Greece and Germany

Angela’s Athens

Germany’s chancellor makes a trip to signal her country’s goodwill

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Milovan Djilas - "I have a question for the gang - Forlana"

No need stupid questioning Djilas tovaritsch !!
Forlana joining anything with “eu” at start for fat subsidiarinojsk !!

This korrekt dialektik !!



I have a question for the gang - Josh, Forlana, Lavyrity, Pedro, Pumpy, Viva, Marie, Sanmartinian et al.:

1) I have argued for months that the bond yields bear little relation to economic fundamentals; I stand by that statement.

2) I have argued for three years that Italy's economic fundamentals were strong and not weakening.
As of last month, that is no longer necessarily true. The government has admitted for the first time that our fundamentals - recession and umemployment especially (but homelessness and hunger might also be set to explode) have weakened substantially.

SO: Why is it that Italian bond yields on the secondary market are dropping like a rock? After bumping up towards a scary 500 basis points Italian ten-year bond yields have fallen to around 350bp. Today, they dropped 25bp in a single day- and closed the day at 313bp over German bunds.

Obviously, someone is buying up our bonds. To a certain extent, this might be the Italian Treasury, given that we should have a healthy federal budget surplus, as usual, in the last quarter of the year.

But, I admit I am stumped. And annoyed. Once again, these dam yields have no relation to economic fundamentals. Why they should be dropping now, just as the fundamentals in the peninsula are beginning to look scary for the average citizen, and just when the government admits the original deficit and debt targets will not be met by the end of the year, is totally beyond me.

Any theories?

Josh_US Lux in reply to MilovanDjilas

The sovereign bond markets are indeed among of the least transparent and most manipulated financial markets there are.

The manipulators are mainly public actors, such as - in the case of Italian Btp bonds - the Italian government and the ECB.

Judging by what I've read on the topic, private investors play only a marginal role at present - so the yields you see are essentially the ones the Italian government wants to have.

The one thing I've learned during this crisis is to never get near sovereign bonds as a private investor again.

Josh_US Lux in reply to MilovanDjilas

Moody's now rates Monte dei Paschi, Italy's and the world's oldest bank, and twice recapitalized during the past 3 yrs, as "junk".

What's your take on that?

Haven't you told us Italy's banks were rock solid? Moody's seems to disagree.

MilovanDjilas in reply to Josh_US Lux

MPS is the only Italian bank that may be described as "struggling". But Moody's exaggerates and the bank is being penalised as an Italian institution by the hammering all our firms' reputations are taking (unjustly).

1) Recapitalisation - let's not exaggerate: at no time was the institution threatened with bankruptcy. MPS has 19 billion in equity - and accepted 2 billion in lent capital from the Italian Treasury 2 years ago, plus another 2 billion in June of this year. Without those government lent monies they would have 15 billion in equity - below the 9% core capital threshold the EBA has demanded for European banks but, at around 7%, a long distance from bankruptcy.

2) Losses of 5 billion last year and 1.5 billion in the first half of this year were mostly provoked by write-downs of Goodwill - not operating losses. Although the EBA directed the bank to write down over 50% of its (somewhat excessive) Goodwill last year (while the announced decision to write down close to another 2 billion took the market by surprise a few months ago) - these write-downs were still largely voluntary, in the sense that they were not required by law.
So the losses represent great Prudence.
The bank is under control, not out of control.

3) The bank has a credible industrial plan to boost equity internally. It has put up for sale, among other things, 400 branches here in the Venetian northeast.
We are one of Europe's richest regions - while unemployment in Friuli is currently at 6%, for example. So the branches for sale are in good markets - but the timing of this sale will probably be long (1-2 years) given general market disruption (read: the liquidity crisis). No banks are buying or even lending at the moment. In my area, the banks are only offering mortgages up to 50% of assessed value at the moment. This is a temporary situation and cannot last (otherwise there will be much bigger problems and Italy will exit the Euro in disgust, but not in poverty.)

4. Although the bank is "struggling", it is not really at risk - the owner is: Monti dei Paschi di Siena Foundation. They have borrowed money from other banks to recaptalise MPS and not lose control of the bank. The losses mean the Foundation cannot easily pay its interest expense. Since the Foundation has distributed dividends of close to a billion euros per year around the town (pop. 50,000) and province of Siena, and can no longer do so, there are quite brutal consequences for the local economy that come back to the bank's balance sheet in the form of rising non-performing assets). Once again, everyone is hoping in Siena this dynamic is temporary.

5) Don't worry. Siena is like everywhere else in Italy. The Foundation is hiding a lot of net worth just in its art and architectural holdings alone.
Click on the different rooms and take a look at the art held just inside the Foundation headquarters. Nowhere here are they showing us what works of art are in the vaults.

6) Moody's does not have the qualified personnel to evaluate the Italian context - they are limiting themselves to superficial readings of financial journalism.

7) In order to stop being a "struggling institution" the Foundation would have "to let go": either open up a share offering that would dilute its control, or sell some historic buildings, or sell some historic works of art. At the moment, they are willing to do none of that.

8) Of course, an artificial problem are the 26 billion of Italian government bonds the bank owns. MPS is being hammered by secondary market spreads of 450 bp just one month ago. But these are now dropping like a rock (currently at 312 bp).

emmafinney in reply to MilovanDjilas

Why do you want to know?

When has the truth ever being important to you?

You don't want the truth anyway, all you want is conspiracy theories to maliciously scapegoat USA/UK for Italy's problems.

