periods is the well tested and proven policy derived from New keynsian Macro-economics.
In this age of fiat currency, deficits are expected. What matters is the quality or rating of your nation’s perceived ability to pay on that debt. Not necessarily the debt itself.
Deficit spending as a buzz word, however, is a problem. Something the tea baggers are using to blind many of us to reality.
beware the epistemic closure!
The UK is in the slightly more enviable position of having a certain amount of fiscal independence from the EU wrt currency valuation and interest rates. That’s not to say that the UK is fine and dandy by any stretch, just that the country is a little bit more flexible.
But yeah, UK cuts are going to have to be wide-ranging and extreme, and no-one wants to talk about it because it’s scary and doesn’t get votes.
It opens at 9:30 a. m.
But it works for migrating nanobots.
A Red Dwarf reference!
Gotta love a screwed up metaphor.
Viral infections cannot be stopped by amputation. Gurria is thinking of gangrene, not ebola.
Let’s keep the OECD away from emergency rooms!
Shit man, I thought Europe was all sochalism and SUPERTRAINS.
Yglesias has a good post up.
You’ve been brainwashed by our librul media.
This is just one more sign that increasingly people feel there is no reason to say anything unless it is hyperbolic, hysterical, or both.
Not a confidence-builder
If you’re going to use a medical analogy to bolster your case for heartless, inhumane, drastic economic action, you probably ought to use an analogy to a diseases that actually does require drastic action to prevent its spread. Ebola doesn’t.
If you have Ebola, we don’t know of anything to do for you beyond supportive care to maximize your body’s chances of fighting it off itself. But one thing that clearly will not help, would be to cut off your leg. It’s not a localized disease within the body, it circulates in the blood. If you were one of the lucky ones, who would have recovered with supportive care, cutting off your leg would probably be what tips you over into dying anyway.
One suspects that this is the case with Greece as well. It might do better with just supportive care. Hacking off a limb at random is likely to only make a potentially survivable crisis, instead fatal to the Greek economy.
As far as contagion, the risk of spread to other countries, it’s hard to see how that’s massively relevant to what to do about Greece. If creditors overlent to other countries as well, if that disease of overlending has been in the world’s blood, the “disease” has already spread, and amputation of Greece, whatever that means, won’t help. Well, except maybe to satisfy some atavistic need for great and desperate cures that do more harm than the disease.
90 billion Euros? That’s probably what the board of Goldman Sachs is worth between them. Just confiscate it all and problem solved.