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We have recently heard about the German E. Coli outbreak, responsible for the sickness of more than 1,000 people (and more than a dozen deaths).
The Spanish cucumbers were the ones to blame (and the way this affair was handled, one could be led into thinking that Germany was declaring economic war to Spain – after all, the latter lost $290 Million/week in exports since the beginning of the outbreak). Of course the warning, against Spain’s produces, has been lifted notwithstanding the damage (both economic and diplomatic) has already been done.
What is more curious is that Spain is one of the nations that stands under surveillance for fear that it may fall into the same financial quagmire that Greece, Ireland and Portugal find themselves into.
It's nearly unbelievable that anyone would want to see Spain begging for a bailout because being this country Europe’s fourth economy, bailing it out would signify that the EU would have to disburse something like €440 billion. Can Europe afford it?
According to BBC; the European Financial Stability Facility is worth up to €440 billion (funded by members of the Eurozone) and the European Financial Stabilisation Mechanism is worth €37.5 billion (funded by a broader group of European nations, including the UK).
The plot started in 2010, when Greece no longer was able to get credit to pay its huge debt. Then a controversial term began to be reapplied - “PIGS” - to refer to a strategic target: Portugal, Italy, Greece and Spain.
There is one curious acronym - PIIGS – that includes Ireland, but I suspect this term was created to deflect our attention from the truth: Ireland is a test sample (since the Celtic nation serves as a term of comparison to PIGS).
Taking advantage of the political and budget crises of the mentioned countries, certain groups commenced a hysterical campaign, with the sole purpose of putting pressure on PIGS to lead them to borrow money to meet their obligations.
Greece immediately accepted a bailout; Portugal resisted but it ended up by giving in to the pressure and this year it finally accepted the expensive handout. Italy showed them the finger and now the main target is Spain.
The stench of jealousy and fear is filling the fraternity.
The Beauty (Paris) and the Beast (Germany) fear the might of Southern Europe. The PIGS have once ruled over the old continent’s intellect, politics, economy, art, science & technological findings; and (with a strong British alliance) it literally controlled the world. With their proclivity to invent, discover, conquer and toil imagine what they wouldn’t do in the 21st century.
Therefore, they needed to be stopped.
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Dissecting Society™ welcomes all sorts of comments, as we are strong advocates of freedom of speech; however, we reserve the right to delete Troll Activity; libellous and offensive comments (e.g. racist and anti-Semitic) plus those with excessive foul language. This blog does not view vulgarity as being protected by the right to free speech. Cheers
Max, sorry to play spoil sport, but if a family owes money it cannot repay for whatever reason, it has to either liquidate what assets it has, or borrow from someone else at terms dictated by the new lender, so that the old lenders are paid off. There are simply no other alternatives. The root cause of the economic woes of the countries in discussion, is profligate and illogical living beyond means. They can be innovative, inventive, and what else not, but to be able to achieve they will need to be solvent first. Corrective action does not amount to a blood bath.
ReplyDeleteI agree however that there was some shooting from the hip on cucumbers, but when human lives are involved, is it not better to over react first?
Max,
ReplyDeleteWe have to read the subliminal message behind the term "PIGS": marranos, Sepharadim.
The North of Europe is declaring war to Jews in South of Europe. Like you said, they took advantage of the political turmoil in the south to unbalance their economies, with the sole purpose to have the "PIGS" by their micro-economic and financial balls and show them who's in command.
tchau
Hello Max,
ReplyDeleteI adore a good conspiracy theory: well done!
If we look at PIGS we will see that, when the crisis began, they had socialist governments (with the exception of Italy - perhaps that is why it was temporarily left alone; because now that il Cavaliere is in danger [i.e. his party was thrashed in local election] Moody's is already considering downgrading Italy's credit rating; meaning that the chase is back on); therefore we could think that Europe (whose trend has been to turn Right) is in fact declaring war to the left.
By causing macro-economic problem in those countries, they forcibly cause social & political discontentment, that will result into the fall of lefty government (which could be viewed as the ultimate goal).
As for Ireland: it does seem to be the stress test, doesn't it? Whenever the success of PIGS is to be tested, Ireland is the place to start; if their failure is to be tested as well...Ireland seems to be there as a term of comparison. However, in this case, Greece was the first to fall and Ireland followed it; so what happened?
Anyway, the PIGS are about to turn into PIIGS (if Italy doesn't moon the plotters soon lol).
Before I leave: Ana Antunes' comment cracked me up ("have the PIGS by their micro-economic and financial balls"...how funny is that?); but you know what? The idea in it is not to be totally discarded...
See you next time!
Hi Rummy :D!
ReplyDelete"Max, sorry to play spoil sport,"
LOL please, by all means...do play :)...
"The root cause of the economic woes of the countries in discussion, is profligate and illogical living beyond means. They can be innovative, inventive, and what else not, but to be able to achieve they will need to be solvent first. Corrective action does not amount to a blood bath."
Things are more complex than that, I'm afraid.
I would agree 100% with you, if PIGS had the same crisis background; which they don't. Therefore their analysis has to be done on a country by country basis.
