The way i see it,Greece is following a way leading straight to bankrupcy.The question is,what do you think the impact on the rest of the EU will be? My evaluation is,the EU won't survive longer than 3 years... After Greece's bankrupcy,countries with a massive debt (Italy,Spain,even the US) will start having problems Greece has faced too,and eventually go bankrupt.Problem is,I'm afraid to even think of a worldwide military force such as the US going bankrupt,as there certainly will be shocking effects (possible war,even though I don't think that was ever a possibility after the invention of nnuclear bombs). Your opinions on the matter?
it's simple. greece is already in a hole, so we are already feeling the impact of their debt.
I doubt the U.S. will allow itself to go bankrupt, too many people rely off of the goverment/economy. if it went bankrupt, then the world economy could quite possibly be dragged along with it.
I doubt the U.S. will allow itself to go bankrupt, too many people rely off of the goverment/economy. if it went bankrupt, then the world economy could quite possibly be dragged along with it.
Not quite possibly, it will. We've already seen what a US-based recession did in 2008, imagine it going bankrupt. Anyway, it never will go bankrupt, since it keeps right on borrowing to stay afloat.
The thing about debt is that it's not necessarily a bad thing. Japan is mired in debt, but it's still rather healthy because much of the debt is domestic owned, essentially the government owes its own people money.
Problem is,I'm afraid to even think of a worldwide military force such as the US going bankrupt,as there certainly will be shocking effects (possible war,even though I don't think that was ever a possibility after the invention of nnuclear bombs).
How will this lead to war? I see no possibility. The vaguest I get is when the US refuses to pay back its debts, which leads to its creditors going to war (Read, China). This is highly unlikely given the close ties between both economies, and also because a state devastated by war will find it hard to pay back (Versailles anyone?).
Also, just a major correction to war being a non-possibility after the invention of nuclear bombs. This is clearly false, one just has to look at the Cold War for a whole range of examples of possible breakouts of war with nuclear arms. The Cuban Crisis is just one example. This I doubt will come to pass now though, as mentioned earlier, the economic dependency of the major world economies on each other.
I hope the Greeks accept their austerity cuts, given the obnoxious welfare payments they get, it's incredulous as to them claiming they don't owe a cent.
What do I think will happen? I hope welfare systems around the world get evaluated, retirement age pushed up (61 is a ridiculously young age to retire). The EU would be much more stringent on clearing possible members (They slipped up checking Greece's economic condition before accepting them.)
I doubt the EU will fail, since the major states will still bail the rest out since any fallout will cause their own economies to crash and fall too.
It's hard to evaluate what's going to happen with Greece, there are so many different possibilities and variables, although a lot of the potential outcomes I see aren't particularly good for the European economy as a whole. Things get even more complicated when you realize that the UK (which provides a relatively large amount of money to the EU) is holding a parliamentary referendum about the future of the UK in the EU which could see us providing much fewer resources to failing economies such as Greece.
i think that greece should get their ***** off the chair and start working. it's not the 1st time a country go's bankrupt. stop rioting and demonstrating. take the impact. and show europe that you can work. greece is in europe know as that rich country were people don't have to work so much and are realy relaxed. but it seems you were not rich afterall. then it's now time to start working. (they also should stop using the argument that germany owns them billions/trillions of money for ww2 damage. the marshall plan fixed all that)
look at argentina they went bankrupt 10 year ago. and now they are doing very well and have a growing economie ever since.
First of all The government is going to make us broke. Greece is not helping. Barrak wasted our money to fix roads that didn't even need fixing. I look on another road witch they wont pay attention to and I see it needs to be paved over.
At least bother to spell the name of your President correctly. Anyway, the whole 'road fixing' idea might not be such a bad one, it creates jobs in the construction sector and improves transport links while also putting money into the local economy (through the aforementioned creation of jobs).
Anyway, the whole 'road fixing' idea might not be such a bad one, it creates jobs in the construction sector and improves transport links while also putting money into the local economy (through the aforementioned creation of jobs).
Yes I believe fixing roads are a good idea. However, my grampa is still driving through roads needing to be paved. I am telling you he is going to make America bankrupt.
First of all The government is going to make us broke. Greece is not helping. Barrak wasted our money to fix roads that didn't even need fixing. I look on another road witch they wont pay attention to and I see it needs to be paved over.
Look, road fixing as you call it and all the other mundane jobs he created helps. Why? Because it gives unemployed people something to do. This generates money for them, hence they can spend, hence money flows in the economy again.
