Yes, the numbers are good. Greece has promised to reduce its 13.5% deficit in 2009 to about 9.5% in 2010. But the next big bang is the UK. Today the European Commission has warned the UK that its high stimulus spending + its growing deficit of about 12 % for 2010 (the largest in the EU, larger than Greece's) + a slower than expected recovery will produce a volatile cocktail. If the UK crashes, the EU is gone. Now, I wonder how much is the UKs share of the EU's bailout package to Greece? How can one who is in trouble dig itself in deeper trouble to help another in trouble? Where does the money come from? From thin air?
Paper money is what we used to call Banana currencies. If the Chinese wake up one morning to find out the US has increased their money supply via the printing press by 100%, they will feel being cheated. Do you think the Chinese will forgive the US and continue to be a large buyer of US treasuries? Of course not; and without the real money machine China (not the US printing press) the US economy is headed one way-down. Who is confusing gold with paper money? At least in the gold standard there was some restraint on the US's ability to resort to the printing press. Now, all hell is breaking loose. Perhaps the US should index China's holdings of US treasuries to US oil reserves. China has a huge appetite for oil and she will be more than happy to swap loans with oil. With such a benchmark, China need not worry about any attempts to the printing press by the US. It will be a win-win situation for both.
feel cheated? u think china is that naive of not knowing what and why they are buying US papers? if even taneepak knows it, i surely bet china knows it too. Both china and US are big boys, they don't each other forgiveness to do what's right for their country.
You speak from 2 sides of your mouth. In previous posts, I argued against USA running huge US$1.6T deficits this year and still add Medicare to its budget without cutting elsewhere to make up for this pet project, and that BO is projecting huge deficits throughout his entire term in office. You said 'deficits, what deficits'. Your post 'How can one who is in trouble dig itself in deeper trouble to help another in trouble?, similarly, 'how can USA who is in deep financial trouble dig itself in deeper trouble to finance another expensive project'. I ain't have no problem with you being partisan to CHN, we are too to our countries, but I just can't stand hypocrites.
Let us separate the two, that is the UK in the EU and the US. As I have said earlier, the UK has a high stimulus spending, an expected huge deficit of close to 12%, and a slower than expected recovery. This is bad enough. But now that Greece is in trouble, and being a member of the EU, othet EU countries have to loan Greece bailout money in proportion to their size. Now how is the UK going to raise this additional requirement and then hand it over to Greece? This is on top of the triple threats mentioned above. Now let us take a look at the US. I will have to look at the big picture because choosing what to highlight on a selectively macro or micro basis distorts the big picture. Yes, the US has a huge stimulus spending package. It also has deficits that will go beyond and towards 2019. It will have a much better recovery than any EU country. Re the deficits, look deeper and you will find a declining trend for the next 10 years. In 2009 the deficit was a staggering 13% of GDP. For 2010 this will come down to 10%. Although it is still a deficit it is an improvement of 3%. For the next 10 years 2010 to 2019 the deficit will average US$974 billion per year vs 2009's deficit of US1.845 trillion and 2010's deficit of US$1.43 trillion deficit. On top of this the US economic recovery will be much better than the EU's. With a healthy recovery and a declining deficit over the next 10 years-mind you the deficit as a percent of GDP will shrink even more given the double whammy of declining deficit in absoulute dollar term and an increasing GDP from recovery-the difference between the US and the EU are like day and night. If you just selectively see only the stimulus spending side without looking at the big picture, you cannot see the forest for the trees.
Right away I feel so much better what you say "For the next 10 years 2010 to 2019 the deficit will average US$974 billion per year"...and I cannot imagine how many zeroes are in that figure which is so close to a trillion. That is ridiculous to overspend that amount for the next 10 years. If business or a family unit operate in this fashion, no one will survive. Those parents who voted for overspending presidents should look at their children eyes and see what facing them in future, a reality check.
The problem with euro is the speak different languages. Tension will be more. whats this 1000 points drop? A mistake or not? What is this guy trying to say? http://blogs.sybase.com/tradingandr...lgos-blamed-wrong/comment-page-1/#comment-273
Actually the revised deficits are smaller, closer to US$700 billion per year for the next 10 years. These numbers are by themselves frighteningly huge. But as a percent of GDP it is quite small : US deficit as percent of GDP: 2008 (3.2%); 2009 (12.9%); 2010 (8.5%); 2011 (6.0%); 2012 (3.4%), 2013 (2.9%); 2014 (2.9%); 2015 (2.7%); 2016 (3.2%); 2017 (3.2%); 2018 (3.1%); 2019 (3.4%). The GDP growth for the same period obviously helps to bring the deficits as a percent of GDP down. The US has a long history of GDP growth and it is not like Greece. Without the two big blips in stimulus spending in 2009 and 2010, and to a lesser extent in 2011, the scenario would be a disaster.