Just go on telling your malicious lies about the USA or Britain to scapegoat them for Italy's problems and give yourself a medal for it.

After all it is not your fault if you come from a malicious scapegoating culture.

Complaints department

Greece's problems are afew too many unfortunately.. Greece's politicians are to blame..Not the Germans..They should actually be thanked in this case..
Greece has been spending more than what has been coming and it was only a matter of time of when not if it was going to blow up..and they still blame others..That is the sad part..
They need to set the minimum wage at $250 to $300 euros yes taht is right..All politicians to take a cut in pay of 50%...Introduce a company tax rate of 10%..People who strike cannot block roads, rail,ferries or air travel..Yes that is right they need guaranteed open airports..
Tax collection to happen and enforced and law changes to reflect this..People have to pay taxes when they fall due..not when they feel like it..and it needs to be remitted to the tax office..
Strange as it may sound but unless the above happen nothing will change..
Greece needs a centralised licensing scheme, one professional body for all of Greece for solicitors,chemists, doctors and accountants..
And they all have to be audited and issue invoices..and receipts..

Terence Hale

Angela’s Athens. “I am the master of my 'fat'”. It was amusing to watch the TV coverage of the meeting Fr Merkel and Mr Samaras. Sitting both down in arm chairs of low posture giving a gold fish in a bowl impression, Mr Samaras said in English, ”this is my office”. The look from Fr Merkel, “can you afford it?” replied “O’yes”. The unfair demonstration was counterproductive for the Greeks with the Euro land press expressing amazement with one German newspaper giving en example a Greek farmer on an income of around 600 € per month transferring 12 million € to a foreign bank. The German finance minister Hr Schaeuble seems to be the power propping up the Greeks in the euro with his visions of a greater Europe; which history has heard before. Such stubbornness to keep Greece in the euro will be its “coffin nail”.


Austerity in Greece will only manage to bring GD in power,i had a talk with a friend today who is an expert in modern history, he told me that GD's mp's will most probably step down during the voting of the new austerity laws, that will earn them great popularity and it will also trigger elections to the areas that voted for them,if more mps step down from other parties and the number reaches 80 or more, we will have national elections, it happened in 92 and ND lost from PASOK,some of you may not believe me,but in the next years fachists will become opposition or even Government.
For the sceptical ones i will tell this,just check your history books on how Hitler got to be Chancelor in september 1930.
Thank you E.U for turning my country poor and faschist, and Angie next time you visit watch out for the minefields.

South American in reply to mr_Arcadian

Don't lose hope. Samaras is doing a good job. I fear without the pressure of the euro the political class in Greece will never change. Support Samaras! The banks have already cancelled 100 billion euros, the euro-countries will continue to support.

mr_Arcadian in reply to South American

Samaras is not doing a good job, he just renames good assets of the state to bad so he can sell them to his friends cheap, there is not a better example than Atebank, a profitable institution that was sold for 94 million!,only the real estate the bank has is calculated in billions, i have no objection to selling property, but not at that prices,we will never recover if we have a firesale!,whats next?,the electicity company?, didnt ENERGON taught them anything?,or is it that they want to lead people to suicide?, no i wont support Samaras either,he is part of the system that brought as here in the first place, he is not called "komanetsis" with out a reason.


CNBC reports today that the Swiss army is holding a practice mobilization for the purpose of determining how fast the Swiss army can respond to warring factions and tides of refugees in surrounding nations.

Well done, EU! Thanks for creating and preserving the peace that NATO had nothing to do with. And congratulations to the Nobel committee for spotting such excellent work!

Epsilon the Great

Wrong impressions- wrong policies. I am a fanatic supporter of Free economy. I knew and i still believe that my state, The Greek state , is one of the worst managed states in Europe.In the begining of the Greek economical crisis 3 years ago , i was supporting the intervansion of IMF and the EU in the internal Greek economics.I was feeling that this was a big oportunity for my country to be modernized in economical structure and be a well organized European state.I was even supporting the "Troikas" requirements, which were affecting my own interests. -I had in mind the future of my childs in well governed state.However , recently, and taking into account that "troika's" insistance on certain measures (not all) which clearly guide my country to a third world status , i started to feel that a country-any country- can not be governed by technocrats alone.Politicians have their own role.Greece during the last 3 years trying to follow the IMF and EU technocrats policy. The result looks to be very bad not only for Greeks "but also for the technocrats leaders interests". A society have always a limit before the reaction.Technocrats guided the population of Greece-even educated people-in its limits.International lenders have only two options.Either to give to Greece the oportunity and possibility of develompent (alongwith of course of puplic sector restructuring) or they are going to loose all their money.What Greece will do in such a case? Simple- population will rebel and government will oblidge to give a soloution.What solution this can be? Out of EU -Out of NATO and 10 naval bases to Russians in Aegean sea (Islands).Particularly in these islands which inhabident of less than 150 people!!!I am suggesting that in future cases IMF and other economical centers employ (TROIKAS stuff) basis they have both degrees -economical and states government affairs dimplomas.

Greece needs time and the lenders should cancel more debt. I would support Samaras, he is doing a good job, and I would wish, that the basic of the social state in Greece will be maintained. We all see how the Greek people is becoming increasingly radicalized. Are there a reform-minded press? I've heard that even if Greece would be debt free now, after a year had accumulated many debts again. The change takes time and more empathy from the other euro countries. Greece is in the euro, we must solve the problem together.


