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On February 15 2012 09:59 DeepElemBlues wrote:Show nested quote +I think basically the western democracies fail to properly tax their rich people. Instead they raise debt to finance polity and social systems. This can only work if you lower debt by substantial inflation (US does this, Europe can't). I'm sure this has been pointed out before, but even taxing the rich at a 100% rate would not come anywhere near close to fixing the West's debt problems. Even if you taxed all their income at 100% and seized and sold all their assets it wouldn't work - who would have the money to buy those assets? And if you tax "the rich" and "corporations" at a confiscatory tax rate, what would that do to the economy? The only solutions that would actually work would be severely raising taxes on the rich and the middle class, or severely cutting spending, or somewhat less severely cutting spending while somewhat less severely raising taxes on the rich and the middle class. Raising taxes on the middle class, severely or not, is not politically tenable anymore and neither is severely (or not) cutting spending.
Proper taxing would not be able to "fix" the debt problems created in 30+ years, but proper taxing (and ofc not letting buerocracy and social systems grow too much) would be able to balance the income of a country. It is not true you need 100% to achieve this.
Government debt is rised by issuing bonds. Who buys those bonds ? At the very end "Rich" people (Directly or indirectly). So basically instead of raising government "income" by taxing, government rises the money via bonds. Problem: you have to pay interest on those.
If the government is able to sell billions of bonds, it actually takes away money from economic activity, so if the same amount of money would be taken via taxing, it would make no difference regarding purchasing power/economy.
I am by far not a socialist, however it is obvious the current model permanently creates imbalances leading to kind of a big crash some day (not the end of the world, but maybe avoidable?).
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Somehow we have reached the point to wonder. Is it better to sit on our knees and let the banks FUCK us for like 10 years at least? Or is it better to leave euro and go back to stone age? For the past years i worked every day. Like millions of others. Payed my taxes. Payed my bills. Everything seemed ok. Then one day our retarded politicians say, you know what? We kinda fucked up bad and we need to reduce your salary to 500 euro / month. So you will earn 500 and pay 400 for your house rent. 250 for power and water. WE , people say. Hey you retard we cant live like that. Politicians say: nothing we can do about it. Either that or chaos. I am considered lucky since i still have my job. 1 out of 5 people has no job. 1 out of 2 people under 30 years old has no job. So you guys better watch out. Many countries will follow. You wont believe how fast you go down and i hope noone else lives what greek people live right now.
ps
There is no way we are going to sell our islands. I 'd rather die from starvation than give to germans what my grandfather killed them for. So dear Angela Merkel , Hitler is waiting you in hell 
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On February 15 2012 11:11 Voldron wrote:There is no way we are going to sell our islands. I 'd rather die from starvation than give to germans what my grandfather killed them for. So dear Angela Merkel , Hitler is waiting you in hell
I don´t really see how that is an appropriate response towards germany or Merkel(and by god I do not like her).
YOUR politicians that YOU elected led YOU and YOUR people into this mess, feeding YOU lies and YOU were too content to see how the house step by step caught fire. I only can imagine how angry you must be - and you got every right to be. But you have to say yes - WE fucked up so how do we want to approach this problem now. It´s hard but the only way despite the hardships(read the other day that greek kids do not get enough food that they even pass out during classes because their families cannot provide for them, in addition to that suicide rates of family fathers increased dramatically... just fucked up) You either get out of the eurozone and stay a sovereign nation or you let others decide over your finances(IMF/EU/"Germany" - that´s what it has come to. There is no third way.
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On February 15 2012 11:11 Voldron wrote:Somehow we have reached the point to wonder. Is it better to sit on our knees and let the banks FUCK us for like 10 years at least? Or is it better to leave euro and go back to stone age? For the past years i worked every day. Like millions of others. Payed my taxes. Payed my bills. Everything seemed ok. Then one day our retarded politicians say, you know what? We kinda fucked up bad and we need to reduce your salary to 500 euro / month. So you will earn 500 and pay 400 for your house rent. 250 for power and water. WE , people say. Hey you retard we cant live like that. Politicians say: nothing we can do about it. Either that or chaos. I am considered lucky since i still have my job. 1 out of 5 people has no job. 1 out of 2 people under 30 years old has no job. So you guys better watch out. Many countries will follow. You wont believe how fast you go down and i hope noone else lives what greek people live right now. ps There is no way we are going to sell our islands. I 'd rather die from starvation than give to germans what my grandfather killed them for. So dear Angela Merkel , Hitler is waiting you in hell
I am reading international financial press on a daily base. Overseas it was always common sense to
"If you gonna default, default fast"
For greece people a fast default would have been the best. All the "help" packages basically were designed to avoid widespread bank failures.
