So Freddie was thinking about where to go for his next holiday. Should it be Ireland, pretty nice in the Summer with cool warm sunny days, maybe a little drizzle in the Summer but not much otherwise going on as the Celtic tiger has long since stopped roaring. Portugal has even warmer summer days with a gentle breeze coming in off the atlantic ocean, again not much going on outside of the soccer season. Spain, pretty hot in the Balearic nightclubs with all those drunken Brits with their "tramp stamps" raving the night away. Although, without all those tourist jobs and the delights of Benidorm the unemployment rate would be much higher than 20% and counting. Finally, Freddie thinks of Greece and it's beautiful islands (even Corfu has it's charm for the investment bankers who stay on the other side of the island), but hold on, aren't they rioting about something - other than the riots, the only thing going on is the rent. Spotted a theme building here? I'll give you a clue. A while ago, the investment banking community was reprimanded for referring to these countries as the "PIGS" (I'll spell it out for you: Portugal; Ireland; Greece; and Spain). For once the bankers got something right, although a pity they lent so much money to these countries without bothering to check if anybody there actually manufactured anything of use.
So where is this walk around summer holiday destinations going? Well, all the above have a single currency - pretty helpful for a chap and his family on their summer holidays as you don't have to get quite so badly mugged by those bad boy bankers as you won't get ripped off at the bureau de change counter if you happen to be a resident of the Eurozone. Unfortunately the bad boy bankers and their out of control buddies the politicians have had us all (even the Brits have to pay for the Euro) long before you board that holiday jet. You see they've sold Jose Public a Ponzi scheme from hell!
Here's how it goes, I sell you a story about integration, economic harmonisation, never having to worry about exchange rate movements and all this great stuff and all of a sudden we have the Euro. We tell lots of people about how great this is and they all buy into it and join the Euro club. For all the politicians this is great because they've brought all these countries together and can jointly determine their economic and fiscal policies at their big love-in's (otherwise known as Eurozone Finance Minister meetings). Even better, Germany and France (I now refer to their politicians, not their populations, as "Beavis and Butthead") can tell everybody what to do and they become the big boys on the block. You see, it's all about POWER over you and me - with a few more thousand jobs for the boys thrown in as well.
Only trouble is, to coin a well used phrase by James Murdoch, "this is a really important point", not all countries and their economies are the same. When a country gets into trouble, it can't use the exchange rate to get it out of trouble any more, ooops! So what's the solution when the glory boy politicians realise that nobody works in Greece for anybody other than the government and those that don't work for the government have no interest in paying taxes. Errrrmm, I know what, we'll lend them more money so nobody thinks a Eurozone government would default on it's debt. So what happens when they won't pay back the new money - perhaps we make them pay more taxes or spend less??? Nope, we extend the time period for them to pay back their loans and lend them even more money. Sound like a plan? Not really, sounds like a Ponzi scheme (otherwise known as pyramid selling) that would make Bernie Madoff proud! Beavis and Butthead really do rule Europe......
Look at the figures, on the face of it Greece has just cost another EUR 109 billion in it's second bail out - only trouble is, what about the cost of Spain, Ireland, Portugal and ITALY??? Well, my friends at the investment banks see this as costing over EUR 2,000 billion, ooooops big time! Put another way, the debts of Germany and France would go way over 100% of GDP, bet they never told their voters about that cost! Still, the good news is the politicians will still find a way of blaming it on the bankers whilst everybody else picks up the bill (let's face it,the banker's must have behind this with their pesky complicated spreadsheets that nobody else understands).
So where is our t0 thoughts on this?
Well, first of all it's another in the ever growing list of don't allow politicians any more power over our lives - we always end up with the bill! Not all countries are the same, some people actually work in the real world (private sector).
Second, and more importantly, don't lend to people who can't pay you back! Isn't this what caused the financial crisis in the first place. It doesn't make any difference if it's a country, corporation or individual - if they can't pay then they won't pay!
Finally, if you go on holiday to a country and can't see what they do beyond selling ice creams - then don't lend them your hard earned cash. You can't expect them to be able to pay you back. Not rocket science, is it? Don't try and prop up economies by throwing good money after bad. You know what my conclusion is, time to re-set the clock and start again!