I have no idea but but why does IMF is all round the band on everything that is not the concern of IMF. Put simply we have leaders to take care of the country's economy they have the sole duty to see that their state rund in the best manner but butting IMF keeps on coming telling how to do this is not practical Will they tell China or India how to run the economy? Will India and China listen? I thank you Firozali A.Mulla DBA


Hi Josh - for what it's worth, I did not ask the moderators to remove your comment. I was preparing a response when it got deleted.

Donadio writes one or two misleading things.

1) I don't care if Italy accepted 60 billion of European money from 2001-2011 - we paid double that amount-: so the money spent or wasted in the South was ours.

2) No, it is not true most of the 60 billion was headed to the South. Most monies may have been earmarked, but not spent. Actual monies spent are about equal among our regions.

3) No, Donadio makes it sound as if 60 billion dollars were spent and only the highway is to show. Instead, the article goes on to explain that 500 million of EU money was spent - and the EU is requesting reimbursement.

4) There are probably good reasons, beyond corruption, why the motorway is not finished for 40 years - as in, basic engineering mistakes were made and the motorway CANNOT be finished.

5) You will note that, unlike Catalonia, there is no particular budget emergency in Calabria - the central Court of Accounts keeps a tight leash on local spending.

6) If I, as a northerner, take an interest in defeating the N'Drangheta or reforming Calabria, I am derided as a carpet-bagger or worse. Defeating corruption is their business down south, not mine. Until then, I am not particularly bothered if they do not manage to spend potential EU money or develop their region economically.
In the meantime, Berlusconi was supported by Church, State and Industry for almost 18 years. This is what they have produced. I have been with the Leftists over this period. Let's see who wins the new elections.

In 2001, Silvio Berlusconi won 61 out of 61 electoral districts in Sicily during parliamentary elections. Obviously the Mafia had swung their support behind him. If Sicily was an independent country, we would never have had Berlusconi and would not have these problems today.

leaveittoviva in reply to MilovanDjilas

You must stop these dangerous secessionist utterances. We are all too used to speaking of the 'Italian boot' to have you go on that way. What would happen if, as you wish, the North went its own way? Why, we would then have the Italian sandal and perhaps a garter. Totally unacceptable!

MilovanDjilas in reply to la.výritý

Angie provided political support in the European Parliament when the Left produced motions to condemn his undemocratic domination of the TV stations and many local newspapers and radios.

Berlusconi owns three national stations and when he was Prime Minister commanded the other three national stations. Put that together with large investments in magazines, newspapers and radio stations, and his ability to sway public opinion, to set the terms of the national debate, had very little to do with a democratic country.
For example, the Parliament passed an "Equal Time" law in the early 90's during election seasons: Berlusconi simply had his employees and political appointees transmit coverage of the Opposition after midnight, while he was always on prime time - and not sound-bites but 2-3 minutes at a time.
Then, whatever time was allocated to the Right was 80% dominated by Berlusconi - whereas his men would divide the time slots dedicated to the Left Opposition among nine leaders (the Nine Little Dwarfs). The tricks were endless... and when this was brought to the attention of the European Parliament, seeking an external authority to condemn the practises, Merkel ordered her MP's to support Berlusconi's cause.

Notwithstanding these tricks, the Opposition won (by a hair) twice - in 1996 and 2006. (Silvio later found a few deputies to defect in exchange for "favors").

And yet, despite everything, and the suicide of the Centre-Left at the time ("Let's pretend we are American Democrats - and not European Socialists") Berlusconi only won 37% of the vote at last elections: his coalition allies another 5%. The vagaries of an electoral law he wrote in 2003 translated this into a 60% majority in parliament.

I have never seen you criticise these events.

Tell the truth - your money is as ill-got as Silvio's. You certainly did not earn it with all the time you spend blogging here. And you admire Silvio, don't you? Nice to be able to get rich, run roughshod over judges and never pay taxes, eh? And then get elected Prime Minister thanks to Vatican support...

At no time over the last 20 years did the majority of Italians ever vote for Silvio's party. Nor did his various coalitions ever have majority. Vatican tactics manifested behind the scenes helped to make sure the Opposition was always splintered.


At this point, it seems that Greece is in such a shithole due to the level of austerity needed that a partial default is necessary.

Here is my proposal: restructure all debt over 80% of GDP: given the small size of Greece's economy relative to the Eurozone, this is bearable and more efficient than endless bailouts that won't be paid back. To avoid financial contagion, the ECB should stand ready to allow banks breathing room and help construct firewalls.

Allow the Greeks to borrow cheaply from the ECB (at AAA levels) provided they AGGRESSIVELY pursue long-term structural reforms and crack down on tax evasion and follow short-term STIMULUS in infrastructure and other EFFICIENT spending coupled with MEDIUM-TERM MODERATE austerity through cutting the bloated public sector and undergoing some privatization.

Should the Greeks suddenly refuse to do anything, "unforgive" the debt held by the ECB and IMF and withdraw all external support until they relent. If this goes on for over two months, kick them out of the Euro!

If the Greeks were faced with choosing between a HUGE carrot or a HUGE stick, hopefully they'll follow common sense...

la.výritý in reply to Disillusioned

". . . restructure all debt over 80% of GDP".

This, then, must be done by the public pension system in Greece, which holds state bonds and provides generous public pension pillar, plus other voluntary occupational and private pension plans based on Greek sovereign bonds.

"Allow the Greeks to borrow cheaply from the ECB (at AAA levels)" . . . why only the Greeks?? ... and not the Slovenians, the Irish, the Italians, Spanish, Portuguese, Slovaks, Maltese, Cypriots . . . etc. etc.


