• REMEMBER THAT NUMBERS ARE PEOPLE LOOK FOR COCK-UP BEFORE CONSPIRACY • ALWAYS CITE PRIMARY SOURCES


Monday, 28 June 2010

EU CAN HAZ ANARCHISTS!

From a LinkedIn discussion, which you can follow here:

Will Greece go bankrupt?

My response:
"I strongly believe that Greece needs to restructure its debt. The sums don't work. We can't grow our way out of this monstrous amount of debt, and we can't cut our way out of it without Mad-Max levels of civil unrest. 
Some of my rationale can be found here.  
On the other hand, if we do give our creditors a substantial haircut, it will set off a chain reaction that could bankrupt a number of banks around Europe, and in fact WILL send the entire continent into depression. Already, interbank lending in Europe is frozen. It won't take much to send the system into meltdown.
Clearly, the EU will not allow that to happen even if it means that France has to annex Greece (Germany won't do for obvious reasons, plus much of our elite would secretly enjoy that). This may sound like a joke but a massive loss of sovereignty can come about in very simple ways - a Eurozone country without a vote in the Council (an idea that has been mooted by some), and with its budgets subject to Eurozone finance ministers' approval, will have no say on most of the legislation it is subject to.
So what is going to happen is that Europe will keep us high on cheap debt until they think it's safe to let us go. We will only be sovereign in the most trivial sense for the next 10 years, during which time we will give our creditors one or two minor haircuts.
This could of course change radically if Spain, or Italy or anyone else starts to need this kind of help. Putting the entire periphery of Europe on subsidised probation will really bring the whole thing to the boil. The EU will do all it can to contain this type of mechanism to one or at most two minor Eurozone countries.
And then there are some massive wildcards still to be played. As power is transferred from the Greek government and parliament to the EU institutions, the crosshair for our "known-unknowns" will move from Athens to Brussels, Strasbourg and Frankfurt. And then it's really going to hit the fan. 
What happens when it's not our Minister of the Interior but an EU Commissioner that gets their office bombed? What happens when the older generation of our urban guerillas finally decide to shack up with their posh yuppie girlfriends in Brussels and start firebombing Belgian coppers? What happens if our demonstrators occupy the Berlaymont instead of the Acropolis, or if the mayor of Strasbourg should wake up to the entire town spray painted with "No job, no church, nothing to do man! - Let's sh*t on the grave of Schuman!"? 
I don't have the answers to that."

Saturday, 26 June 2010

SAFETY EPIC FAIL

So, G-PAP, why is it safe to invest in Greece? I'm asking because I keep getting queries about how to move money out of Greece to a UK bank account and I'd like to just tell everyone to leave me alone.

My line so far has been that when Greece finally defaults, there really won't be any safe place left in Europe to put one's money except into gold coins and up one's own rectum.

But now our PM offers a glimmer of hope. How, I hear you ask?

Enjoy his ludicrously chummy interview with FOX News, that unrivalled bastion of socialist thought. G-PAP explains that Greece is a safe place for tourists, and hence a great place to invest if you're keen to profit from that industry. 0:22" into the interview, the FAIL lands with a momentous thud:





"Greece has a tourism industry that can really thrive, and which can become more attractive; we're now moving into niche tourism, high-quality tourism; Greece is a safe country, it's a beautiful country, a hospitable country, I'd like to make that plug on FOX News [...] " [Emphasis mine]

Let's qualify that, shall we? There are still some parts of the country that are pretty rough, where a man (or woman, including pregnant ones) can get killed just minding his/her own business. Like any bank in the centre of Athens. Like that training centre for bureaucrats in Patissia where a 15 yr old Afghan boy got a heavy sample of our hospitality. And, recently, like Greece's ministry for law enforcement, where the correspondence (no doubt checked diligently by the heavily unionised security staff and postal workers before them) has become literaly too hot to handle.

To be fair to G-PAP, no one actually mails any bombs to any of our islands - perhaps they can't be sure they will arrive. Indeed, there are almost no recorded incidents of this sort anywhere in the countryside. Which begs that question: who are our urban guerillas?  Any guesses as to where they live, or where they meet? Any guesses as to why they do what they do? (Actually, there have been some early guesses, in this excellent piece of research.)