So endeth my latest sermon on the bleeding obvious but very expensive. By the way, I have to admit that I thought the Euro was a cracking idea in my banking days - it meant I no longer had to worry about exchange rate fluctuations in those totally meaningless but very expensively put together spreadsheets.
For all those eurosceptics out there, don't worry Freddie has a lot more to say on this subject but the missus is giving me evil stares so I'm calling it a day for now. However, before I come back to the Euro, I'll be giving you some insights into the life of the ever popular, but recently resigned, UK's Special Representative for International Trade and Investment and Industry. Otherwise known as Air Miles Andy (or Prince Andrew as he's known to lovers of royalty).
So where is this walk around summer holiday destinations going? Well, all the above have a single currency - pretty helpful for a chap and his family on their summer holidays as you don't have to get quite so badly mugged by those bad boy bankers as you won't get ripped off at the bureau de change counter if you happen to be a resident of the Eurozone. Unfortunately the bad boy bankers and their out of control buddies the politicians have had us all (even the Brits have to pay for the Euro) long before you board that holiday jet. You see they've sold Jose Public a Ponzi scheme from hell!
Here's how it goes, I sell you a story about integration, economic harmonisation, never having to worry about exchange rate movements and all this great stuff and all of a sudden we have the Euro. We tell lots of people about how great this is and they all buy into it and join the Euro club. For all the politicians this is great because they've brought all these countries together and can jointly determine their economic and fiscal policies at their big love-in's (otherwise known as Eurozone Finance Minister meetings). Even better, Germany and France (I now refer to their politicians, not their populations, as "Beavis and Butthead") can tell everybody what to do and they become the big boys on the block. You see, it's all about POWER over you and me - with a few more thousand jobs for the boys thrown in as well.
Only trouble is, to coin a well used phrase by James Murdoch, "this is a really important point", not all countries and their economies are the same. When a country gets into trouble, it can't use the exchange rate to get it out of trouble any more, ooops! So what's the solution when the glory boy politicians realise that nobody works in Greece for anybody other than the government and those that don't work for the government have no interest in paying taxes. Errrrmm, I know what, we'll lend them more money so nobody thinks a Eurozone government would default on it's debt. So what happens when they won't pay back the new money - perhaps we make them pay more taxes or spend less??? Nope, we extend the time period for them to pay back their loans and lend them even more money. Sound like a plan? Not really, sounds like a Ponzi scheme (otherwise known as pyramid selling) that would make Bernie Madoff proud! Beavis and Butthead really do rule Europe......
Look at the figures, on the face of it Greece has just cost another EUR 109 billion in it's second bail out - only trouble is, what about the cost of Spain, Ireland, Portugal and ITALY??? Well, my friends at the investment banks see this as costing over EUR 2,000 billion, ooooops big time! Put another way, the debts of Germany and France would go way over 100% of GDP, bet they never told their voters about that cost! Still, the good news is the politicians will still find a way of blaming it on the bankers whilst everybody else picks up the bill (let's face it,the banker's must have behind this with their pesky complicated spreadsheets that nobody else understands).
So where is our t0 thoughts on this?
Well, first of all it's another in the ever growing list of don't allow politicians any more power over our lives - we always end up with the bill! Not all countries are the same, some people actually work in the real world (private sector).
Second, and more importantly, don't lend to people who can't pay you back! Isn't this what caused the financial crisis in the first place. It doesn't make any difference if it's a country, corporation or individual - if they can't pay then they won't pay!
Finally, if you go on holiday to a country and can't see what they do beyond selling ice creams - then don't lend them your hard earned cash. You can't expect them to be able to pay you back. Not rocket science, is it? Don't try and prop up economies by throwing good money after bad. You know what my conclusion is, time to re-set the clock and start again!
So endeth my latest sermon on the bleeding obvious but very expensive. By the way, I have to admit that I thought the Euro was a cracking idea in my banking days - it meant I no longer had to worry about exchange rate fluctuations in those totally meaningless but very expensively put together spreadsheets.
For all those eurosceptics out there, don't worry Freddie has a lot more to say on this subject but the missus is giving me evil stares so I'm calling it a day for now. However, before I come back to the Euro, I'll be giving you some insights into the life of the ever popular, but recently resigned, UK's Special Representative for International Trade and Investment and Industry. Otherwise known as Air Miles Andy (or Prince Andrew as he's known to lovers of royalty).
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