Random Musings- Greece, America & apathy

~ A pie chart breakdown of where Greece's bailout money goes.  Only 19 cents on the dollar, or rather euro actually go back to the Grecian economy i.e. its populace.

No one respects deadlines anymore...

Frustrating... just frustrating..

The big news out of Greece over the weekend was that its leaders had just 24 hours to work out a deal with its EU, ECB & IMF creditors that would complete the selling of their nation and souls to their creditors.

Only 24 hours for Greece's leaders to agree to "the minimum wage be cut to less than 600 euros ($790) a month ($4.94/hr) and that at least one holiday allowance, the so-called 13th and 14th wages, be abolished, and pensions paid by supplementary funds should be cut by 35 percent" (AP)

Just 24 hours to agree to this harsh austerity or Default.

And what happens??   Talks extended into Monday...

Not sure what there really is to talk about.  The choices are really like an evil person saying "We will cut your left and right arm off as well as your right foot, or we will kill you outright"   How much deliberation does one need on a choice like that?  When does the pride instinct kick in?

We've learned and observed many lessons over the past 39 months.  Among them is that few to no world leader truly cares about its people, especially in a crisis, and when the choice is between reality and can-kicking, everyone including the common people want it kicked.  Happily so.

Also learned that few people in the US have really been affected so far by this recession.  Most of the people hurt and harmed were those in such bad shape from policies of the last 30 years that even in economic boom, they'd be going bankrupt, foreclosed upon and all that.  Very few others have.

You walk in most malls.. still see it bustling.. still see plenty of vapid, anti-social, technology addicted teenage morons with their headphone buds in ears and texting away without a care in the world.. Still see plenty of consumers consuming with credit cards swiping and registers cha-chinging all the live long day.. Still see people emotionally oblivious to everything outside their immediate family and more immediate needs.

The biggest lesson learned with few exceptions is that in this whole global economy narrative of crumbling banks, bailouts, recession and supposed "recovery", from politicians to investors to everyday people, there really is no one to cheer or root for.  And so few heroes.

Politicians are corrupt, bankers/financiers are evil, Investors are vermin and most everyday people won't fight back in any meaningful way.  Could be apathy or a fear that god-forbid, all their 'stuff' will be taken from them.  And the youth- they have the most cause to fight since every 18yr old college student without a silver spoon or teat to suckle upon, becomes a debt slave via student loans before legally allowed to take their first drink.  And that debt never, ever, Ever go away... Even in a bankruptcy.

In other parts of the world, youth fight back, or at least try to.

Angry Youths Attack House Of Greek President Papoulias; Hurl Rocks, Molotov Cocktails (AP) -- "About 30- 50 Greek youths arrived by motorbike and on foot just after 8 p.m, hurled a Molotov cocktail, rocks and paint at the house but stopped short of attacking the two guards at the President’s house"

In America, they sit outside in parks for days and weeks on end sipping coffee from thermoses while listening to their ipods and texting nothing important while mainstream America ignores them.

Either we've become That lazy and detached a nation, or those suffering the most still believe so much in the whole Left-Right political canard that no one wants to embarrass or hurt Obama's chances at re-election with a sincere dust-up.   I can't imagine such restraint if McCain/Palin were running the nation with exact same economic policies or even say a Bush third-term.

So, deadline extended in Greece one more day.  We still assume all will be worked out to the powerful banking interests' will...  or who knows, be extended another day.

Greece is the nation that invented democracy.   Would be nice if they be less like Athens and more like Sparta.

Peter Paying Paul (then repaying Peter)...

St Paul:  "Could I have that dollar you owe me?"
St Peter:  Of course..but can I borrow $2"

I wanted to take a moment to explain as clearly as possible why the world is in such trouble financially, and do so in a way that doesn't involve background knowledge in finance or many confusing statistics.

The world is economically in bad straits because we are all nations of borrowers. Every nation.  No one has any surplus and yet, we are borrowing from each other. We borrow from banks too but that's a dupe.  Most banks globally are zombie, meaning they're so much in the red that without money being poured into their coffers from nations, they couldn't survive.   Funny isn't it.. nations give banks free money so they won't collapse, then borrow it back at interest or lend to other nations that can't ever repay even the interest.

 And if not for all this and pretend currency created on paper and pretend monetary value placed upon it, the global financial community would have destroyed civilization 3 decades ago.

The reason I pinpoint it to the 1980s because most people do not realize this but in 1983, the Dow hit 1,000 for the first time.  Wall St had been in existence since Revolutionary War days (1770s) and yet never reached 1000 until 1983.  And what is it today?  Just about 13,000.  Each thousand represents $1 trillion dollars so in simple math, in a span of only 24 years, $12 trillion of pretend wealth was created.

Washington: "I much prefer my statue face something more honorable..."

Let's follow the sovereign economic food chain..  Greece needs money.  So does the rest of the PIIGS nations. And Eastern Europe.  So they borrow from the rest of the EU.   Who puts up most of the funding to cover those losses?   Germany.  And what was Germany doing today?


Merkel Looking for Help During Visit to China (Spiegel) -- "German Chancellor Angela Merkel needs help... Germany wants China to make a concrete pledge to invest in the euro bailout fund"

So basically all of Europe are beggars in one form or another.

