Friday, July 22, 2011

Greece defaults, but let’s call it 'Margaret', or 'Mary-Ann'

When you examine the ‘aid’ package agreed last night to bail out bankrupt Greece (again) and keep the euro afloat, it amounts to a default. When you borrow cash on agreed terms and repayments cease because your bank account is empty, you’re not suffering a temporary cash-flow problem: you’re bankrupt. So if the lender should be stupid enough to lend you even more cash simply to enable you to go on paying him, it doesn’t take a dumbed-down GCSE in maths to work out that this money merry-go-round is a fiscal illusion. But this has been hailed as another great triumph of EU solidarity, and so Presidents Barosso, Van Rompuy and Papandreou drank champagne into the early hours of the morning, in awe of their economic flair and wonder at their political skill.

But while they call it ‘aid’, ‘restructuring’ and a ‘comprehensive agreement’, it amounts to default.

President Sarkozy said: "If the rating agencies are using the word you just used (default), it is not part of my vocabulary. Greece will pay its debt," he told assembled journalists and reporters.

Not in his vocabulary?

It reminds His Grace of a decade ago, when, much to the concern of British Euro-sceptics, a European Army was formed under the guise of a collaborative peacekeeping force. The then President of the European Commission, Romano Prodi, dismissively responded: “If you don't want to call it a European army, don't call it a European army. You can call it 'Margaret', you can call it 'Mary-Ann', you can find any name, but it is a joint effort for peacekeeping missions - the first time you have a joint, not bilateral, effort at European level."

You see, in the EU, not only can a word can mean whatever you want it to mean; if a word causes difficulty or inconvenience, a myriad of alternatives are available to make the concept palatable. Don’t like ‘European Army’? Call it ‘Margaret’ or ‘Mary-Ann’. Don’t like ‘European Constitution’? Call it ‘The Lisbon Treaty’. Don’t like ‘EU Taxation’? Call it ‘Value Added’, etc., etc.

Greece has defaulted, and that's beyond dispute. But, if it makes you feel better, we’ll call it ‘restructuring’. It’s a nice, progressive, positive, optimistic word, implying forward momentum, denoting accord and agreement. Yes, private lenders will be forced to contribute a considerable chunk of the €109bn package, but let’s not focus on that. The important thing is that a clear signal is sent to the markets to show the EU’s determination to ‘stem the crisis and turn the tide in Greece, thereby securing the future of the savings, pensions and jobs of our citizens all over Europe’.

And so the Nikkei index rose 1.2%, while the Hang Seng was up 1.5%. US stocks are up 1.2%, and the share prices of vulnerable EU banks rose by more than 5%, led by our very own Barclays, which ended 7.8% higher. As news of the agreement broke, the euro reached a two-week high against the dollar.

And everybody is happy.

Can these fools not see that this is all a farce? What on earth happens when this latest bailout runs out? Where will the next €100bn package come from? Will the Greeks mortgage the Acropolis? Sell Crete? Auction off Patmos, Lesbos and Corfu?

Short-termism is, of course, a natural consequence of the democratic cycle: since politicians are held directly accountable to their electorates only every four years or so, there is little incentive for them to implement unpopular policies today when they can be shunted off for their heirs and successors to grapple with tomorrow.

So we get sticking-plaster politics and antiseptic economics, when what is needed is immediate, remedial surgery and amputation.

But sufficient unto the day is the evil thereof. So let’s deal with balms, lozenges, tonics and panaceas to restore the stability of the eurozone.

Sadly, none will cure the cancer.


Blogger Sean said...

or as Karl Popper said "It is impossible to speak in such a way that you cannot be misunderstood."

These crooks exploit this to its zenith,liars to the last the lot of them

22 July 2011 at 10:08  
Blogger Span Ows said...

They know, we know; they know we know, we know they know we know...the word you use, 'farce' is the appropriate word.

If it were their own money it would be a little more acceptable.

22 July 2011 at 10:11  
Anonymous Anonymous said...

Your Grace

You are the 21st century’s answer, to the previous century’s Orwell.