Good news, unemployment is Up! That's obamanomics for ya. (or this media writer works for the government) _________________________________________________ Why a Rising Unemployment Rate is Good News By Rick Newman Rick Newman Fri May 7, 11:11 am ET It sounds dreadful. After drifting down consistently since last fall, the unemployment rate has suddenly shot up again, from 9.7 percent in March to 9.9 percent in April. But don't despair: A rising unemployment rate is actually one of the best signs yet that the economy is bouncing back. The unemployment rate rose for the right reason. Instead of shedding jobs, employers added 290,000 jobs in April, the strongest showing since 2007. The reason the unemployment rate went up is that a lot more people are suddenly looking for work. The government said that the labor force swelled by 805,000 people in April. That's more than three times the number of new jobs, so the proportion of people looking for a job but unable to find one went up. Still, that big increase in the labor force marks an important shift in sentiment among people on the fringes of the economy. One of the most worrisome trends throughout the recession and early stages of the recovery has been the declining size of the U.S. labor force itself. By late last year, so many unemployed people had given up looking for a job that the labor force participation rate--the percent of adults who either have a job or are looking for one--had fallen to a 25-year low. Others who might have entered the labor force--recent graduates, stay-at-home spouses--decided not to. The government considers the labor force to include everybody who either has a job or is looking for one. So if you get laid off and spend your days hunting for a new job, you count as part of the labor force, even if you're not earning a paycheck. But if you get discouraged and give up, you don't count. Until recently, the ranks of "discouraged workers" who had given up looking for jobs had been swelling at alarming rates. Now, a long-term decline in the labor force participation rate finally seems to be reversing, as more people decide that it might be worth looking for a job after all. The participation rate bottomed out last December, when just 64.6 percent of working-age adults belonged to the labor force. It ticked upward for the first three months of 2010, and now it has risen to 65.2 percent. Before the recession, it hovered above 66 percent, so there's still a way to go. But the mere fact that long-unemployed people are looking for work again is encouraging. One reason economists worry about a "jobless recovery" is that people who have been out of work for a long time find it extremely difficult to rejoin the working world, even as the economy recovers. They tend to lose touch with workplace trends, miss out on new skills, and simply become unmotivated. It might be tempting to write off the long-term unemployed as dropouts, except that not long ago they were productive workers who earned money and contributed to economic growth. Consigning them to the sidelines depresses the economy--and adds more weight to a social safety net that's already frayed. About 195,000 formerly discouraged workers have now reentered the labor force, presumably because they think the chances of finding a job are getting better. That's a tiny fraction of the 6.7 million Americans who count as the long-term unemployed, but it's still a break in the gloom. Another 610,000 people entered the labor force without being technically unemployed, a sign that first-time workers and other job seekers have decided to get off the couch and start hustling. There are a lot more where they came from, which means the unemployment rate might still rise in future months, before it turns around and starts declining for good. For once, it will be something to cheer.
Words of wisdom from Timmy “It was like spaghetti clumping together.” – U.S. Treasury Secretary Timothy Geithner, speaking to the U.S. commission on the financial crisis, finds an appetizing analogy for the tangled mess of mortgage
It's Space odyseey 2010 I’M AFRAID I CAN’T LET YOU BUY THAT, DAVE “I think the machines just took over. There's not a lot of human interaction.” – Charlie Smith, chief investment officer at Fort Pitt Capital Group, suggests Thursday’s seven-minute mid-afternoon meltdown on the Dow was evidence of computerized program selling run amok.
Pot Calling The Kettle Insolvent “Oh my God, I wouldn’t want to be in the position they’re in.” – Iceland's finance minister Steingrimur Sigfusson tells Bloomberg News that his country, as big a mess as it was, was still better off than Greece because at least it had its own currency, not the euro.
I don't understand. Gordon Brown in the UK is very proud of the fact he has a "plan" (not proven yet) to reduce the deficit by a half? I am puzzled, it is still a deficit, a loss....where is the money coming from?
from.. creative accounting Just hire the best banker like Goldman Sach and they will repackage anything into something smelling like roses
i prepared these links because they both sounded so similar 1937 hindenberg flame out http://www.youtube.com/watch?v=xiAT9xvTVKI (1:00 onward) 2010 market flame out http://www.youtube.com/watch?v=ZiZtPTLuPtw (1:00 onward) then i check wiki on the hindenburg disaster date, to see if anymore similarity. I was floored to learn the dates: other similarities The Hindenburg disaster took place on Thursday, May 6, 1937 Wallstreet record intraday drop (DJ and SP500) took place on Thursday, May 6, 2010 Location of hindenburg disaster, NJ, USA Location of market calamity, NY, USA Hindenburg was a german passenger airship LZ 129 preparing to dock after some delay to wait out a storm. After the storm passed and prepared to dock, a gust of wind knock the ship back and forth, ripping some fabric. The market sell off was related to the german bail out of greece after a successful bond issue by greece but the market wind is still gusty
no sure how true it is. My friend told me some well off greeks pay less taxes than ordinary people. 5000 declared they have swimming pool while >100K didn't declare it. Govt employees over paid. Doctors pass less taxes than ordinary people. The rich gets richer. Now I wonder if they are going to change for the better or at other euros expense... It is ridiculous...