Let's begin by Greece - the problem with this nation is that it lied its way into the Eurozone and further lied to stay there (with the help of Goldman Sachs). Its accounts received a good dose of makeup and art, and by 2010 the bubble blew up in the air.
Ireland - it bailed-out its banks for €50bn (because they were in involved in Hedge Funds and prime rate businesses).
Portugal - excessive governmental expenditure (75% of national budget) as a result of a profound structural problem (the country needs to be re-programmed into believing that the private sector is the one that needs to create jobs, not the government. In turn, the government must create an appealing environment for the private sector so that jobs can be created). Yes, Portuguese families live beyond their means but the problem stems not there only (it doesn't even lie in exportations, which have risen by 20%) the root of the problem is mainly high government expenditure and low private investment (due to strict labour laws and high taxes).
Spain - it is not the first time that this country presents two-digit unemployment rates (which seldom reflect reality) and it has always survived. Spain is the fourth European economy, it is a huge exporter (if cucumbers generate €290 million/week, imagine how much they make with olives, olive oil, tomatoes, oranges, avocatos, ham, prosciutto, cheeses, wine, juices, saffron, etc etc etc), a huge producer with a fairly good fiscal policy. It has implemented an austerity plan (to control its deficit) and it has been able to sell its bonds...
I only know one thing: there are no coincidences. One fine day (in 2010), these countries began seeing their credit ratings downgraded and suddenly pressure was on them to borrow money at all costs. Clearly, this benefits someone...
"I agree however that there was some shooting from the hip on cucumbers, but when human lives are involved, is it not better to over react first?"
Over-reaction leads to mistakes; as it was the case.
Rummy, excellent comment for which I thank you a million times :D.
Cheers
Hi Ana :D!
ReplyDelete"We have to read the subliminal message behind the term "PIGS": marranos, Sepharadim."
I made that translation on "Etnias: O bisturí da sociedade". I also thought of that nuance...
"The North of Europe is declaring war to Jews in South of Europe. Like you said, they took advantage of the political turmoil in the south to unbalance their economies, with the sole purpose to have the "PIGS" by their micro-economic and financial balls and show them who's in command."
lol Ai, Ana...you kill me! Nevertheless, I must say that we should not discard that hypothesis.
Ana, my darling, I believe you are competing with me: your provoking comments are brutal lol!
Thank you so much for your direct input :D.
Cheers
Hi Celeste :D!
ReplyDelete"I adore a good conspiracy theory: well done!"
*Bowing* thank you...
"If we look at PIGS we will see that, when the crisis began, they had socialist governments (with the exception of Italy - perhaps that is why it was temporarily left alone; because now that il Cavaliere is in danger [i.e. his party was thrashed in local election] Moody's is already considering downgrading Italy's credit rating; meaning that the chase is back on); therefore we could think that Europe (whose trend has been to turn Right) is in fact declaring war to the left."
I was quite surprised by the news that Moody's is thinking about downgrading Italia's credit rating - specially because of the given reason (weakening support for the government may influence its ability to cut debt levels)...too thin an explanation, isn't it? So, it does make it look like some groups are after socialist PIGS. Let's see how things will play out for Portugal, now that a Right Wing government is in office.
"By causing macro-economic problem in those countries, they forcibly cause social & political discontentment, that will result into the fall of lefty government (which could be viewed as the ultimate goal)."
It is one way to do it, yes.
"Whenever the success of PIGS is to be tested, Ireland is the place to start; if their failure is to be tested as well...Ireland seems to be there as a term of comparison. However, in this case, Greece was the first to fall and Ireland followed it; so what happened?"
The Greek bubble blew up, with the compliments of Goldman Sachs; that's what happened. And I think Europe wasn't counting on that. They never thought that Greek was in bed with Goldman Sachs to hide its debt (from what I understood, GS gave the Hellenic nation something similar to a second mortgage, off the records, to give the impression of being wealthy while at the same time keeping itself within the EU's debt limits).
"Before I leave: Ana Antunes' comment cracked me up ("have the PIGS by their micro-economic and financial balls"...how funny is that?); but you know what? The idea in it is not to be totally discarded..."
LOL yes, Ana Antunes makes very unique comments, non c'è dubbio. I agree with you.
Celeste, such a marvellous comment: thank you so much! I hope to see more of you here (now that would be a treat) :D.
Cheers
Europe, more precisely the UE, is a complex animal. I tried to understand the main economical challenges and points of disagreement and boy, it's complicated! There are so many levels... each country has its way to deal with the economy and Brussel doesn't always approve. For example, France heavily subsidizes agriculture and I know it's a touchy issue at the European level.
ReplyDeleteYou can't have it both ways. Either we all work together to build the EU either we each play game against each other.
Max,
ReplyDelete"Let's see how things will play out for Portugal, now that a Right Wing government is in office."
We will see how things go after tomorrow (PM Passos Coelho is attending his first European Council meeting as the head of government). Portugal has a hard task ahead and I was glad to hear the President calling for the nation to sacrifice itself for the sake the future. Despite the hardship, the wind of change is encouraging people though (this week I heard our citizens calling for union, of all parties, to overcome the crisis...it's a beautiful thing to witness).