If they had done all that, then they wouldn't be in this mess in the first place.

Konrad Walter

Greece could learn a lot from the Germans. The problem is, if they want to learn from the Germans and do not consider it as a sort of modern colonialism.


I see a lot of accusing at the irresposability of the Greek leaders but also corrupt Greek people. Yet nobody wants to assume resposability for lending those amounts to the Greeks.

I'd like to state that I think both parts are responsible:Greeks first but also the lenders.

In a response South American says:

" Since in all these cases the representatives of borrowing countries were adults and usually well educated financial experts, they are primarily responsible for their deeds.

For both, borrowing beyond means and borrowing from hundreds of different sources (to hide prodigality) the prodigal borrower is to be held accountable, not the hundreds of different creditors who often don't even know the whole picture (as it was in the case of Greece or concerning the situation of the Spanish banks). "

Well according to statistics published by BIS, in June 2011, German lenders were the biggest foreign owners of Greek government bonds with $22.7 billion in holdings in 2010. French banks, trailed their German peers on sovereign debt with $15 billion. We only talk Greek government bonds owned by German and French Banks.

More to it according to Businessweek:

" At the end of 2010, Greek government bonds held by banks in countries reporting to the BIS totaled $54.2 billion, of which 96 percent was owned by European lenders. Germany and France, which accounted for 69 percent..."

These are not so many, unknown lenders. Were in fact some of the biggest German and French banks, therefore is very hard for me to believe that those institutions did not know what was going on in Greece.

In short I think is time everybody assumes responsibility for what happened: Greece for all the corruption and tax evasion that it goes on and the lenders for lending carelessly. IMHO letting Greece enter a controlled default would be the best solution. Should have been done two-three years ago. Investors and lenders assumed risks. They lost and if that is the case go bankrupt. No more bailing out banks by transferring the burden to the tax payers.

South American in reply to lion14

Hi Lion, the quote: "Since in all these cases the representatives of borrowing countries were adults and usually well educated financial experts, they are primarily responsible for their deeds" is not mine. But I do agree. Also with the other part. The German, French, Luxembourg and Spanish banks (15%) are equally responsible. I understand that the banks have already cancelled Greece 100 billion euros. I would not mind if banks remain sitting on their loans. Why the simple taxpayer?

Josh_US Lux


Published: New York Times, October 7, 2012


Nothing embodies the failures of the Italian state more neatly than the highway from Salerno to Reggio Calabria. [...]

The highway is also a symbol of what some Northern European countries say they fear the most about the euro zone: its development into a welfare system in which they are expected to support a sluggish Southern Europe, where grants and subsidies too often vanish in graft that the governments appear unable — or unwilling — to prevent. And it helps illustrate how the financing has yielded relatively little of the productive investment that might now be helping Southern Europe as it tries to climb out of an economic ditch. [...]

From 2000 to 2011, Italy received more than $60 billion in European Union financing to underwrite a wide array of programs, in areas including agriculture and infrastructure, most of it directed to the south, with little but a half-completed highway to show for it. Spain, which was given a little more than $100 billion, at least built a world-class high-speed rail network. (Greece received $50 billion, an enormous amount in per capita terms, also to unclear effect.)"

Wilhelm Röpke

Carefully operating media founded people who spoke clear on this issue. Some were glad that Ms Merkel visited Greece even under these circumstances. To protest on the streets is one thing, making such abuses is another. There are no justifications for what some parts of the Greek society show openly. I am glad that some Greeks do not agree with those trouble makers.
However, there are many who behave fully out of order and a much bigger majority of "nothing-sayers" are calm which mean they tolerate those unacceptable attitudes.
All lenders today pay for the Greeks because those on the streets are fully responsible for the situation their country is in today. They are responsible for cheating and therefore not paying any taxes. They are responsible for that Greece has no files which show who owns what land. They are responsible that the rich Greeks - not the Germans - have transferred their money to anywhere in the world. They are responsible for fully ineffectively working tax authorities - if there are any. The point of irony is that
Germany offered Greece help in all areas necessary to levy taxes, however, overproud Greece simply rejected any help. That is a point Germans started to wonder for what reasons do we help arrogant people and let us blame for helping?
For a country unable to do anything and has been on a drip for many years and it will for further many years its attitudes that are not understandable at all. I think the Greeks should first of all get clear with themselves. The anger they show to others they should show it themselves since the mirror image is the real enemy.
I do not understand why Greece intended to join the euro. All reforms they do
will not help Greece to get back on track. All these will take many many years.
Greece has just the wrong currency but the Greek politicians knew that as they joined the euro. And they know what happens to a country that is unable to follow the rules of a single currency. However, today they seem to have forgotten their knowledge. Where has it gone - simply disappeared?
My sympathy tends to zero when it comes to Greece. It was all known before but Greece did not listen and ignored anything. In order to make the situations not even worser
Angela Merkel's visit was good.

Wilhelm. If you are a German, then you should slowly get used to it, that some bad behavior towards Germans is allowed, which is not allowed towards other people. The Jews have also wondered why they are persecuted, what have they done? Like a Rabby from the U.S. said: "The Germans have become like the Jews a 'symbolic people', only that the Germans do not realize it." Funny irony, is not it? Joking aside. Many U.S. presidents make always the same experience as Merkel, although Germany is a small country.

guest-iijmljn in reply to Wilhelm Röpke

Wilhelm, I hear a lot about those few idiots who paraded wearing nazi costumes in Athens, but at the same time there is deafening silence about the insults towards the Greeks (and other southern Europeans) printed on German newspapers on a daily basis. Some of those insults are borderline racism and dangerously resemble the rhetoric used in times that we are trying to put behind us. Have you read the Bild lately? Just saying..