At any rate, some of our compatriots are not too keen on these questions. What appears to matter to some is who bears the political responsibility, and who should therefore resign. Others do not mention the news at all - as they say, only the state and the capitalists are murderers. Others still, elected political leaders no less, say it's all a ploy to divert attention from recent austerity measures. The fact that some of our compatriots have no regard for human life in their ridiculous pursuit of failed ideologies is secondary

Let me be clear: the tiny, fringe element of the Greek Left will not cease to be knuckle-dragging subhumans if G-PAP and half his cabinet quit. Their well-to-do fathers will not grow a pair and turn them in if we beef up security at ministries. Those of our pupils who live for the few weeks of school occupations per year will not apologise for glorifying the molotov culture if every employer in the country accepts responsibility for the bombing.

It is true that Greece has enormous wind energy potential. If only the wind weren't blowing out of our own arses.

Friday, 25 June 2010

YOU CAN HAZ GREEK ISLAND!

I've been saying for a while that there is no taboo surrounding island sales - past Greek governments have contemplated this even when the country was not looking the Grim Reaper in the eye.

Now the Guardian reports that the Greek Government is seriously considering the sale of state property on islands (including some of the lesser islands themselves). Even parts of Mykonos are not exempt.

I for one am 100% in support. Remember, selling an island does not make it any less a part of Greece - Greek law still applies, and the Greek state holds as much power over a private island as it does over central Athens.
Except now, somebody else beside the Greek government can pay for much-needed infrastructure: from sanitation, electricity and broadband to schools and hospitals if enough people turn up.

As a matter of priority, I would start selling off crappy little bits of rock near the Turkish coast. A wall of foreigners would be a better guarantee against invasion than a thicket of missile arrays - and it make, rather than cost, money.

Wednesday, 23 June 2010

LABOUR MARKET FAIL

LOLers rejoice!

The first Labour Force Survey of our post-sovereign era is out, and it's a real gem.

I can spend all day pondering how come so many Greeks suddenly went into farming, or how come we can afford so many more maids when the country is going to the dogs. But my basic question is this:

If we're not about to default, how come international quango jobs are up 20% in a single year?

See for yourselves:



Every Greek taxi driver worth his/her salt knows a veritable army of Ph.D.s who aren't working, or worse, are also taxi drivers. Coffee circles and book clubs full of Greek dinner ladies in their 60s shake their heads in sympathy on a daily basis.

Only now what we all used to bullshit about is actually true. A Master's degree is less likely to get you a job in Greece than a Bachelor's.

Of course, the ones that have suffered the most in this new labour market have been women with an incomplete elementary education, men with no schooling or who only made it to junior high, and women with one of those rubbish "higher" education vocational diplomas. But graduates probably never saw this coming.

It gets even more absurd if you're a woman. Women with no schooling are actually doing better in the recession than they did before - and, for the first time, a woman has to get a degree in order to do better in the labour market than one of her completely unschooled sisters, who don't minding scrubbing the odd floor.

At least, one might think, the share of workshy bastards with job offers who decided to stay on the dole or keep scrounging off mom and dad is down  - they are now only 8.9% of the unemployed. But due to the rise in unemployment, there's a few more of them - 52,000 of them in fact, up from 51,400.

LOL LECTURE IN LONDON

Why Greece should default
LSE public lecture

Date: Wednesday 14 July 2010
Time: 6.30-8pm
Venue: New Theatre, East Building
Speaker: Alan Beattie

Going back to Philip II of Spain in the 16th century, government debt defaults need not be disastrous as long as they accept the reality of their situation. The main problem with Greece is not the prospect of default but the fact that the eurozone has been in denial about its problems.

Alan Beattie is the Financial Times world trade editor, he writes about economics, globalisation and development. Born in Chester, he attended a local comprehensive school before graduating from Balliol College, Oxford, with a degree in history. After taking a master's degree in economics at Cambridge, he worked as an economist at the Bank of England and then joined the Financial Times in 1998.

This event is free and open to all with no ticket required. Entry is on a first come, first served basis. For more information, email events@lse.ac.uk or call 020 7955 6043.

