That shot at 3:43 created an optical illusion for me causing me think the depth was inverted (the way those inverse/hollow reliefs appear to continuously follow your point of view; I'll link if you don't know what I'm talking about).
Anyway, if you can get your eyes to do, quite trippy. It made the river look as though it were perfectly balanced on a long ridge, with the forest falling away down sharp cliffs on either side. I think my eyes were focused on the river at the time.

Can't tell if you were joking, but it seems entirely fake, so... maybe that's some relief?

Obviously it still represents some people in reality, but I think this was just a stupid staging for the sake of amusing people at the expense of someone's awkwardness.

oh no ... I hadn't thought of that.

He's fortunate to be so multi faceted. And, as he indicated, he has a boatload of comedic relief from all of the people he knows. That will certainly come in handy [oops, sorry] utilizing the 'laughter is the best medicine' theory.

What a shitty summer break, huh?

Varoufakis' Op-Ed in the Guardian closes with a remark that should be featured much more prominently in any discussion about the EU or the EZ:

"Based on months of negotiation, my conviction is that the German finance minister wants Greece to be pushed out of the single currency to put the fear of God into the French and have them accept his model of a disciplinarian eurozone."

It is about the Franco-German dynamic within the EU and whether or not the monetarists in Germany -- the recession cult, as Bill Mitchell put it -- get to keep the rest of the EU in a permanent chokehold.

God knows what he could be hiding under that hat, another assault rifle, hand grenades, his relief.

From the files of Police Squad.

*related=http://videosift.com/video/The-Sound-of-Relief-The-Naked-Gun

The Sound of Relief - The Naked Gun has been added as a related post - related requested by Grimm.

Holy crap. Horrible what's happened and happening to the natives there.

Just brings to mind what I just saw on Vice the other night about how the $10 billion that was donated toward relief for the quake in Haiti and how that was a big money grab for developers who used the money to build soccer stadiums and zero homes, and all the people who were affected by the quake are still homeless with no electricity or plumbing, dying of cholera.

Makes donating seem like a bad idea.

Your video, Stephen Hawking Little Britain Comic Relief Sketch, has made it into the Top 15 New Videos listing. Congratulations on your achievement. For your contribution you have been awarded 1 Power Point.

Wall of text incoming. Again.

Sorry. Again.

tl;dr:

Debt relief right away was proposed, was neccessary, and was skipped to protect the European financial system.



You are 100% correct, we both are as convinced as one can be that a disorderly collapse would have been much worse for Greece. Might have turned it into a failed state, if things went really bad.

But the situation in Greece at the time the Troika got involved suggested a textbook approach would work just fine. Greece was insolvent, no two ways about it. A debt restructuring, including a haircut, was required to stabilise the system. Yet it was decided against it, thereby creating an enormous debt bubble that keeps growing to this day, destabilising everything.

Why?

People in Brussels, Frankfurt and Berlin knew in May of 2010 that Greece cannot service its current debt, nevermind pay it back. I remember rather vividly how it was presented to us, as it stirred up a lot of dust in Germany. They pretended as if the problem was a shortage of liquidity, even though they knew it was in fact an insolvency. And to provide an insolvent nation with the largest credit in history (€110-130b) is... well, we can all pick our favorite in accordance to our own bias: madness, idiocy, incompetence, a mistake, intent. They threw Greece into permanent indebtedness(?), and also played one people against another. People in Germany were pissed, still are. Not at the decision makers, but the Greek people.

Again, why?

Every European government, pre-crisis, drank the Cool Aid of deregulation, particularly with regards to the financial sector. When the crisis hit, they had to bail out the banks, a very unpopular decision in Germany, given the scandalous way it was done (different story). Like I pointed out before, when Greece was done for, German banks were on the hook for €17b+, and the French for €20b+. So no haircut for Greek debt.

It gets even better. The entity most experienced in these matters is, of course, the IMF. But IMF couldn't get involved. Its own regulations demand debt to be sustainable for it to become involved in any debt restructuring. Strauss-Kahn had the rules changed in a very hush-hush manner (hidden in a 146 page document) to allow the IMF to lend vast sums to Greece, even though they knew it would not be payed back. Former EC members are on record saying the Strauss-Kahn decided to protect French banks this way as a part of his race for President in France. So they changed IMF rules and ignored European law to bail out German and French banks, using the insolvent Greek government as a proxy.