Wilhelm Röpke in reply to guest-iijmljn

Well. We should be clear on that point. I have not read anything that brings history from 60 years ago. I wonder what is if you picture a democratically elected state of head as Adolf Hitler? What we see in the media about Greece is that protesters, trouble makers, wear Nazi uniforms and speak about 4 Reich and link Mrs Merkel with Adolf Hitler. Should you say that is your way of have free speech - I am sure that in German news no Greek is blames as mass murder, dictator...
Germans did not even declared war to Greece, did we. There is a huge difference between saying you are lazy or betrayer or you are a Nazi, mass murder.....

I would urge you just to think twice. There is NO justifications for any blames that link Adolf Hitler and Mrs Merkel nor anything that back allegations that Germany plans a 4. Reich. If public servants wore Nazi uniforms some days ago, and they did, you should better rethink what kind of people are Greeks. I would have NO understanding for that at all if I were Greek nor do I have understanding for that as a German.

You should make clear that the protestors do not represent Greece's majority. Should Greeks in majority oppose Germany and do not want, therefore, being helped, please let us know. There are many countries in the word which are more deserving help than Greece does since it does not deserve help. Germans would have spent their money for schools in Germany rather than for riffraff on Greeks' streets who wore Nazi uniforms.

Greeks should be clear on that for 100%.

However, receiving money and insulting is not acceptable. Should Greeks be too proud to accept terms get yourself out of the mess. If I were Greek I would not found any reason to be proud of. The generations after WWII achieved nothing at all. Insofar Greece has kept the standard of a third world country, hasn't it.

No, I do not get used to nor do I intend to. The media in Greece covers the whole story quite simple. So it is much easier to say the troika - leading by Merkel -
is squeezing Greece out.
The media does not cover the story correctly. It were Greeks who squeezed the country out. And today the rich and the not so rich Greeks prefer to flee outside the Greece with all their wealth and let their fellow countrymen down. Where are all those rich people and where is all that money? Why do they not help their countrymen?
NO word in the media about those betrayers. However the media fully informs (lies) about Mrs Merkel who intends to rule Greece?! No self reflections but all eyes on Germany for it is easier to allege Germans as Nazi than oneself for being an idiot. And for me, it turns more and more out that Greeks do not deserve any help and I prefer helping some African children since I know they actually need our help.
All these refers to false and misleading information provided by Greek politicians and Greek media. All of them fully responsible for the mess and the anti German atmosphere.

robertoduran in reply to Wilhelm Röpke

While the nazi uniform protesters are stupid and we agree on that I find that you are very lenient on the German press and commentators. Your country in the past destroyed Europe (greece included) based on the ideology of 'lesser races' and now all we hear from Germany is about 'lazy greeks' and 'corrupt southerners'. I would expect that after your dark past you would have learnt to avoid stereotypes and generalisations bordering racism. Not even t34's rolling in Berlin driven by untermench slavs taught you anything? You are not better or worse than anybody else,

emmafinney in reply to Wilhelm Röpke

However you keep defeaningly silent about the fact that in Germany comparing American presidents to Hitler is OK.

Every American president from Reagan to Bush was compared to Hitler in German street protest signs.

Germans didn't seem to mind it when German protesters compare American presidents to Hitler, they were indifferent or found it amusing. Reagan was bashed as war mongering Hilter by the German left for standing up to the Soviets.

Now Germans are getting a doze of their own medicine and as usual they don't like it one bit.

emmafinney in reply to Wilhelm Röpke

"I wonder what is if you picture a democratically elected state of head as Adolf Hitler."

Indeed you must tell us what it means when democratically elected American presidents are pictured as Hitler in German protests?

Wilhelm Röpke in reply to robertoduran

The most Germans have valued the Greeks and providing helps was no question of if, however, rather of how. Do you know why? It was expected that Greeks were smart and well educated.

Something that would enable them, and you, to distinguish history between 60 years and 20 years ago. There are differences between being "lazy" or "less productive" and allege someone being a dictator or planning to annex a country.

Making this story short. You achieved a level I am unwilling to debate at.
Referring to Germany's history I can remember in history that many Greeks slaughtered, murdered, enslaved and exploited the ancient world. Do not believe,
because it were Greeks, their forefathers murdered for any better reasons.

Wilhelm Röpke in reply to emmafinney

Funny for a Canadian. I saw more pics of that sort in the US, especially on rallies
organized from Reps.

Paul Broun seems to be an expert in how dictators are "elected" as he referred to Obama's candidacy for president in 2008. Very smart by the way. Another pic is from protesters against Obamacare. Hey I am very sorry but I cannot take American media and many of the Reps seriously. Would it not be that stupid it might be a joke, however, it is not.

Well, should some German protesters pictured W. Bush in that inappropriate way - I can feel them, sorry.

Hey, I appreciate that you are in your terrain.

robertoduran in reply to Wilhelm Röpke

And you should be able to distinguish between a number of protesters (few) and the German mainstream press. In any country at a given time there can be a few that share some 'strange' ideas. But when you see the main papers advancing stereotypes you have to be worried.

So you don't want to debate more that's fine, but keep in mind that when you accuse others you'll get accused back be it in forums or in everyday life. If you can't stand the heat measure your words.

I won't get in historical comparisons since I don't believe in common responsibilities. A modern day German has nothing to do with the Nazis, I definitely don't think it's right to accuse Germans in the 40's 'en masse'. At least I am consistent.