Media queries: please contact the Press Office if you would like to reserve a press seat or have a media query about this event, email pressoffice@lse.ac.uk



I wonder if amateur bloggers can get a press pass... stay tuned 

Monday, 14 June 2010

EVIL SPECULOLTORS, DOMESTIC EDITION

How do you know you're a good-for-nothing evil specuLOLtor?
Apparently, it's when you refuse to supply a customer when they haven't paid you for FIVE years.

Here's the deal the Greek government recently offered hospital suppliers, to whom we owe EUR5.6bn:

  • We'll pay you EUR230m in cash.
  • The other EUR5.27bn will be paid in zero-coupon bonds. That's Greek Government bonds that pay zero interest. The kind recently downgraded by a second credit rating agency, which means they are likely to land you with a nasty loss if you sell them for cash, and equally likely to land you with a nasty haircut if you hold them to maturity.
  • So to be very clear. In return for putting up with 5 YEARS of deferred payments - credit terms that would be unacceptable to a stunt codpiece - we we make you give us a 19% discount AND lend us money to boot.
Remember, this is not how we deal with suppliers of paperclips. This is how we deal with hospital suppliers. The people we depend on to keep our national health service running. Unsurprisingly, they've given up supplying us so the National Health survice isn't running as it should.

This means that we now have a Third World country's public health infrastructure, to match our Third World fiscal figures. This, my friends, is crunch time - the make-or-break moment when our Government can doom the country forever or lead the way back to sanity (although we will still end up defaulting). Cue an inspirational and reassuring statement from our health minister, Mariliza MUPPET Xenogiannakopoulou. More here and here. I translate below:

"The Government and the State will not be blackmailed. We will push through with this settlement, because we have an obligation to restore sanity to the Healthcare sector, but everyone has to finally get the message: the party is over."
"Unfortunately these days we see a double blackmail being carried out, against the National Health System and, ultimately, the Greek people. While the Government has proven that we mean what we've been saying all along, namely that we will do a deal and settle the debts of the past, which as you know we took over upon coming into government, as they date back to the 2005-09 period, we see this double blackmail taking place."
"On the one hand, one share of suppliers, who do not accept the terms of the settlement, and on the other those who do not want the new rules we're imposing to come into effect, so that order, proper oversight and lower prices can be brought to the market for consumables."
"It is inconceivable that they refuse to accept the settlement. They made a lot of money in the past few years. We know about their surcharges. There will be rules. We are fighting every day." 

The lack of humility is staggering. It doesn't matter one jot to our suppliers that Mariliza didn't run up the debt herself - she's the person holding the bill, and her other hand is empty. That's the continuity of government for you. But most perverse of all is the lack of any concept of supplier cashflow, or the basic rules of credit. Anyone ever run a small business over in the Ministry of Health? Surcharges are par for the course if you insist on ludicrous terms of credit. Except of course small businesses (or medium-sized ones, or even most large ones) can't get away with 5 years. Well now we can't either. Because our debt is junk.

Here's a statement that will please me: here's the bonds, folks. If you take them and we default, we will back them up with a stake in the actual hospitals you supply. Happy? Thought so. Since we're never going to default anyway (right??) that's a win-win. We get our better terms and they get peace of mind.

Over to you Mariliza.

UPDATE: People have finally cought on to the fact that the restructuring of Greek hospital debt is tantamount to default. H/T To Nick Shay for pointing out this story. 

Saturday, 12 June 2010

RECOMMENDED READING FOR THE DAY AFTER

With D-day closing in, it is best to read up on what to do when credit markets no longer want to know you.


Ominously enough, IMF staff have just released a paper on addressing the problem of gaping current account deficits in South East Europe (hint!) and another on estimating the bond yields of African countries borrowing for the first time or returning to the capital markets after a long, default-triggered absence.

I'll return to this once I've read them but how's that for timing?

Thursday, 10 June 2010

THE APPRENTICE FAIL, PART 2

I recently wrote that the abysmal failure of the Apprentice franchise in Greece tells one all one needs to know about what is wrong with our country. I was going on my general feeling on that one, but as it turns out there is evidence. Yay.