Several members of the IMF's board were in open opposition. The representatives of India, Russia, Brazil and Switzerland are on record, saying this would merely replace private with public financing, that it would be a rescue package for the private creditors rather than the Greek state. They spoke out in favor of negotiations of a debt relief.

And if that wasn't bad enough, there's an IMF email, dated March 25th, 2010, that was published by Roumeliotis, formerly IMF. They put it very bluntly:

"Greece is a relatively closed economy, and the fiscal contraction implied by this adjustment path, will cause a sharp contraction in domestic demand and an attendant deep recession, severely stretching the social fabric."

Even the IMF, who chose parameters according to their own ideology, thought the European program to be too severe. That's saying something.

All that is just about the initial decision. The implementation is another story entirely, with unelected and unaccountable bureaucrats telling a democratically elected government what to do. There are former Greek ministers on record, telling how Troika officials basically wrote legislation for them. Blackmail was common, bailout money held as leverage. The Memorandum of Understanding was to be followed to the letter, and the Troika program was as detailed as a government program, so they really had their hand in just about everything.

The specifics of the program are a discussion of their own, with all the corruption going on. The Lagarde list (2000+ Greek tax dodgers) was held in secret by order of an IMF official – that alone should trigger major investigations. The nationalisation and sell-off of the four largest Greek banks, or the no-bid sale of the Hellenikon area to a Greek oligarch – all enforced by Troika officials.

The haircut of 2012, ~€110b wiped out, came two years late. As a result, it didn't hit any German or French institutions in a serious way. Most of the debt was in the hands of these four largest Greek banks -- NBG, Piraeus, Euro, Alpha – who subsequently had to be recapitalised by Greece to the tune of €50b. Cut by 110, up by 50 right away. Banks were nationalised and shares later sold again, at 2/3 the price. Lost another €15b, because the Troika demanded the sale to appease the markets.

The legal aspects of all this are nightmare-inducing as well. They violated numerous European laws, side-tracked parliaments, used governmental decrees, etc.

Let me just say this: when they forced Cyprus to give away two banks' branches in Greece for a fraction of their worth, Cyprus lost €3.5b, at a GDP of €17b, and those two banks went belly-up. It was pure blackmail, do it or you're out. Piraeus Bank received those €3.5b, and its head honcho had €150m of personal bad credit wiped clean right then and there, all at the command of the Troika. Those €3.5b had to be taken from ordinary folks by "suspending" the deposit insurance, perhaps the most stupid decision they had made so far.

Why did they do it? Because Greece was more important than Cyprus, and Cypriot banks were involved in shady deals with Russian oligarchs. Still illegal, and massively so.

Edit: I cut my post in half and it's still too long.

Unfortunatly, it's not just Merkel and her cabinet. It's the press, it's the economics departments at universities, it's politicians at all levels. Call it an economic nationalism, hell-bent to defend what they know to be the moral way of doing business. Everything left of this special flavour of market fundamentalism has been systematically attacked and suppressed for at least 30 years.

For instance, our socialist party, still referred to as the fringe of what is acceptable, runs on what is basically a carbon-copy of social-democrat programmes from the '70s. Similar to the British Green Party and Labour. Krugman, Stiglitz, Baker, Wolff, DeLong -- they'd all be on the fringe in Germany. Even the likes of Simon Johnson (IMF) or Willem Buiters (City Group).

If you speak out in favour of higher inflation (wage growth) to ease the pressure on our brothers and sisters in southern Europe, you'll be charged with waging a war against German saver. "You want to devalue what little savings a nurse can accrue? Don't you support blue collar workers?"

The same blue collar workers have been stripped of their savings by 15 years of wage suppression, the same blue collar workers are looking at poverty when they retire, because the PAYGO pension system was turned into a capital-based system that only works to your benefit if you never lose your job, always pay your dues and reach at least age 95. The previous system survived two world wars without a problem, yet was deemed flawed when they realized how much money could be channeled into the financial system – only to disappear at the first sight of a crisis, eg every five to ten years.