By the way I don't know what they teach you in schools but what Nazis did is unprecedented in human history. Neither Huns, nor Timur Leng have reached their level. (at the end i didn't manage to avoid some comparisons)

South American in reply to Wilhelm Röpke

Many of the survivors of the German massacre are still alive. Their families remember, as well as the families of the Greek Jews deported. Compared with the conquests of Alexander the Great, it is still fresh. Today's Germans are not to blame, but responsibility must be taken. This implies to be more sensitive, especially when it comes to neighbors or people who have suffered from Germany in the past. You may want to have anything to do with it, but that makes it even more difficult.

South American in reply to Wilhelm Röpke

You may want to have anything to do with it, but that makes it even more difficult. It's funny, but the German Jews have said something similar. "The Nazis have reminded us that we are Jews. We had forgotten it." Even if the individual does not want to, he can be subsumed under something. So it must be accepted that the Germans are a kind of "symbolic people." "Nasty Germans" and so on. A "little symbolic", take it not so tragic.

emmafinney in reply to Wilhelm Röpke

Well the difference is Americans nor Canadians are whining about their leaders pictured as Hitler in foreign countries.

However Germans like you are making a big deal out of Merkel pictured as Hitler in Greek street protests and even make pompous remarks like


So there seems to be a double standard in Germany. Ok for Germans to portray American leaders as Hitler but foreigners cannot portray German leader as Hitler.

Wilhelm Röpke in reply to South American

It is not - but if I would like to talk about history I would access a history board. That is all. But you are in some ways right. It all comes very quickly to that very point: WW II. So the Germans are always the bad guys. If they help or not.

So, no questions where are the responsible in Greece? Greece would have been able to manage the crises if there had been something like a political system. With the euro Greece is unable to survive on its own. That was known (by all Greeks) as Greece joined the euro. Today they blame Mrs Merkel for their decision. If it does not work, try WW II. This trick has been used so often. I am going to be sick on that. It is hypocritical.

Wilhelm Röpke in reply to robertoduran

You maybe read my first statement twice. I wrote about few who were in favour of Merkel's visit. But I cannot believe that the riots in the streets are views of some fews and the overwhelming majority do not back them. That is what I worry about. Spoken in clear words: Ignorance and stupidness in broad parts of Greece's society.
Moreover, I read many about the single currency and its effects on economies that cannot keep pace in books of economics. I watched some documentaries about Greece and the effects this crisis has on people. Well sad but true. Economics teaches what can be done in countries in order to get back on track. All means are a disaster. The question is: why does Greece just massacre its middle and under class? It is not Mrs Merkel who told Greece to enable the super rich getting their money out of Greece. Nor is it Germany's fault that Greece in unable to levy taxes needed.
Greeks can criticize many things. But it can be done in a way that is appropriate.
No, I do not tolerate far fetched comparisons. Insofar I do not get along with anything. There is, historically, no link between the crises today and WW II 60 years ago. People who emphasise it (WW II) just look for false excuses under which they can blackmail more money.
The core of the Greece's crisis laid in Greece and in Greece lays the solutions for it.
Finally, WW II is present in Germany's daily life - for sure.
However, this crisis and its solution have nothing in common with Nazi Germany.
Referring to it is just an outlet for frustration.

Wilhelm Röpke in reply to emmafinney

No, Germans are used to be seen as Nazi. But with view of this crises
the intensity has turned into a new quality. The point in Greece is it were public servants who wore Nazi uniforms. Actually nobody believed Greece is able to manage joining the euro. But they insisted on it. Every economist who is able to think must have known that - for sure. And Greece's elites were in fully knowledge about all consequences their fellow countrymen will suffer.

Although they decided to join, they profited and transferred their gained money off Greece. Under these aspects it is better blaming a third party and draw the attention far away from the responsibility of oneself. The media's role in all these should be open for questions.

robertoduran in reply to Wilhelm Röpke

I personally don't accuse Germany, let's get this out of the way.

Greece cannot blackmail Germany. Press your politicians or vote new ones so that no aid is given to Greece.

You keep avoiding the issue about the characterizations of German press and commentators. You think it's ok to characterize whole nations as lazy, corrupt, and stupid. I want really to understand you, let's say your press was writing that black people are lazy and stupid you wouldn't have a problem i guess?

if some German people were burning American flags or accusing an American president as Hitler you wouldn't consider this reflecting on the whole German nation would you?

Furthermore allow me bring one more example from German history (not to accuse you, just to show how hardship clouds judgement and cultivates fanaticism). Last time Germany had 25% unemployment how informed and clever was the German electoral?

The more I listen to bickering among members of Euro countries, particularly of creditor v. debtor countries, complicated by an ugly history, the more I am certain that the euro will break up over time.

It's a nasty marriage -- just cut the cord already!

