Eurozone to prepare for Greek exit

myp · May 23, 2012

Each Eurozone nation is going to be coming up with a plan to handle a Greece exit. It is going to be interesting to see how this works and whether capital flow restrictions will need to be used.

The Euro might just leave Greece before Greece leaves the Eurozone as we've already started to see.

http://www.reuters.com/article/2012/05/23/us-eurozone-greece-idUSBRE84M0P420120523

Joshy · Jun 5, 2012

This will be interesting.

The GMan · Jun 5, 2012

Can see this becoming a first step in the dissolution of the Euro. When one country leaves, the rest will look to see the pros and cons of remaining in the alliance.

With how Greece is now, I truthfully don't see the country becoming prosperous again in under 3 years. There's just too much debt and bad deals that have been written. To just wipe out every debt owed will make things easier but it will set a very bad precedent.

myp · Jun 12, 2012

The GMan said:
Can see this becoming a first step in the dissolution of the Euro. When one country leaves, the rest will look to see the pros and cons of remaining in the alliance.

Exactly. Greece itself is not a problem. It is what happens when it becomes clear that the Euro is not as permanent as once thought to be. Before other countries do anything, the markets will act (more so than they already are) to move Euros out of the periphery and into Germany, Finland, etc.

The GMan · Jun 13, 2012

And add onto that any loss of the stability of the economy around Europe will ripple out to the rest of the world. When the euro begins its decline into something less than what the US dollar is currently, things will become very chaotic. There will be a run on people converting their euros into local currency before the bottom falls out.

reader · Jun 15, 2012

I don't think Greece will leave Euro, but they will try everything to alleviate the bailout terms after the election.

clax · Jun 15, 2012

I think the only way to balance out economy is to apply it to something real. We say so isn't a real economy. By which i mean the euro has no value, other than the promise by the government that it is valuble it has no leg to stand on.

myp · Jun 15, 2012

clax said:
I think the only way to balance out economy is to apply it to something real. We say so isn't a real economy. By which i mean the euro has no value, other than the promise by the government that it is valuble it has no leg to stand on.

The Euro has plenty of value- that's the problem for countries like Greece.

clax · Jun 15, 2012

It has no value other than what is promised by the government.
The only currency that has value is based in gold. Euro is worthless paper.

myp · Jun 15, 2012

clax said:
It has no value other than what is promised by the government.
The only currency that has value is based in gold. Euro is worthless paper.

Simply not true. The market still values the Euro right now. What the Greeks need given their fiscal situation is inflation now and they are not getting it. Also, gold is only valued also because the market values it, not because there is something inherently special about it.

clax · Jun 15, 2012

myp said:
Simply not true. The market still values the Euro right now. What the Greeks need given their fiscal situation is inflation now and they are not getting it. Also, gold is only valued also because the market values it, not because there is something inherently special about it.

Incorrect, gold is valuble because it is rare, the euro is like monopoly money. Only valuble because the game says it is.

Ask anyone what they would rather have 1000 euros worth of gold, or 1000 euros?

Only a fool would take the euros

myp · Jun 15, 2012

clax said:
Incorrect, gold is valuble because it is rare,

That's simply not true. There are plenty of rare things in this world that are not valued by the market at large.

clax said:
the euro is like monopoly money. Only valuble because the game says it is.

Again, not true. It is valuable because people believe in it. But that is true of anything. Value is subjective.

clax said:
Ask anyone what they would rather have 1000 euros worth of gold, or 1000 euros?

Ask them now or could I have asked them 5 years ago? There is currency risk with the Euro right now, although I am sure there are still some holding long positions on it even now, especially if the assets are in a core nation.

clax said:
Only a fool would take the euros

Value is subjective. Maybe you are the fool for not taking euros when everyone else for the most part is still okay with them

clax · Jun 16, 2012

myp said:
That's simply not true. There are plenty of rare things in this world that are not valued by the market at large.

Again, not true. It is valuable because people believe in it. But that is true of anything. Value is subjective.

Ask them now or could I have asked them 5 years ago? There is currency risk with the Euro right now, although I am sure there are still some holding long positions on it even now, especially if the assets are in a core nation.