Enter the research wonks and the European Commission's latest Entrepreneurship Survey (full report here).

The story, in brief, is that Greeks don't like working for other people but we also don't like having unsteady income streams. Presumably the ideal profession of the typical Greek is living off their parents' savings, or off pension/benefits income. We agree that entrepreneurs create jobs, but we also overwhelmingly believe they are exploiters out to make a quick buck. How aspirational.

See how we rank at the EU/Global level below. Compare and contrast with the openly socialist, but actually successful, China (CN).


Wednesday, 9 June 2010

HE'S GONNA BRING IN INVESTMENT FROM *WHERE*?

I have nothing to add to this story. It appears that our PM, G-PAP, has given up all hope of getting foreign direct investment (FDI) from anyone who is not a 100% f*cknut, and is now going to turn to Gaddafi's Libya.

There's a reason of course why we can't get FDI from less ridiculous sources, as I've explained here: our governance structures are crap and we rely too much on EU structural funds.

To be clear, this is no bailout, as the Libyans will not be buying our bonds; simply an investment deal. Some of the details the FT is quoting sound like reasonable things for us to do, like investment in renewables. But, make no mistake, there will be strings attached.

For instance, one cannot help but draw parallels with Papandreou Sr's (G-PAP's dad's) plans to turn Greece into "Switzerland for the Arabs".  It is apparently Gaddafi's friendship with A-PAP that Yorgo will be falling back on to seal the deal. As if.

So try this out. Only very recently, Gaddafi called for holy war against Switzerland. They made the substantial mistake of deporting his son after he beat the crap out of his servants in one of their hotels, which apparently is illegal in Switzerland (go figure).

The UN duly criticised this act of lunacy. Would G-PAP be able to do the same next time Gaddafi gets a bee in his botox? Aaah, I see. So G-PAP, will you join me in singing the Internationale? Surely you know how it goes?

Il n'est pas de sauveurs suprêmes
Ni Dieu, ni César, ni tribun



[...]


Les rois nous saoûlaient de fumées
Paix entre nous, guerre aux tyrans
Appliquons la grève aux armées
Crosse en l'air, et rompons les rangs
S'ils s'obstinent, ces cannibales
À faire de nous des héros
Ils sauront bientôt que nos balles
Sont pour nos propres généraux




...and Colonels, presumably.

Tuesday, 8 June 2010

GREEK FINMIN DISMISSES BEAR POOP IN WOODS RUMOUR

I was overjoyed to hear today that our Government spokesman George Petalotis trashed rumours of a Greek default. No doubt some clever clogs in one of G-PAP's endless consultative committees thought that using our PR bitch instead of the actual minister to make this statement would be a true macho statement - slapping the markets around while keeping our pimp hand strong.

For the non-Greek speakers among you, here is what the great man said:

"Lately we are witnessing various rumours of a return to the drachma, of debt restructuring, hybrid funding facilities and other such novel matters [...] It is obvious that such spreading of entirely unfounded rumours can only bring about confusion and disorientation to all of Greek society's efforts to effect a safe exit from this crisis."

"We of course categorically dismiss all of these fanciful scenaria, wherever they come from, whatever their motivation, and whatever the means by which they are spread throughout Greek society."

"There is no question of default, of a return to the drachma, or of any of the things being alleged these days" [and citizens should feel secure based on the Stability Programme being implemented by the Government] "which will set us on a different course henceforth."

[When asked about the origin of these rumours, Mr. Petalotis said that] "we cannot make assumptions or conjectures" [and stressed that it was important to note that] "some people are profiting from the insecurity being spread around society."

[Moreover, Mr. Petalotis said that] "everyone has their opinion and motives when making statements regarding the Greek economy." Wink?

[He also stressed that "this Government is hard at work and has made great efforts in order to put in place the support mechanism] "without which we would not be able to speak with the certainty and security with which we do."


There are many layers of FAIL in this story. First, the reporting itself.

Out of 36 stories on this subject, once Google News' duplicates filter was in place, 33 were removed as precise duplicates; many duplicates came from reputable sources, not the odd blog.
Which left me with this:



Does anyone doubt this ridiculous litany of bravado was disseminated by the Government itself?