TomAlex in reply to Wilhelm Röpke

Like I said before, Angela Merkel has no obligation towards us, she never promised anything, she never swore to protect the country's interest and she was never paid by us to do so. She does all that for Germany and only the germans can judge her. So greeks should be(and are) angry at are our own politicians, who make a living on the fact that there is currently no clearly better alternative and this is what we desperately need to change(and no money is needed for that).
Next, the main issue is that the measures taken have vastly deteriorated, not improved the economy. If being more competitive is the goal, then after all measures products made in Greece are getting **more**, not less expensive. And that a child could have told you from the beginning since wages were never a serious issue for the private or even the government sector. The 'retirement at 55 ' is a myth unless you are talking about people who have been working since the age of 14. So is 'noone pays taxes': For employees taxes are deducted at the source, so this option is not available. Similarly it is not an issue of laying off indiscriminately or leaving it to the discresion of the completely incompetent Director or Manager to lay off people much more qualified and who actually do all the job. For example when you have a prosecutor who rules(with immunity) that a caught fugitive is not suspect of fleeing(and he flees as soon as he is released), why should this guy be on relatively high government payroll? Same for people giving furloughs to convicted murderers who already broke their first furlough? Or to judges who rule that pigs can fly. I am sorry, but many things presented in the foreign press are either inaccurate, miss the main point or create a strawman basd on the opinion of the lowest, most uneducated part of society.
The troika(supported by Germany) focuses on quantity(numbers), which is not the issue. If the state lays off people based on quotas, who do you think will be laid off: The director who got there because of party connections in an opaque way, or the guy with qualifications and abilities who actually does the job? And he would be replaced by an external company which would pay the corresponding employee less and make a lot more that what it was costing to have the competent employee who got laid off. So the troika is pushing for the leaches and the 'pimps'.

Furthermore when(at the troika's insistence) the government steps in to **change** existing contracts and agreements in the **private** sector(meaning less direct and indirect tax collection, loss of support for the pension funds and a total collapse of credibility), then the troika does become part of the enemy -and possibly your enemy too if the goal is ever repaying these loans-. They still cannot be blamed though, since unlike the government they have no obligation to us. So why would Germany appear to be openly supporting these fraudsters? What would be the reaction in Germany if I were to buy a German firm, say a Bundesliga team, then decide I don't like the player's contracts and ask the government to step in and change them by law? My point is exactly that: When you are siding with fraudsters, you are making the arguments of the extremists much more powerful.

In conclusion are many people in Greece and each one has a different thinking. Like everywhere else, there are people who will jump on easy solutions and scapegoats. On their own, their number is not enough to matter. Stupid, doctrinary policies are what is increasing their numbers.
And, you are completely wrong in blaming the guy in the street for this mess or tax cheating and so on. Of course germans taxpayers are even less responsible. However, the average citizen had the option of choosing betwen two very closely competing in corruption and incompetence parties(there is a reason why smaller parties are small-they were probably even worse). Thus, sort of forming a new party, there was not much to do. If you follow the Pangalos logic 'because I did not do my job, although I was handsomely paid to do so and voted for deficit upon deficit for the last 35 years while singing how great the economy was doing, appointed incompetent
and corrupt party members to key positions, threw money down the drain and did nothing about public administration and tax evasion, it's everybody's fault and everybodu but me should pay for it'. And as for tax evasion, americans for example are not happy about paying taxes either; the difference is what the state puts up with.

emmafinney in reply to Wilhelm Röpke

"The point in Greece is it were public servants who wore Nazi uniforms."

Big deal.

A German cabinet minister compared Bush to Hitler.

"Actually nobody believed Greece is able to manage joining the euro. But they insisted on it."

But it was the members of the eurozone who admitted Greece into the eurozone even though they knew Greece didn't meet the criteria for euro membership.

Shame on Germany and other eurozone members for making the euro a political project and admitting countries that they knew didn't qualify.

South American in reply to Wilhelm Röpke

I agree with you. But you can't avoid the problem. The political class in Greece and the Berlusconi press in Italy are blaming the Germans with anti-German slogans for their self-made problems (Greece and South Italy; Italys debts, Scicilia: 27.000 forest public servants, etc). Of course. But they are our problem too. We have a common currency. Greece needs time. Samaras is doing a good job. Monti is doing a good job. And Germans have to: etwas mehr einzustecken und etwas sanfter auszuteilen als andere; Is not just, but it's reality.

Wilhelm Röpke in reply to TomAlex

Thanks for your long statement. I cannot reply to all of it. Besides all that the government is not able to collect the amount of money it needed. So there should be a gap between what you say and what we can take as facts. If Greece would have installed the infrastructure needed it would be able to collect taxes. No obligation of register cash machines. So it was very easy putting VAT into oneself pockets. There is a huge gap and Greece runs short in money. That is fact. It is not only a problem in spending but also one in collecting money.

You are right in your conclusion that the Greeks should manage their problems with their politicians.

What the Greeks manufacture is too expensive compared to what Turkey offers - thats is just an example. Next to agriculture products services are very important to Greece. However, Greece has become much more expensive than Turkey. And this has to do with the euro. Greece bears a currency that is by far too hard for it. If you do not exit the euro you will live on aid for many years, better said, decades.

To achieve a level at which Greece would be competitive again is just doable through cuts. I am sorry but that is the true that was not said but known by all Greeks' elites.

Wilhelm Röpke in reply to South American

Money against sovereignty. As Mrs Merkel suggested it in Juni it has been quite calm in European capitals.

Of course is Germany part of the solutions as we are part of the problem. Nonetheless, besides debt, the main problem are still banks and this huge lack of competitiveness in many countries. Let me tell you this very clear. Germany is obligated to invest much more than it has in order to make sure that it can cope with the objectives ahead. The German investments are very bad, in ratio to GDP, and we do not secure our future as well.

Concessions are to be made from both. However, the debt loaded countries should understand that they can urge for more money if they are not prepared to cede
crucial parts of their sovereignty to a gremium that votes democratically backed
by it share of people or money paid in. Insofar there should be a understanding that Germany is to be granted a veto right. Today all speak about the money Germany should grant or pay in but just few are prepared to give something back to Germany.