IMO greece has failed by reckless lending, however financial institutions have the responsibility to not lend money to heavy indebted countries. Both have failed, both should have suffered the consequences. All the delay and "help" packages just made the situation worse. The faster greece can start over, the better for greece and in the very end for europe.
However a default likely would lead to similar wage cuts and cuts in social spending as no proposed by the EU.
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On February 15 2012 21:28 Schnullerbacke13 wrote:Show nested quote +On February 15 2012 11:11 Voldron wrote:Somehow we have reached the point to wonder. Is it better to sit on our knees and let the banks FUCK us for like 10 years at least? Or is it better to leave euro and go back to stone age? For the past years i worked every day. Like millions of others. Payed my taxes. Payed my bills. Everything seemed ok. Then one day our retarded politicians say, you know what? We kinda fucked up bad and we need to reduce your salary to 500 euro / month. So you will earn 500 and pay 400 for your house rent. 250 for power and water. WE , people say. Hey you retard we cant live like that. Politicians say: nothing we can do about it. Either that or chaos. I am considered lucky since i still have my job. 1 out of 5 people has no job. 1 out of 2 people under 30 years old has no job. So you guys better watch out. Many countries will follow. You wont believe how fast you go down and i hope noone else lives what greek people live right now. ps There is no way we are going to sell our islands. I 'd rather die from starvation than give to germans what my grandfather killed them for. So dear Angela Merkel , Hitler is waiting you in hell I am reading international financial press on a daily base. Overseas it was always common sense to "If you gonna default, default fast" For greece people a fast default would have been the best. All the "help" packages basically were designed to avoid widespread bank failures. IMO greece has failed by reckless lending, however financial institutions have the responsibility to not lend money to heavy indebted countries. Both have failed, both should have suffered the consequences. All the delay and "help" packages just made the situation worse. The faster greece can start over, the better for greece and in the very end for europe. However a default likely would lead to similar wage cuts and cuts in social spending as no proposed by the EU.
I am not so sure that EU is stupid in drawing out the inevitable. I see it as a way to give the financial institutions with Greek bonds time to avoid a sudden collapse. At the same time a complete default in modern times like in Argentina has started to change towards: If you ever get to hold money in the future the former creditors will start pressuring for payment. It is not a complete wipe of the slate as some people think.
The greek politicians have been called naive and narrow-minded in their way of handling the economy by greek professors and a lot of european politicians, so it is also a lesson in anti-nepotism to actually force the politicians to think further than their voters.
I do think that the biggest problem is the government in Greece and their inability to cut down on the public sector. There are still a few ways to stop the disaster, but they are becoming more and more hypothetical. Taking a drastic cut in the public sector jobs and reducing salary for far more than the Trojka asks for seems like the only true way to do it. Either you crash and burn in hell for it with a GDP collapse or they start to stabilize. In the first situation, heck a default is inevitable and they have just proven it. In the second situation it will be an advantage over a complete default.
The way it is now is just a slow and inevitable suffocation of Greece because the politicians in the country are too narrowminded and the Trojka has zero idea about how to salvage the wreck. The "austerity is king" in european politics will claim a victim.
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On February 15 2012 11:11 Voldron wrote:Somehow we have reached the point to wonder. Is it better to sit on our knees and let the banks FUCK us for like 10 years at least? Or is it better to leave euro and go back to stone age? For the past years i worked every day. Like millions of others. Payed my taxes. Payed my bills. Everything seemed ok. Then one day our retarded politicians say, you know what? We kinda fucked up bad and we need to reduce your salary to 500 euro / month. So you will earn 500 and pay 400 for your house rent. 250 for power and water. WE , people say. Hey you retard we cant live like that. Politicians say: nothing we can do about it. Either that or chaos. I am considered lucky since i still have my job. 1 out of 5 people has no job. 1 out of 2 people under 30 years old has no job. So you guys better watch out. Many countries will follow. You wont believe how fast you go down and i hope noone else lives what greek people live right now. ps There is no way we are going to sell our islands. I 'd rather die from starvation than give to germans what my grandfather killed them for. So dear Angela Merkel , Hitler is waiting you in hell
I wish greece wasnt in the Euro so you had to solve this mess by yourself. Germany is trying to help you guys but they have conditions. If you dont want their help and think you can do it yourself then just leave the euro and stop blaming other countries for the mess YOU have created.