Second, the christening of statements by named commentators (of whom I am the lowliest) as "rumours".

Default theorists may be wrong ( I doubt it) but there is no doubt they go by their own names when making predictions. Try Wolfgang Munchau, Edward Harrison, Mohamed El-Erian,  Desmond Lachman, Ben Chu, Paul Krugman, Felix Salmon, Paul Donovan, Jacob Funk Kirkegaard, Matthew Yglesias, and of course myself. I did not pick these people because they are "right" or because their credentials are impeccable. I picked them because they featured in the top 4-5 pages of google results and are named commentators, most with the wherewithal to offer some opinion, even if you and I don't agree with them.

So come on, FinMin, get one of your bitches to tell me I'm wrong. You may convince me yet. But do not dismiss my opinion as "rumours". I'm shouting it from the rooftops and anyone curious to find out who I am need only click through a single link. You can look up where I live and work.

Third, the sense of déjà vu.

First came the emphatic assertions back in 2009, that we were nothing like Dubai.

Then came the assurance by G-PAP himself, that we would not need the EU's nebulous gesture of support back in February.

Then, there was the assurance from ourselves and the Germans, and from the IMF, that we will not need an IMF-financed bailout. We called the suggestion "a joke". A joke? Who the hell is laughing?

Then we told the evil specuLOLtors that they will lose their shirts betting on a Greek default. No one has yet.

Now we tell everyone we will never default. History is just not on our side on this. If FinMin were remotely honest they could just say: "we don't want to default; and we do not believe we have to default; we will stake our political careers on not defaulting. We may still do it, but not while this government has any options left this side of dictatorship." Don't tell the market what it will do. Tell them what you are going to do and cross your fingers.

Good luck FinMin. Save me some of your lovely furniture when you liquidate.

Sunday, 6 June 2010

THE GREEK DEFAULT POLL

As readers know, I'm a recent convert to the case for a Greek default, but what will ultimately happen is not for me to say. While we have time, we might as well speculate on how things will turn out.

For this reason I've created a poll on Linked In, and would be very grateful if you could take some time to respond. It's only a single question long and I promise to publish the results if I get more than 100 responses.

The poll can be accessed here.

Saturday, 5 June 2010

UK GOVERNMENT DATA WIN

As my readers know, I spend a lot of time laying into Greece on this blog. The fact that I live in the UK will perhaps suggest to some people that I've fallen prey to the American Uncle Disease, whereby Greeks living abroad denounce the old country in the belief that their adopted homeland is perfect.

I am under no illusions that my country of residence is some libertarian paradise, and having voted in some pretty disappointing Conservatives back home in my time, I also won't delude myself that the current Con-Dem government in the UK is any more enlightened than the last Labour one.

But they did do one thing today that I seriously wish could happen back home. They published, no questions asked, the complete dataset of the last year's public expenditure and this year's budgets, item by item, to minute detail. It runs to a wholesome 10GB of data, which you can download, without any clearance or registration required, from here. You can get even the data through BitTorrent, which is so cool I don't have words for it.

The database is even more accessible from the Guardian website (of all places).

So, if you want to know, say, how much the UK Government spent on consultants in 2008/9 (£1.8bn), you can. You don't need to *know* anyone, or pay anyone, or be a member of the press, or steal somebody's briefcase, or sleep with a morbidly obese government official who's into BDSM, or whatever. You just go online and get it as is your goddamn right as a taxpayer. And if you don't like what you see, you write to whoever's responsible, copy in a major TV station or newspaper and watch the culprits squirm.

SQUIRM PIGGIES!

The second UK innovation I'd like Greece to copy ASAP is a Non-Job of the Week column. In fact I might start writing it myself. That's when you rummage through the most recent list of public sector vacancies to find the stupidest and most wasteful public sector jobs going. Then you make fun of them, and the people that came up with them. It's free and it keeps public officials on their porcine little trotters. In fact, it should be easy to compile this as all public sector jobs are advertised by ASEP and in the Careers section of most of our main dailies.

Well, a man can dream.

SQUIRM PIGGIES!