TomAlex in reply to Wilhelm Röpke

Willhelm, "To achieve a level at which Greece would be competitive again is just doable through cuts"
I assume you mean the government changing by force conditions in the **private** sector(pretty much like me buying a Bundesliga team and then asking the Bundesrat to change the players' contracts), never mind that you will lose taxes that way, both direct and indirect as well as pension funds. And on that I think Schaeubble said it all: It's no use filling with water a barrel full of holes. When you give for example even more power to imcompetent managers, you are not going to have a stronger economy. Similarly, I have trouble convincing anyone who pays taxes to a government that in the midst of all this has the money for the prosecutor I described , or for building a mosque with state money (some 15 mil plus government land) and takes the responsibility to pay a mufti for eternity and of course to do the same for any other religion, then sorry, but I have a very hard time taking such a government seriously. So I do sympathize with Merkel and Schaeubble and their patience. But exactly because I am on the field instead of far away can tell you that the horizontal cuts are fueling the fire.

Wilhelm Röpke in reply to TomAlex

TomAlex, please take not out sentences from the context. Insofar I would ask you to read my statement again.
Within the euro zone Greece is only able to achieve a level, at which it would be competitive again, through cuts.
This is not what I wish - this is how a single currency works. Therefore it would be much better for Greece to exit the euro zone. If this is managed in order it would be the best for Greece. Of course Greece will need further aid to make sure that the public life continuous and the ill people receive treatments. This goes without saying.
However, if Greece decides to remain in the single currency it needs debts forgiveness and further cuts. Compared to Turkey, Greece is simply too expensive. I understand that this is hard to acknowledge but all Greeks should be clear on that. Depreciation has been the key to solve such crises for thousand years. But today some believe they are wiser than what history tells.
On the other hand I do not understand why Mrs Merkel and many more put pressure on Greece in order to hold it in the euro. I do not intend to be disrespectful but Greece cannot get back on track within the euro. This is simply impossible if all conditions remain as they are. I just describe the conditions. To me Greece is like a 80kg man who carries 160kg weights. The man is simply unable to carry the weights for any longer. But Mrs Merkel and Co. push the man
to train more and to swallow pills. But his body constitution is simply not able to carry 160kg. So the only option is to help him get off some kilograms.
Despite all the political effects an exit would cause. I believe it would be the best for the people. An exit should be understood in that way that all 16 nations would provide help for Greece and provide the money needed in order to survive 2 to 5 years.

TomAlex in reply to Wilhelm Röpke

I am not against an exit; I just think this should be prepared in a way that it causes the least amount of trouble possible to all parties involved. I should add that in my view though the euro is not the source of the problems-it is just a currency. If the state is criminally inefficient, this can be (manisfestly) done both inside and outside the euro. Same for the private sector: If you have incompetent managers, who crack down on productive people and their only concern is giving themselves huges bonuses, this can also be done either inside or outside the euro.

What about Bob

"Several municipal workers in full Nazi uniform, one of them with an Adolf Hitler moustache, drove a jeep flying swastika flags through a central boulevard."
Are you sure that they were not Golden Dawn members?


it should not be about pitting countries against each other, but rather taking a look at "democratic and political culture"
and i'm sorry to say my southern friends, but if i see the typical nepotism and cronyism ruling your systems than i guess we must ask whether you have failed your countries as individuals...(since way back)...and therefor stop the blame-game!


Merkel's state visit was long due. Greece has been at the centre of the crisis and Germany could not ignore the small troubled country, which is struggling to balance its sheets and clean up its act. Things haven't been getting any better with a memorandum meant to do just that which was signed with a condition to trim down salaries and pensions, governement bonds and generally government spending. A deflating economy means plummeting incomes, worse services and, ultimately, a deterioration in all indexes. So the given medication resembles homeopathy, ie it's been causing more of the symptoms it's supposed to cure...

Tony G

Stop lending money to Greece in order to pay their debts to the banks and instead lend them money to buy back their debt.Right now the Greek 10 year bond spread is at 1700 which means that you can buy bonds worth 100 billions with a discount of 80% in the secondary bond market.


Germany have to realize that Greece will always need more time. Europe will always have 2 poles, the rich north and the unproductive south. What's more, Greek culture is rooted in ottoman customs, which will not go away anytime soon. If they want us to stay in the EU and enjoy the Mediterranean sun, they 'd better get used to that situation

South American in reply to MickTheGreek

Sorry Mick the Greek. 1) There is no natural law that divides North and South. Israel is in the south, Singapore is in the south, Brazil is in the south, and these countries are developing well. 2) Turkey has a good economic development. It seems, according to your words, that the true heirs of the Ottoman Empire are not the modern Turks, but the Greeks... But that's obviously polemical. Greece has a difficult history. After the second world war, the massacres of the German army and the deportation of Greek Jews to death camps, occurred the civil war that was devastating for Greece. Since the civil war, the Colonels' dictatorship, the Greek society is split. There is no modern leftist parties, there are no developed civil society. The mentality is that everyone wants something from the state, but everyone pursues only its own interests. It is as if you wanted to have a welfare state, but did not want to pay for it.


The IMF now admits that its formula for calculating the effect of austerity, one half percent of growth lost for every percent of austerity imposed, is wrong.

Now they admit the loss of growth is .9 to 1.7 percent for every percent of austerity imposed.

The destruction of the Greek economy by the ECB and the IMF isn't important. What's important is that all those clever politicians and economists in high places continue to enjoy their salaries and perks.



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