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Can someone explain to me why the european dept crisis is such a big issue, whereas the dept ratio in Japan and the USA is higher than in an average european country?? ... the USA is even making more and more depts in order to help their economy, while the euro-countries a about to decrease their depts...
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On February 12 2012 19:21 paralleluniverse wrote:Show nested quote +On February 12 2012 19:06 ETisME wrote:On February 09 2012 19:54 paralleluniverse wrote:On February 09 2012 19:44 ETisME wrote:On February 09 2012 18:42 paralleluniverse wrote:On February 09 2012 18:31 ETisME wrote:+ Show Spoiler +
Can anyone give me some big updates on the EU zone? I rarely read anything about it because it just isn't there on newspaper very much anymore.
Plus, I would actually prefer to listen to some locals' comments rather than some figures and the experts' "analysis".
As an undergraduate, I would totally say that empirical data, graphics, historical comparison usually don't really predict the consequences correctly at all.
They only really help in explaining what happened and economists can only try to fit a model and build a hypothesis around what might happen if they do this/that.
So you would rely on gut feeling instead of objective analysis?
A little thought:
EU and USA are like those old daddy billionaires. They were once very productive and grew rich, but USA didn't learn how to save what it has, spending on luxury goods and keep burrowing just to be able to live rich.
While EU is trying to include more kids into his family, even some who are shady and have a very different culture background and EU has to spent money trying to hold everyone together by controlling how much money each of them can get. When one was caught cheating and had to be saved, other cried unfair and wants some of those extra cash.
... http://www.bbc.co.uk/news/business-16301630http://www.bbc.co.uk/news/business-13798000 no, not gut feelings. But there are a lot of factors that only the locals can truly feel and provide. Economies don't really solely dependant upon government's policy and decisions, it's what the people react to it that really matters. It's a great way to feel how people react to their policy, how they think what should have been done, how big the disappointment/pleased by the policy. An example would be that Japan lowering their interest rate, hoping people would spent and invest to stimulate the economy but no one did that. It's a matter on how to approach the topic to be honest. Finance is similar, some people prefer buying stocks with graphs and numerical data, but some treat it as a business and study more than just numbers, including how people see the brands etc. Data can be biased and usually very hard to obtain an accurate one since there are tonnes of sampling methods etc. There will always be opposing theories, different theories attempting to explain the same effect etc. It's no wonder that a monkey can out-perform some professional investors I really dislike people treating economics with too much of mathematics and theories, just lacks that human side of it. It's like a game company trying to design the perfect fps games but didn't notice their target market doesn't really play any fps Economists are not mindless automatons who are disconnected from reality and can understand nothing but data. Analyzing something as complex as an entire economy with nothing but your subjective, narrow and confirmation biased view of the world is foolish. You act as if data cannot capture the effect of interest rate cuts on private investment. As a prime example of the folly of this approach, your statement on the European debt crisis is nonsense. the very basic assumption of Economics is wrong. It assumes humans act rationally. Analysing the economy does require to take in account of how people might react, especially their expectations. Economics is a social science, but too many people take it as a science. which comes to the recent rise of behavior economics and neuroeconomics, both of which tries to capture the human decision making more closely. Data can capture effects, sure. But there are tonnes of limitation and there are lots of methods trying to solve it. If you have done econometrics, you would know how much of the datas you are seeing are actually just collected and simplified to "factor A caused result A", omitting tonnes of other factors. And whether to omit those other factors sometimes can depends on the person who is doing the data analysis. Also, not to mention there are data that are not able to be quantified. Another example is the financial crisis, some economists knew there was a bubble in housing market but they didn't see it as huge as it was because they couldn't see how dangerous the repo market was when everything was repackaged and sold as a "better looking" product. If you think I am the only one to think this way, go read: http://www.ifw-members.ifw-kiel.de/publications/the-financial-crisis-and-the-systemic-failure-of-academic-economics/KWP_1489_ColanderetalFinancial Crisis.pdfOr go to the "control illusion" part of this website http://knowledge.wharton.upenn.edu/article.cfm?articleid=2234 http://www.nytimes.com/2009/09/06/magazine/06Economic-t.html?ref=paulkrugman
That was a very very interesting article.