Value is subjective. Maybe you are the fool for not taking euros when everyone else for the most part is still okay with them

their currency is at greater risk now, money based on gold is harder to inflate, because you cant print mor gold and devalue the gold that is out there. Where if you print money and back it up with nothing it inflates above and beyond all capacity. Because if there are 50 million pennys or wuros or what ever they are worthless.

If fake currency is so much better than gold standard, why has it inflated over 1500% sence we left it behind.

Gold doesn't ever change in value, at least not in your, your mother's or your Grandmothers lives. The dollar has weakened to the point where it was once five dollars an ounce to i think 1400 dollars an ounce. That is the dollar loosing value not the gold gaining it.

Maintaining equal value for 200 years, verses inflating 1000% in fifty years, seems the winner is gold, but then again most people would want Gold over paper.

myp · Jun 16, 2012

clax said:
their currency is at greater risk now, money based on gold is harder to inflate, because you cant print mor gold and devalue the gold that is out there.

Gold can be very volatile. It is subject to speculation too and can be manipulated easier than a currency due to the mostly set quantity.

clax said:
Where if you print money and back it up with nothing

If you think currencies like the USD and Euro are backed by nothing, then so is gold. Both have value only because the market gives it that value.

clax said:
If fake currency is so much better than gold standard, why has it inflated over 1500% sence we left it behind.

What is fake currency? And what has inflated 1500%?

clax said:
Gold doesn't ever change in value, at least not in your, your mother's or your Grandmothers lives.

Actually it does. All the time. Check out the real value of gold over even a week and it will change.

clax said:
The dollar has weakened to the point where it was once five dollars an ounce to i think 1400 dollars an ounce. That is the dollar loosing value not the gold gaining it.

Why are you valuing the dollar against one asset? The asset is subject to supply and demand. "Inflation is always and everywhere a monetary phenomenon."

clax · Jun 16, 2012

Gold value doesn't change, the dollar dose. In 1890 you could use a 20 dollar gold piece to by a fine suit, now they cost about 1200 dollars, same with gasoline, the price hasn't gone up the dollar is inflated. In 1964 you could get a gallon of gas for a quarter roughly, a quarter now is worth 3.75 dollars. The only reasonable conclusion is that the dollar moves. .25 to 3.75 is approx 1200% inflation. And that is the dollar, the euro is inflating faster. Sence it was adopted in 1999 it hs gone from trading at 1.60 to 1.24. And that is because the politicians print more to pay their debt, and tht devalues it.

Gold "speculation" is people trying to figure out what the dollar is doing.

Your statement that things only have value because people say it does, is true but people have been saying gold has value all through history, currency comes and goes.

It is fake because it is only floating on the concept that it is valuble. But the more you print, the less value it has. You can't print more gold period, it is a better money system.

myp · Jun 16, 2012

You can't keep saying the value of gold does not change value and just expect it to become true. http://goldnews.bullionvault.com/files/real_gold_price_2.png How do you explain that?

The Fed targets a 2% inflation rate- it is supposed to inflate. Might not be the ideal in a fantasy world, but in the real world a low inflation target is probably the best target.

clax · Jun 16, 2012

myp said:
You can't keep saying the value of gold does not change value and just expect it to become true. http://goldnews.bullionvault.com/files/real_gold_price_2.png How do you explain that?

The Fed targets a 2% inflation rate- it is supposed to inflate. Might not be the ideal in a fantasy world, but in the real world a low inflation target is probably the best target.

Value of the dollar changing

myp · Jun 16, 2012

clax said:
Value of the dollar changing

That is in real terms. In other words, adjusted for inflation.

clax · Jun 16, 2012

myp said:
That is in real terms. In other words, adjusted for inflation.

46 ounces of gold bought a sensable sedan in the 1950s, 46 ounces of gold can buy a sedan today. That means gold has the same buying power over the past 60 years. That means it is more stable.

Inflation of the dollar, not gold

clax · Jun 16, 2012

myp said:
That is in real terms. In other words, adjusted for inflation.

Exactly. Dollars and other such fake money, inflates gold dose not. Gold is more stable

Eurozone to prepare for Greek exit

Similar threads