Similarly, you could point out that a focus on trade surpluses might not be the greatest of ideas, given the dependence it creates on foreign demand, a weak currency and restricted wage growth domestically. But they'll call you a looney. "The trade surplus is a result of just how industrious our workers, how creative our scientists and how skilled our engineers are. It's all innovation, mate! Are you saying we force the others to buy our stuff? That's madness."

You simply cannot have an open discussion about macroeconomics in Germany. Do I have to mention how schizophrenic it makes me feel to read contradictory descriptions of reality every day? It's bonkers and everyone's better off NOT reading both German and international sources on these matters.


Any compromise would have to work with this in mind. They'd have to package in a way that doesn't smell like debt relief of any kind. People know that stretching the payment out over 100 years equals debt relief, but it might just be enough of a lie to get beyond the level of self-deception that is simply part of politics. If they manage to paint Varoufakis' idea of growth-based levels of payment as the best way to get German funds back, people might go for it. Not sure if our government would, but you could sell it to the public. And with enough pressure from Greece, Spain, Italy, and France most of all, maybe Merkel could be "persuaded" to agree to a deal.

As for Syriza's domestic problems: it's a one-way ticket to hell. Undoing decades of nepotism under external pressure, with insolvency knocking on your door? Best of luck.

Italy is hard on Greece's heels in terms of institutional corruption. Southern Italy, in particular, is an absolute mess. Given the size of the Italian economy, Syriza better succeed, so their work can be used as a blueprint. Otherwise we're going to need a whole lot of popcorn in the next decade...


Edit: Case in point, German position paper, as described by Reuters. As if the elections in Greece never took place.

+ a central bank whose mandate is limited to inflation
+ the lack of a treasury
+ the lack of a harmonized tax system
+ the crippling deficits in democratic control that make it very hard to turn the will of the people into policy
+ etc

The last point is of particular interest if you look at Greece as a shock & awe induced suspension of democracy. Many nations are held in a permanent state of emergency through the war on terror, while Greece's permanent state of emergency was imposed through debt.

Previous governments did what they were told by troika officials, with parliament left aside and judicial decisions left ignored. The return of democracy into some parts of the system caused rather vicious reactions from both the press and European officials. Just look at what Martin Schulz or Jeroen Dijsselbloem said about Syriza officials in the last few days.

Debt is a tool powerful enough to suspend democracy in a heartbeat, even quicker than our famous war on/of terror.

Parliamentary decisions are superceded by transnational treaties and obligations. And if you take the thought one step further, you end up at TTIP/TTP/CETA/TISA. If Greece demonstrates that democratic decisions at a national level still overrule transnational treaties, governments lose a scapegoat for unpopular decisions ("treaty X demands it of us"). Should Syriza manage to end the state of emergency, to return control over the decision back to the elected bodies, it will become infinitely harder to impose draconian or even just highly unpopular measures.

But I digress. Twin Euro blocks (South/North) were part of the discussion, just like parallel currencies in troubled nations. A German exit is still being discussed as well, but I don't think its advocates within Germany thought it through. Switzerland just uncoupled its Swiss Francs from the Euro and it did a real number on their exports. A new DM would appreciate like a Saturn V, instantly shattering German exports. Without a massive increase in wages to compensate through domestic demand, Germany would bleed jobs left, right and center. A fullblown recession.

I'd say it would take very little to stabilise the union, even in its currently flawed configuration. Krugman had a piece this morning, calling one of Syriza's core demands reasonable. And judging by what I have read over the last five years or so, it is. He said Germany would be crazy if they demanded payment on full, no reliefs. And that's where it shows that he cannot follow the media or the political discussions in Germany to any meaningful degree, language barrier and all. Public discussion on economics in Germany stands completely separate from the rest of the world.

Ignorance, stubbornness, cultural bias, a feedback-loop of media and politics, group pressure -- we have everything. And the fact that Germany has been comparatively successful in the face of this crisis makes it practially impossible to pierce this bubble. We're doing fine, our way must be correct, everyone else is wrong.

@RedSky

The need to be kept afloat by European funds is pretty high on the list of things Syriza is keen to do away with. Varoufakis was clear on this pretty early on, at least 2009 as far as I know. They treated it as a problem of liquidity instead of a problem of insolvency, and therefore any funds funnelled into Greece were basically disappearing down a black hole. They are bleeding cash left, right and center, and the continuous flow of credit from Europe doesn't help a bit in its current form.