But if you look at the situation right now, you will see that all eyes are on Greece.
"(from what I understood, GS gave the Hellenic nation something similar to a second mortgage, off the records, to give the impression of being wealthy while at the same time keeping itself within the EU's debt limits)."
That is grave. What do you think the EU should do to countries that lie their way into the Eurozone?
Before I go, Max: in your response to Rummuser, you said that Ireland's banks had to be bailed-out due to their participation in Hedge Funds and prime rate businesses. What about the subprimes? Weren't these the principal cause of the financial bubble?
My dear Max!
ReplyDeleteIf you look very carefully, you will discover that the European Continent is plunged into financial trouble. The difference is that some countries have a certain amount of protection filed by political conspiracy in the European Union Parliament.
It´s my point of view!
Envy and beauty, never leave us. Why human beings are fragile and deludes themself with a life that will not last forever!
But it is very difficult to impress upon the head of public men a harsh reality: the time will pass, too, for them.
Have a nice day, Max.
I was WORKING ABROAD...as always...
Hi Zhu :D!
ReplyDelete"Europe, more precisely the UE, is a complex animal. I tried to understand the main economical challenges and points of disagreement and boy, it's complicated!"
True. It is indeed a rather complex web...I am still studying it myself. It's easier to understand the US political system, right?
"There are so many levels... each country has its way to deal with the economy and Brussel doesn't always approve. For example, France heavily subsidizes agriculture and I know it's a touchy issue at the European level."
France opened a precedent that ruined other EU's agricultural plan. Just to think that the EU (led by France, most certainly to benefit itself) controls what certain nations plant or do not plant...it's an absurd.
"You can't have it both ways. Either we all work together to build the EU either we each play game against each other."
True.
Zhu, marvellous input: thank you ever so much :D.
Cheers
Celeste,
ReplyDelete"We will see how things go after tomorrow (PM Passos Coelho is attending his first European Council meeting as the head of government)."
I am going to read the report on that today (the conclusions drawn at the summit).
"Portugal has a hard task ahead and I was glad to hear the President calling for the nation to sacrifice itself for the sake the future. Despite the hardship, the wind of change is encouraging people though (this week I heard our citizens calling for union, of all parties, to overcome the crisis...it's a beautiful thing to witness). But if you look at the situation right now, you will see that all eyes are on Greece."
Yes, it is quite a change indeed - I was even surprised (and proud).
Oh yes, all eyes are upon Greece and the hysteria continues...the web is much more intricate; and the more I read the more I find the whole affair fishy...something is off (I am yet to put my finger on the wound, but I will get there).
"What do you think the EU should do to countries that lie their way into the Eurozone?"
That is one tough question. I think that they should be heavily penalised; but the question is to know how. Booting Greece at this moment could be disasterous for the single currency, but I know one thing: Greece is not protected by the article 122 of the EU Treaty...
"Before I go, Max: in your response to Rummuser, you said that Ireland's banks had to be bailed-out due to their participation in Hedge Funds and prime rate businesses. What about the subprimes? Weren't these the principal cause of the financial bubble?"
Indeed, the subprimes had a major role in the financial bubble (until today I nod at the lack of ethics displayed by most financial institutions); but in the Greek case I believe it was the prime rates that did it.
It was a combo of misdeeds, Celeste.
Hi Grace :D!
ReplyDelete"If you look very carefully, you will discover that the European Continent is plunged into financial trouble. The difference is that some countries have a certain amount of protection filed by political conspiracy in the European Union Parliament. It´s my point of view!"
You know what? Your viewpoint complements the theory presented in this article, very well.
"Envy and beauty, never leave us. Why human beings are fragile and deludes themself with a life that will not last forever!"
True.
"But it is very difficult to impress upon the head of public men a harsh reality: the time will pass, too, for them."
A wise and true conclusion...
Grace, welcome back (from abroad) and thank you so much for your wonderful input :D.
Cheers
I know little about current EU problems, but having sat down last night to research it, I came across one interesting titbit: allegedly those in Greece pay little to no tax. Is it any wonder they're heading for bankruptcy.
ReplyDeleteBy the looks of things the EU, while a good concept, has ended up being a pig of an idea, especially for those who have to do the bailing out.
Take Care,
Peter
Hi Peter :D!
ReplyDelete"(..) allegedly those in Greece pay little to no tax. Is it any wonder they're heading for bankruptcy."
It is true: tax evasion is perceived as a normal thing in Greece; how shocking is that? The nation that taught us about democracy reveals some irresponsible & anti-democratic demeanour.
"By the looks of things the EU, while a good concept, has ended up being a pig of an idea, especially for those who have to do the bailing out."
"pig of an idea" LOL LOL nice! Things have been ill-planned. I am still studying how the EU operates, but if I were up there I would suggest that eurozone members would contribute a percentage of its GDP to some sort of Eurozone Trust Fund to be used in cases such as this. That way they'd have a cushion in times of crisis without having to directly resort to bailouts...
Peter, you were missed! Thank you so much for your awesome comment :D.
Cheers