Now Greece gets its bailouts from a "troika"- the EU, the ECB and the IMF which is pretty much US run and financed though it always has a puppet European leader so it gives the appearance of being international.  So 17.4% of all IMF loans and bailouts around the world come from US taxpayers.

And is the US a creditor nation?  Goodness No!  lol.. Not for many years..  We owe others more than $15 trillion dollars.  And yet the US has the audacity and arrogance to lend to others as if we're in the black.   And who do we owe money to?  Many creditors but namely, the Chinese.

And how do the Chinese lend to everyone?  They're really in an economic housing asset bubble, much like the US was prior to 2007. They had their citizenry build lots n' lots of homes, namely to keep the populace busy.  Problem is, most of the populace can't afford to rent or buy the homes that were built, so they're empty.. just like in Nevada, Florida and Arizona.

But China controls its media even better than the US so details of how weak their economy is, hasn't been truly known yet.  So as a ruse of prosperity, they lend money they don't really have to the rest of the other debtor nations and dramatically devaluing their currency so they can make up the losses via trade policy.

Everyone owes everyone.  This is why Investors are treated like royalty and national economic policies around the world cater to their needs; why Everyone tries to soothe the markets.  The Rats are the only source of  fresh money left in the big game of ponzi.

In a biblical sense, you could easy say the global economies survive by borrowing from "Peter" to pay "Paul" and no nation has the guts to dare call anyone out to repay their full tab. Banks and nations are all grateful simply if debtors can meet their monthly payments

And that's the sad state of the world no one talks about.

The Road toward 21st Cent Global Sharecropping

Once upon a time, there was a land far far away in the world of dreams and "remember when..", where people, even if they weren't always happy, were able for the most part to have good lives financially and take care of their families.  In this magical place, one breadwinner was only needed to raise the average family of four in a level of comfort and the spouse could Choose to work rather than need to out of absolute necessity.

In fact, this distant world was such an amazing place that the sole breadwinner did not need to attend college and compile any form of student debt in order to secure well-paying work.  There were jobs a-plenty, creating wonderous products that all the world sought after due to the reputation of high quality workmanship.  And these workers received salaries that allowed them to pay their bills, go on vacations, have savings for the future, and never in a million years think of doing things like using credit cards to supplement income or taking out Insta-pay loans to cover between paychecks...

To me, its definitely "Once Upon a Time" because the American economic golden age of the 1950s and 60s was before my time.  But one does not have had to actually have lived over the last 50-60 years to know there's been a profound shift in the quality of life of the average worker.

According to CNN/Money, "Nearly one third of Americans who were raised in the middle class dropped down the economic ladder as adults -- and that's before the Great Recession hit... Pew's Economic Mobility Project looked at children born in the early- to mid-1960s and assessed their economic status roughly 40 years later.

"Being middle class in the parents' generation meant a household income of roughly $33,000 to $64,000 in 1979. But their children had to earn between $54,000 and $111,000 to maintain their relative standing in society in the mid-2000s. (These figures are adjusted for inflation.)...

"Long-term unemployment has devastated the ranks of the middle class, with many people losing their homes and forced to turn to food banks and government aid after they run through their savings. It takes nearly 41 weeks, on average, for the jobless to find new work. Also, the steep decline in home values has hurt many in the middle class.

Recovering from a huge drop in income is not easy, a separate Pew study found. Half of people who lost more than 25% of their income in 1994 had not recovered four years later. And a third did not regain their economic footing after 10 years..."

________

Some quick observations:

1)  Notice how no one talks about or encourages individual entrepreneurship.  You're only supposed to survive by working for others; by being fully dependent on the whim and will of corporations to hire you when its best for them and at the lowest possible wage they can get away with.. No one in media gives any encouragement or even refers to the possibility that starting up one's own business is as good or better an avenue for survival than to work for others.

2)  Like we wrote before, the average length of time to find a job is 41 weeks- that's over nine months.  A child could be conceived and fully delivered into the world before the average person can find work again,  and that's not even taking into consideration whether that job matches the previous job's pay scale and educational requirements.

3) The destruction of the middle class would have occurred 25 to 30 years ago if not for the widespread introduction of credit cards as a means to supplement the lost income.  Credit cards had been around  before the 80's but they had annual fees usually around $75 to $125, and some like AMEX required 100% pay back on the bill when the monthly statement arrived.    They were cards of privilege for the privileged.

Once legislation was passed in early 80's which forced uniformity of all states to have to accept the interest rates of a credit card company based on what the home state of the credit card allowed (usually Delaware or South Dakota), then credit cards were free to explode into the market place and eventually without annual fees. Then came the rewards points and cash advance/transfer checks.. on and on..

4)  Its going to be harder and harder for people to maintain middle class and especially so for young people to enter it.  It is a global playing field now and the ultimate goal of corporatilists  is an level economic playing field between east and west, so everyone's paid bare minimums and the vast majority of people working and living for no other purpose than to repay 'company store' debts.

Company stores were used, starting in the post Civil War reconstruction period to keep sharecroppers, mostly black ex-slaves and poor whites, forever enslaved to the land by providing all the farming equipment, seed, etc for "free" (loaned but never taking cash for said items) but then to be repaid at very high interest rates which the worker was forced to accept terms and sign contracts even if illiterate, or go elsewhere.  And if a sharecropper didn't work, he was arrested and would spend many many years in prison doing work detail for free on chain gangs.

Not much of a choice is it?