it's true. Greek laughed at their gov't that they can cheat on taxes. Patients bring a load of cash when seeing doctors and buying things. Both sellers and buyers are in it. Most protesters now are public workers. Average retirement age of greek is 61(or younger), lowest of all EU. That is why germans dislike bailing them out. Why a 64 year old german have to work to fund pension for a 61 year of greek? When greek joined EU, they all want to live like european but without european salary, taxes, and work ethic. Greek gov't have to pay bonuses (on top of their regular salary) to public workers to start work on time. The whole country is living off borrowed money for the past 25 years.
here are some ( i mean only some) hilarious socialist welfare looks like. _____________________________________________ FACTBOX-Five areas of Greek budget waste Wed Apr 28, 2010 2:27pm EDTRelated NewsTimeline: Greece's debt crisis Wed, Apr 28 2010April 28 (Reuters) - From a bonus for showing up to work to collecting dead father's pension for unmarried daughters, arcane benefits bloat Greece's budget by billions of euros a year. As part of its efforts to end its debt crisis and escape default, Greece has pledged to start cutting back on such largesse, but decades of chaotic accounting at ministries means the exact statistics are hard to come by. Below are examples of some of the spending the government could cut: SPOILED SPINSTERS Tens of thousands of unmarried or divorced daughters of civil servants collect their dead parents' pensions, weighing on a social security system experts say will collapse in 15 years unless it is overhauled. About 40,000 women benefit from the allowance at an annual cost of around 550 million euros, according to economic website capital.gr. While the law protects civil servants from dismissal, it allows them to retire with a pension in their 40s. Greek pension spending is expected to rise by 12 percent of gross domestic product by 2050, according to EU Commission data. That compares with an EU average of less than 3 percent of GDP. The government has pledged to overhaul the social security system by raising the retirement age and banning early retirement. It plans a bill by May. CHRISTMAS PRESENTS In a system where bonuses can add 5 to 1,300 euros to a monthly paycheck, some civil servants are paid extra for using a computer. Some get a bonus for speaking a foreign language and others for arriving at work on time, while many foresters get a bonus for working outdoors. All Greek public and private sector workers get 14 salaries a year, a structure aimed at keeping basic monthly salaries, and the pensions that are based on them, low. Half a month's extra salary is paid at Easter and another half during the summer. The 14th salary is paid to civil servants at Christmas when the whole economy is geared to consuming it; taxis, restaurants and hairdressers are legally allowed to charge extra as "a Christmas present". The government has already trimmed most bonuses by 12 percent and Christmas and Easter salary bonuses by 30 percent as part of its austerity plan, saving 1.7 billion euros. FLYING FOR FREE Labour unions foiled government attempts to sell debt-ridden Olympic Airways for decades, costing Greek taxpayers millions while employees enjoyed generous benefits -- their family members could fly around the world for free. The EU took disciplinary measures against Athens for pouring state money into the loss-making airline, even after private local airlines began servicing similar routes for less. Olympic was sold in 2008, but only after the state lavishly compensated or re-hired about 4,600 employees. Many blocked Athens' thoroughfares recently because they had not received all their severance money. The state owns 74 companies, mainly utilities and transport firms, many of which are overstaffed and loss-making, the OECD says. The main rail company employs about 9,000 people and reported losses of 800 million euros in 2008. The government has said it will merge some state companies and sell stakes in others. COMMITTEE FOR WHAT? Hundreds of state-appointed committees employ staff though it is not clear what they all do. Greece has a committee to manage Lake Kopais, which dried out in the 1930s. One Greek paper estimated that committees employ more than 10,000 people and cost over 220 million euros a year. Coming through on a pre-election pledge to cut such waste, the government recently announced it would shut down or merge at least 200 such committees that have outlived their usefulness. COSTLY ARMS Tensions with arch-rival Turkey have kept Greek military spending well above that of other EU members, reaching 14 billion euros, or 6 percent of GDP, in 2007 and 2009. Budget woes have limited military procurements and the 2010 defence budget now stands at 6.7 billion euros ($8.92 billion). But nearly 80 percent of Defence Ministry spending goes on administrative costs and payments of army staff. The government has said it will gradually reduce costs and spending on arms purchases will be contained to 1.8 billion euros (0.7 percent of GDP) this year. (Reporting by Renee Maltezou; Writing by Dina Kyriakidou, Editng by Lin Noueihed)
my word... this is an archaic rule. Spartans? Crazy. Should not have let them get the money. A total government failure.
