Archive for June, 2011


June 28th, 2011 No comments

Ilargi at The Automatic Earth writes about the Greek Debt situation:

Tanks in the street of Athens, and people throwing themselves out of windows. It’s come to this kind of threatening language, and in the next 48 hours or so it will only intensify, and financial markets will fluctuate because of it as if that’s their very and only purpose in life.

The words about the tanks and suicides come from one of Greece’s newly fangled fat twin political duo, Theodoros Pangalos, the deputy prime minister who appeared out of nowhere the past few days, as far as that is physically possible for someone his size.

Look, I’m not trying to make fun of fat people here, it’s just the irony that the fact that the “face” of Greece in the international financial media has overnight changed to these two huge guys that no-one outside of the country had ever heard about before. And that they’re the ones threatening the Greeks with hell and brimstone if they don’t agree to austerity measures that will make a substantial part of the population go hungry. “We all have to tighten our belts now”, that sort of thing. Well, those are quite some belts to tighten.

"it's as big as a whale, and it's about to set sail!"

Wow.  Looks like, for austerity measures, they could start with “think globally, act locally.”

While entertaining, why does this affect us (Americans, that is)?  Read on:

But yes, do ask yourself: what do you think would happen in New York, LA, Atlanta, Chicago, if those Greek austerity measures mentioned above would fall on the doorsteps of your community? Same question for those of you living in London, Berlin, Amsterdam, Montréal.

Maybe this is a good time to speak up. At least now you still can. Once there are tanks in the streets, that may prove to be not so easy anymore. Look, Greece is not the worst of the lot, or the biggest issue. As Jon Stewart pointed out last week, Greek debt amounts to some $44,000 per capita. In America, it’s $45,000.

We’re all in this together, believe it or not. US banks have exposure to Greece through credit default swaps to an extent that nobody can define. We do know, though, that it’s substantial. And that if the Greek austerity vote fails on Wednesday, those US banks will come looking for more bailouts. From a government that can’t even agree on a debt ceiling, because the debt is so monstruously high already there is no way out anymore.

I doublechecked — the quoted number is low.  As of today, the per-capita share of the U. S. debt is $46,027.83 (direct from the Treasury divided by the Census).

It’s also fun to compare Greek vs. U.S. unemployment numbers, but for right now, I will leave that as an exercise for my readers…