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On February 15 2012 22:36 PlayX wrote:
Can someone explain to me why the european dept crisis is such a big issue, whereas the dept ratio in Japan and the USA is higher than in an average european country?? ... the USA is even making more and more depts in order to help their economy, while the euro-countries a about to decrease their depts...
It is more difficult for us Europeans because we work with different governments. The USA government can decide on their own to devaluate their currency while a country like Greece can't.
If the USA needs money, they just ask their accountant to add another 10 000 000 000 to the treasury. Devaluating the US dollar but at least they have money, this happened a lot in the past, hence the reason why 1 Dollar is worth 0,754 Euro currently. But in 2004 a dollar was worth 0,84 euro. And in 2001 it was close to 1*1.
Anyway, Greece needs money, but if they print more money then they devaluate the Euro, the currency also the German and Dutch are using. Europe can't allow sole countries to print more money to solve debts, while countries like the USA and Japan can just create money.
Europe has agreements on how much extra money can be created each year, if you need more money you need to loan it from the other countries, but countries like Germany, The Netherlands, Sweden, Norway simply won't risk to loan Greece, Italy and Spain money due to the high corruption and bad mentality.
It is of course much more complicated than that I describe, and maybe I am not 100% correct. But that is how I see it and how it was told to me.
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On February 15 2012 22:36 PlayX wrote:
Can someone explain to me why the european dept crisis is such a big issue, whereas the dept ratio in Japan and the USA is higher than in an average european country?? ... the USA is even making more and more depts in order to help their economy, while the euro-countries a about to decrease their depts...
Well the American debt is going to be a problem if investors belive that the US economy is going to contract and theyll be unable to repay their loans. At the moment the American economy is growing (slowly) and that increase their ability to pay back their debts. The European economy has been in a pretty poor condition recently so investors have doubted their ability to pay back their loans. This has lead to increased rates that further have worsned the situation for the countries involved. The lack of EU intervention and common leadership most likely worsned the crisis by a lot and maybe thats a part of the explanation to why it happend in the first place. Recently investors are possibly starting to regain their confidence in Europe?
Japanese debt is huge but its mostly self contained opposed to US and EU debt thats owned internationally. That means a Japanese crisis would mostly affect Japan and have a more limited impact on the world economy. On top of that it would be easier to regulate with taxation and other policies since the debts, central bank and the taxeable citizens etc are in a closed system.
This is my take on it at least. I guess someone will have a better and more accurate explanation. 
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On February 15 2012 22:36 PlayX wrote:
Can someone explain to me why the european dept crisis is such a big issue, whereas the dept ratio in Japan and the USA is higher than in an average european country?? ... the USA is even making more and more depts in order to help their economy, while the euro-countries a about to decrease their depts...
It's a difference in economic policy. Whereas the Americans grumble and groan about increasing debt, there's never really any doubt about it. As long as there are countries and/or banks willing to finance that increasingly gigantic debt, there is not really a problem.
However, imho (and note that I am not an economist) this is just another bubble being created: if you don't, at some point, stop spending more than you earn, you will run into the problem that people don't want to lend you money anymore. This has something to do with risk vs. reward, and some to do with trust. Argentina basically went bankrupt, because the IMF decided not to loan it money anymore unless it made extreme changes in its policy, which the politicians were unwilling/unable to do.
European economics follows this same train of thought and there is a strict upper bound for government debt in the Euro agreement. This has been let slide in recent years, because even Germany could not do this, but the general principle still holds: be frugal with your spending. That means that, unlike the US, where Obama was able to pump billions of dollars into the economy at the cost of national debt, European countries are cutting back spending.
As for the specific crisis: we're not talking about the average European country, we're talking about Greece and, more generally, the PIIGS countries: these are countries in which the economic crisis of 2008 hit disproportionately hard, because of bad governmental economics and a large reliance on the real estate market. Investors take one look at these countries and see the internal economy in shambles and a government unwilling/incapable of making policy changes. This results in interest rates on loans to such countries skyrocketing.
