This is how I reacted recently, in a rather visceral way, to what I saw as rank injustice in Greece. First, a contextualising quote from Wikipedia; second, my reaction:
The 1997 Asian financial crisis began as the property bubble in the Far East began to burst in Thailand, causing large financial losses in those countries that greatly affected foreign investors. While Bill Clinton was preoccupied with the Monica Lewinski scandal, Robert Rubin took control of foreign policy and forced loans onto the affected countries. However, after each country agreed to IMF bailout loans, foreign investors immediately withdrew their money, leaving the tax payers with enormous debts and triggering massive economic disasters.
Perhaps Greece is not so much a foretaste of things to come as a reminder of things that have gone.
Daylight robbery is what this is really all about. A daylight robbery which channels the livelihoods of ordinary folk into the pockets of the rich and undeserving. Greece may not be a case of a property boom gone bad – but it is most definitely an example of a wealthy world which doesn’t know how to function on behalf of the opportunities and welfare of the majority. And there the parallels are absolutely in sync.
And this is what the Guardian reports today (via a tweet from zopalok and another here) on the subject – again – of what are clearly looking to be big-time speculators (the bold is mine, and you have to be very eagle-eyed to even alight on what the paper seems to see as a throwaway line of little importance):
Steven Major, global head of fixed income research at HSBC, warned that events in Greece could have far-reaching consequences if they are not controlled. “It matters to the UK economy,” he said. This is because a default by Greece or a renegotiation of a bailout could be taken as a signal by the Irish and Portuguese governments to alter their own bailout terms: “This is why it starts to matter. The UK has very little exposure to Greece, tiny exposure to its bonds and the inter-bank market. But the UK has much larger exposure to Ireland and Spain.” He added that some speculators were hoping to profit from a default.
Meanwhile, from the same story, we have further confirmation that the oxymoron of brilliantly clever financial idiocy leads to results which no one – right now – knows how to predict (again the bold is mine):
Danny Gabay of City consultancy Fathom said the major concern for central bankers if the chaos in the eurozone deepens is banks’ indirect exposure to it through complex financial products such as credit default swaps.
“We have absolutely no idea where this is going to end until somebody pulls the plug,” he said. “I don’t know what the FPC can possibly do about this: there are no levers we can pull except ‘sell, sell, sell’, but who’s going to buy?”
Great stuff, ain’t it? And there was I, feeling bad for acting all emotional, as I argued that in the case of Greece the world’s financial institutions would be looking to allow their friends in high places to bail themselves out before finally shutting up shop.
But isn’t now exactly the time we should be using our emotions? Isn’t now precisely the time we should be aware of how this is going to affect ordinary blameless working people?
And if it isn’t, then tell me why I’m wrong – and explain clearly the alternative.
Further reading: this article appears to suggest the black economy is part of the problem. I would suspect, knowing as I do quite intimately Spanish culture and its mores, that, for the Greeks, their black economy has been part of the solution. The real issue may lie more at the feet of a system of government which has rarely functioned fairly. The black economy is therefore a simple mechanism used by ordinary men and women for dealing with systemic injustice. But I may be wrong.