Yes I believe fixing roads are a good idea. However, my grampa is still driving through roads needing to be paved. I am telling you he is going to make America bankrupt.
I see no link between your point ''My Grandpa needs the roads he used paved'' and your conclusion ''Obama is going to get America bankrupt.''
Not quite possibly, it will. We've already seen what a US-based recession did in 2008, imagine it going bankrupt. Anyway, it never will go bankrupt, since it keeps right on borrowing to stay afloat.
The thing about debt is that it's not necessarily a bad thing. Japan is mired in debt, but it's still rather healthy because much of the debt is domestic owned, essentially the government owes its own people money.
Debt must eventually be payed off. If debt isn't payed off, then it is no different than theft. The US can only borrow money for so long.
Anyway, the whole 'road fixing' idea might not be such a bad one, it creates jobs in the construction sector and improves transport links while also putting money into the local economy (through the aforementioned creation of jobs).
If a road that doesn't need fixed is fixed, then money is wasted. Yes, jobs were created when the government hired people to fix roads, but the money to fix those roads come from taxes, taxes that come from the private sector. So when the government spends, say, 100,000 dollars on hiring men to fix roads, then there's 100,000 dollars less in the private sector, which results in a loss of jobs or a loss of private sector profit (both are detrimental to the economy).
If the solution was as simple as having the government hire more people, then we could have the government give everyone a job making sculptures of dildos to through out in the middle of the sea. This doesn't happen, because this would hurt the private sector and the economy as a whole.
Government spending, in itself, does not ever create jobs. You can argue that government spending can create efficiency, which in turn stimulates the economy, but that's a different debate. The spending itself does not, however, create jobs without destroying other sectors of the market.
Sorry about the double post, but let me quickly address the following...
Look, road fixing as you call it and all the other mundane jobs he created helps. Why? Because it gives unemployed people something to do. This generates money for them, hence they can spend, hence money flows in the economy again.
You're falling victim to the Broken Window Fallacy:
Let us imagine a small town. A hoodlum decides to throw a brick through a baker's window. The hoodlum runs off unidentified. The people gather around the broken window and they look at the baker who is distressed that he now must pay 100 dollars for a new window. The people talk amongst themselves but one man decides to look at the positive consequences and says, "It's not too bad, the baker will buy a new window from a glazier, providing the glazier with more business." Another man turns around and says "Yeah! And that glazier will be able to spend money on a new oven that he's been wanting!" A third smiles and says "It looks as if the hoodlum actually benefited society!"
The people, however, made one great error. They forgot to take into consideration what would have happened had the hoodlum not thrown the brick through the window. If the hoodlum never through a brick through the baker's window, the baker would have 100 dollars to buy a new suit from the clothier. The clothier would, in turn, have 100 dollars to buy a new refrigerator. The hoodlum did not stimulate the economy, he merely changed the flow of money. If the hoodlum really did benefit society, then we would be ever so much more rich if we went around destroying towns.
The reason I explained the broken window fallacy is because you are only looking at the money that is going towards the, previously, unemployed. You're not taking into consideration how the money could have been spent if it had not been taken out in taxes.
If the government spends 200,000 dollars repairing roads, the workers are now 200,000 dollars richer. However, you must remember that the money comes from taxes. Let's suppose that each person has to pay an extra 10 dollars in various taxes. 20,000 people are now 10 dollars poorer, and there is now a collection of 200,000 dollars that won't be spent on other goods and services, making the rest of the market 200,000 dollars poorer.
The parable, also known as the broken window fallacy or glazier's fallacy, demonstrates how opportunity costs, as well as the law of unintended consequences, affect economic activity in ways that are "unseen" or ignored.
Well, this isn't applied that well or entirely well here. Why? Because it's already a recession, or at least a low growth rate. Without stimulation from the government, money will not flow already. It's the whole Keynesian idea of animal spirits.
The reason I explained the broken window fallacy is because you are only looking at the money that is going towards the, previously, unemployed. You're not taking into consideration how the money could have been spent if it had not been taken out in taxes.
The money wouldn't even flow if not for the roads and other such government works.
If the government spends 200,000 dollars repairing roads, the workers are now 200,000 dollars richer. However, you must remember that the money comes from taxes. Let's suppose that each person has to pay an extra 10 dollars in various taxes. 20,000 people are now 10 dollars poorer, and there is now a collection of 200,000 dollars that won't be spent on other goods and services, making the rest of the market 200,000 dollars poorer.
Well....in response, taxes are already levied, recession, or no recession. How about we not assume a person has to pay an extra tax since this isn't happening now?