The problem is thus not so much the total amount of debt countries have, but the trust potential investors have in making a profit and of course, this offset against the risk they run in both situations. Most international investors couldn't give a shit about Greece going bankrupt, but if the US goes bankrupt they lose all the money they have already invested there.
EDIT: I just read Koshi's reply and he is of course, also entirely right. That is another conflating factor, which, btw, was also present in Argentina's crash: they had linked the peso 1:1 to the dollar, so also couldn't just devaluate their currency (or rather, they could, and did. The corralito was to prevent bank runs just before, and quite a bit after this devaluation)
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On February 15 2012 11:11 Voldron wrote:ps There is no way we are going to sell our islands. I 'd rather die from starvation than give to germans what my grandfather killed them for. So dear Angela Merkel , Hitler is waiting you in hell
What a sad amount of people(and apparently you aswell) don't get is that we wouldn't want to annex greece even if we could.
Why should we?
When we got East Germany back we had to build up the completely fucked up economy there too(we actually still pay taxes which go there to build it up although much of that money is actually used for other things today which many don't know) so why should we do something like that again?
Back then we did it to unite our people again, but today I really can't see how it could help us if greece would become a part of Germany.
Stop listening to stupid stuff like that in your media, Merkel surely DOESN'T want to annex greece and I haven't heard from any German yet that they'd like that(we didn't even think about that before stupid media and politicians made that up, and to be honest we still don't really think about it because that claim is just so rediculous).
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On February 15 2012 11:11 Voldron wrote:ps There is no way we are going to sell our islands. I 'd rather die from starvation than give to germans what my grandfather killed them for. So dear Angela Merkel , Hitler is waiting you in hell
This is the sort of way of thinking you should try to avoid at all cost atm.
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On February 15 2012 22:18 Robinsa wrote:Show nested quote +On February 15 2012 11:11 Voldron wrote:Somehow we have reached the point to wonder. Is it better to sit on our knees and let the banks FUCK us for like 10 years at least? Or is it better to leave euro and go back to stone age? For the past years i worked every day. Like millions of others. Payed my taxes. Payed my bills. Everything seemed ok. Then one day our retarded politicians say, you know what? We kinda fucked up bad and we need to reduce your salary to 500 euro / month. So you will earn 500 and pay 400 for your house rent. 250 for power and water. WE , people say. Hey you retard we cant live like that. Politicians say: nothing we can do about it. Either that or chaos. I am considered lucky since i still have my job. 1 out of 5 people has no job. 1 out of 2 people under 30 years old has no job. So you guys better watch out. Many countries will follow. You wont believe how fast you go down and i hope noone else lives what greek people live right now. ps There is no way we are going to sell our islands. I 'd rather die from starvation than give to germans what my grandfather killed them for. So dear Angela Merkel , Hitler is waiting you in hell I wish greece wasnt in the Euro so you had to solve this mess by yourself. Germany is trying to help you guys but they have conditions. If you dont want their help and think you can do it yourself then just leave the euro and stop blaming other countries for the mess YOU have created.
I know who has created this mess my friend. I realy like Germany and German people. Actually my girlfriend is half german. All you guys saying that germany had to build their economy etc its true. I am saying that yes WE fucked up ( meaning politicians of my country ) and prolly us people for voting them. I just hate Merkel. Its not because of the economy or anything related to money. Some months ago she asked as a solution to sell or part sell some of our small islands. Yesterday she supported FYROM to take the name Macedonia from us. These kind of comments are unacceptable. Loosing our money is one thing but selling our land and history is another.
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Zurich15355 Posts
On February 16 2012 05:21 Voldron wrote:
Some months ago she asked as a solution to sell or part sell some of our small islands.
No she did not. Don't believe what your media tells you.
Some unimportant 3rd row joke of a politician said that in an unimportant interview for Germany's worst tabloid, and of course, it was blown way out of proportion. No one in German politics who is taken seriously would suggest something as ludicrous.
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Now "they" have mostly all of a (lot) country`s industry and money. Who will be the first country who will actually sell a portion of his land? We can start betting about that.