22 July 2011 at 10:30  
Anonymous permanentexpat said...

Not even Kafka could have constructed the convoluted nightmare which is the EU and its one faux-currency for all.
They are all utterly bonkers.

22 July 2011 at 10:31  
Anonymous JayBee said...

This is now a debt liability Union.
Extend, pretend, and inflate your way out of trouble. More of the same medicine and hoping for a different outcome.
Meanwhile the periphery can hide escalating problems under the cloak of the triple A rating of the core, and rating agencies will probably turn a blind eye to a default to preserve global stability. Have they put enough in the kitty to cap Italian and Spanish bond yields? I doubt it.
EU economic growth in the South is stagnating already and it will send the debt level trajectories into orbit. Once this reality kicks in it will all start to unravel again. Sarkozy's statement about this being a one off for Greece and they won't do it for another country will come back to haunt him. Those he thinks are too big to fail are too big to bail.

22 July 2011 at 10:43  
Blogger Maturecheese said...

When will the MSM in this country tell us the truth. If the true horror of the situation was reported correctly maybe then the British people would demand action on our membership of this corrupt regime.

It's a shame 'Burning our money' no longer blogs as that particular blog seemed to have its finger on the pulse of financial shenanigans, not that it would make any difference to most peoples perceptions as most people rely on the msm.

22 July 2011 at 10:50  
Anonymous Anonymous said...

And so it goes on – without our permission (referendum on the EU).

Our government does not have any money.

So it borrows (and puts us in debt). That borrowed money is then given to a government who cannot possibly pay it back and who gives the money to bankers (massive interest payments).

The money borrowed by our government has to be repaid (to the bankers it has borrowed from).

So they take our money through taxation (and ensure that our children face a lifetime of debt (through taxation)).

And at the moment we cannot do anything about it because we have forgotten the cornerstone of our constitutional inheritance:

We, the people, are sovereign.

22 July 2011 at 10:56  
Anonymous n said...

Humpty Dumpty sat on the wall,
Humpty Dumpty had a great fall,
All the kings horses and all the kings men,
Couldn't put Humpty together again.

Proverbs 16:18 "Pride goeth before destruction, and an haughty spirit before a fall."

22 July 2011 at 10:56  
Anonymous Anonymous said...

You grace

The planet will burn before they give up.

22 July 2011 at 11:07  
Blogger Span Ows said...

It's a shame 'Burning our money' no longer blogs as that particular blog seemed to have its finger on the pulse of financial shenanigans...

I think that is because one particular blooger from BOM is now nearer government.

n, well said!

22 July 2011 at 11:15  
Anonymous Paleo said...

They could always sell us the Elgin Marbles for - oo - lets say
£100,000,000,000. Cheap at half the price.

22 July 2011 at 11:17  
Anonymous Anonymous said...

Caller asks Radio Brussels:

‘Was the EU invented by politicians or by scientists?

Radio Brussels answers:

‘Of course it was invented by politicians. Scientists would have tested it on monkeys first.’

22 July 2011 at 11:46  
Anonymous Jack Flash said...

They are thieves, liars and scam artists. All of them.
Mr Singh, We the people are not sovereign I'm afraid, until we have a Parliament that listens to the voice of the people, the people who have cried out for ages against this legalised band of brigands and liars. A Parliament of honest English yeoman who have the guts of their ancestors to stand against this tyranical charade of egotistical chancers, and say enough is enough. Game over. We're off!.
Until that happens we will either be classified as rebellious Euro sceptics.
Or become the unthinkable alternative, Euro serfs.
Until then, EEC rules Albion.


22 July 2011 at 11:49  
Anonymous Anonymous said...

Here’s one for you Jack.

President Rompuy received a letter from Austria requesting approval for a new Navy.

This puzzled him, as the Republic was landlocked and so he queried the request

The reply soon came "France has a Ministry of Culture, so why can't we have a Navy?"

Rompuy: “Why didn’t you say that in the first place? Of course you can.”