As of now, they can't pay shit. Any additional credit has to be used to pay back interest on previous credit. Their meagre primary surplus is less than their interest payments. With that in mind, some of the ideas floating around sound rather intriguing, especially given the horrendous failure all the previous agreements have produced. These ideas include: cap interest payment (1.5% of primary surplus), use the rest for investment or humanitarian relief; no payments on debt below 3% growth, 50% of agreed upon payments at 3-6% growth, full payments at 6+% growth.

Yet even those ideas are purely theoretical, because there is no growth in Greece. The celebrated growth in Q3 2014 of 0.7% might very well be a fluke, as Bill Mitchell described here (prices falling faster than incomes). For Greece to be able to have any meaningful growth, they'd require not just a complete reconstruction of its institutions (structural reforms), but also massive investment.

And there's where it breaks down again, since you rightfully pointed out that the Germans in particular won't spend a dime on Greece, especially not with investment in Germany in equally dire shape (shortfall of about a trillion € since 2000).


Which brings me to another point: Germany vs France.

Productivity in both countries was en par in 1999, and productivity in France in 2014 was only slightly below German numbers. "Living within your means" is a very popular phrase in the current discussion, which basically means living in accordance with your productivity.

Subsequently, there should be a similar development of unit labour costs within a monetary union, with growth targets set by the central bank. In our case, that would be just below 2%. Like I've previously said, Greece lived beyond its means in this regard, and significantly so.

But what about France and Germany? The black line marks the target, blue is France, red is Germany. That's beggar-thy-neighbour. That's gaining competetiveness at the cost of your fellow Euro pals. That's suppressing domestic demand in order to push exports.

German reforms killed its domestic market (retail sales stagnant since early '90s) and created an aggregate trade surplus to the tune of 2 trillion Euros. That's 2 trillion Euros of deficit in other countries. And we're looking at an additional 200-210 billion Euros this year. If running trade deficits is bad, so is running trade surpluses.

Ironically, there's even been legislation in Germany since 1967, instructing the government to balance its books in matters of trade (and other areas). They've been in violation of it for 15 years.

With this in mind, everytime a German politician calls for the other countries to run trade surpluses just like Germany, I get furious. Some of them, on the European level, even have the audacity to say that everyone should run trade surpluses, and all it takes to get there is massive wage cuts. That's open lunacy and a failure of basic math. No surplus without deficits, no savings without debt.

And while we're at it, it's not the savings rate in Germany that bothers me. It's the moral superiority that is being ascribed to running surpluses in every way imaginable. Every part of society is expected to have a positive savings rate, because debt is bad. Well, if everyone's saving and nobody's accruing the corresponding debt, you get the current situation where there is no investment whatsoever, a gargantuan shortfall in demand given the national productivity, and a cool 200 billion Euros of debt a year that foreign actors have to rake up so that Germany can have its massive growth of 0.5-1.5% annually.

Finding borrowers for all that cash is getting more difficult by the day. The ECB's QE is basically one big search for new borrowers, since everyone either doesn't want to borrow or cannot borrow anymore.

If Germany wanted to help the Eurozone, they'd start by increasing their ULC vis-á-vis the rest of the countries. Competitiveness should be regulated through the foreign exchange rate, not this parasitic race to the bottom within the zone. Ten years of 4% increase in wages, annually. That ought to be a start.

Additionally, allow the ECB to fund the European Investment Bank directly, instead of this black hole of QE.

Or go one step further and seriously consider Varoufakis' ideas, including the old Keynesian concept of a global surplus recycling mechanism.

But all that is pure fantasy. I don't think a majority of Germans would support either of these measures, not with the overwhelming fear of inflation this society has. Add the continuous demonisation of debt and you get a guarantee that very few countries might be compatible to be in a longtime monetary union with Germany.

It's going to be cheesy as hell, but I'm hoping Die Antwoord are there for a bit of light relief. Unfortunately I think they might end up taking themselves a bit too seriously and it'll just be another movie. There's so, so much borrowed from elsewhere though, it's got to be a parody.

Please let it be a parody...