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On February 16 2012 00:54 SilentchiLL wrote:Show nested quote +On February 15 2012 11:11 Voldron wrote:ps There is no way we are going to sell our islands. I 'd rather die from starvation than give to germans what my grandfather killed them for. So dear Angela Merkel , Hitler is waiting you in hell What a sad amount of people(and apparently you aswell) don't get is that we wouldn't want to annex greece even if we could. Why should we? When we got East Germany back we had to build up the completely fucked up economy there too(we actually still pay taxes which go there to build it up although much of that money is actually used for other things today which many don't know) so why should we do something like that again? Back then we did it to unite our people again, but today I really can't see how it could help us if greece would become a part of Germany. Stop listening to stupid stuff like that in your media, Merkel surely DOESN'T want to annex greece and I haven't heard from any German yet that they'd like that(we didn't even think about that before stupid media and politicians made that up, and to be honest we still don't really think about it because that claim is just so rediculous).
My problem is with selling islands like Merkel asked. No problem with german people no problem with anyone but since you want to talkhistory. You had much more to unite and rebuild than east germany my friend. You ruined pretty much every EU country with your shitty war and hitler and you want to rebuild East germany? Try rebuilding the other countries wich you ruined also and see how that feels. I cannot blame german people now for what happened 60-70 years ago. But rebuilding east germany is something you created. And to get something straight. Nobody is helping us. The money we get we have to pay with interest later. For all i care i'd rather get the fuck out of the EU. Its Called European Union. But its not a union at all.
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On February 15 2012 11:11 Voldron wrote:Somehow we have reached the point to wonder. Is it better to sit on our knees and let the banks FUCK us for like 10 years at least? Or is it better to leave euro and go back to stone age? For the past years i worked every day. Like millions of others. Payed my taxes. Payed my bills. Everything seemed ok. Then one day our retarded politicians say, you know what? We kinda fucked up bad and we need to reduce your salary to 500 euro / month. So you will earn 500 and pay 400 for your house rent. 250 for power and water. WE , people say. Hey you retard we cant live like that. Politicians say: nothing we can do about it. Either that or chaos. I am considered lucky since i still have my job. 1 out of 5 people has no job. 1 out of 2 people under 30 years old has no job. So you guys better watch out. Many countries will follow. You wont believe how fast you go down and i hope noone else lives what greek people live right now. ps There is no way we are going to sell our islands. I 'd rather die from starvation than give to germans what my grandfather killed them for. So dear Angela Merkel , Hitler is waiting you in hell
Your counrty is a democracy, is it not?
Therefore, it's your, and the other greek citizens problem and fault.
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On February 16 2012 05:26 zatic wrote:Show nested quote +On February 16 2012 05:21 Voldron wrote:
Some months ago she asked as a solution to sell or part sell some of our small islands. No she did not. Don't believe what your media tells you. Some unimportant 3rd row joke of a politician said that in an unimportant interview for Germany's worst tabloid, and of course, it was blown way out of proportion. No one in German politics who is taken seriously would suggest something as ludicrous.
Glad to hear. That might be the case cuz Media tend to lie a lot ;O
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On February 16 2012 05:41 RageBot wrote:Show nested quote +On February 15 2012 11:11 Voldron wrote:Somehow we have reached the point to wonder. Is it better to sit on our knees and let the banks FUCK us for like 10 years at least? Or is it better to leave euro and go back to stone age? For the past years i worked every day. Like millions of others. Payed my taxes. Payed my bills. Everything seemed ok. Then one day our retarded politicians say, you know what? We kinda fucked up bad and we need to reduce your salary to 500 euro / month. So you will earn 500 and pay 400 for your house rent. 250 for power and water. WE , people say. Hey you retard we cant live like that. Politicians say: nothing we can do about it. Either that or chaos. I am considered lucky since i still have my job. 1 out of 5 people has no job. 1 out of 2 people under 30 years old has no job. So you guys better watch out. Many countries will follow. You wont believe how fast you go down and i hope noone else lives what greek people live right now. ps There is no way we are going to sell our islands. I 'd rather die from starvation than give to germans what my grandfather killed them for. So dear Angela Merkel , Hitler is waiting you in hell Your counrty is a democracy, is it not? Therefore, it's your, and the other greek citizens problem and fault.
Yes indeed. I know
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EPT