22 July 2011 at 11:52  
Anonymous gladiolys said...

Nobody in their right mind would by Crete.

22 July 2011 at 11:56  
Anonymous gladiolys said...

Sorry, by = buy

22 July 2011 at 11:58  
Anonymous Voyager said...

They could always sell us the Elgin Marbles for - oo - lets say
£100,000,000,000. Cheap at half the price.

Why should we buy them TWICE ?

22 July 2011 at 11:58  
Anonymous Jack Flash said...

More likely Gollum would sell the Austrians ours and pocket the proceeds. I can see it now, Austria: "But the English Navy has no ships. They can't afford them since they joined the EU".
Gollum: " What do you need ships for?, you're landlocked. Now about the EEC mooring fees...".


22 July 2011 at 12:01  
Anonymous Anonymous said...

That's the spirit, Jack. The Devil don't like being mocked.

Be patient - we'll have them.

22 July 2011 at 12:06  
Anonymous Jack Flash said...

Nice picture YG, reminds me of three old hags from MacBeth. maybe
Margeret, Mary Ann and Mabel.Up to no good as usualKeep up the good work!.


22 July 2011 at 12:36  
Anonymous Paleo said...

"They could always sell us the Elgin Marbles for - oo - lets say
£100,000,000,000. Cheap at half the price.

Why should we buy them TWICE ?"

Just working by EU Central Bank Rules....

22 July 2011 at 13:06  
Anonymous Anonymous said...


22 July 2011 at 13:08  
Anonymous Jack Flash said...

C'mon Paleo they need the money, I hope three hags count their fingers after they've released their death grip on one another. It's hard to open another bottle of bubbly with a digit or two missing.


22 July 2011 at 13:24  
Blogger Paul Twigg said...

As usual the EU summit is a bag of hot air- they have produced zero new money to really did with this crisis if they are really intent upon saving the Euro. I am not sure how Chancellor Merkel will get this deal through the Reichstag because it is the first step of a transfer union- i.e. Germany will be forever transfering cash to Greece and club med for decades to come.

The markets will eventually wake up and realise that this smoke and mirrors (akin to when Gordon Brown was chancellor) solves nothing and the real choice- full transfer union with an EU Treasury and a common Euro bond- or the exit of the Club med states & Ireland from the Euro will have to be made.

For Britain's part, we should not be paying a single penny into any rescue fund as we are not in the single currency (thankfully) and in fact we could be lobbying for a sterling bloc- a loose association of sovereign states for who want to trade with each other- for those countries who are fed up with Euro control and Euro domination & France and Germany forever telling everyone else what to do.

22 July 2011 at 13:52  
Anonymous Old Blue Eyes said...

And still we participate in this farce called the EU. When will our politicians wake up.

22 July 2011 at 14:00  
Blogger Dodo the Dude said...

gladiolys said...
"Nobody in their right mind would by Crete."

If the price is right it would make a nice sanctuary for Dodos (I've got a family now) and protect us from the horrors of the modern world.

How much would Greece accept? I'm thinking of asking the WWF to secure it, with assistance from the National Lottery.

22 July 2011 at 14:15  
Anonymous Anonymous said...

A Briton walks into a post office in Brussels and complains: "These new stamps with Rompuy’s head on don’t stick..."

The clerk answers: "Citizen, you probably spit on the wrong side."

22 July 2011 at 14:45  
Anonymous Anonymous said...

This is Cranmer Radio; our British listeners asked us:

“Why is the EU not in a hurry to land their astronauts on the moon?”

We’re answering: “What if they refuse to return?”

22 July 2011 at 15:28  
Anonymous Anonymous said...

The Greeks are not daft, why pay to be a member of the EU, when you can get the EU to pay you to be a member.

Can't Cameron negotiate a deal like that for Britain, after all it would only be our own money they are giving back.

22 July 2011 at 17:22  
Anonymous Anonymous said...


I like your theory, we should implement this without further ado!.

22 July 2011 at 20:50  

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