EPT...wait
Misconceptions about the European Debt Crisis - Page 3
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jlim
Spain943 Posts
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caradoc
Canada3022 Posts
On December 31 2011 02:55 Klondikebar wrote: Well politicians have never understood economics so it's no surprise that they confuse GDP with true growth. And most classical economists do define growth as a measured increase in the standard of living...it's not a new or even obsolete definition. If you use an increase in GDP to mean growth in any discourse, you're just wrong. You're just using the wrong words. A lot of people do it but they aren't correct. I guess maybe in the finance world they might use the two as the same thing...I'm not sure. I sit in the economics camp. heh, whoops, I re-read my post ''economic growth' as a proxy for standard of living'-- should read as economic growth as a proxy for 'increase in GDP'. but I think that came across in the rest of my post. *yawns* its late, and its been a long-ass day. Time to sleep. Hope this thread isn't a shitstorm or been overrun by the mindless hordes of walking undead when I check it tomorrow. XD | ||
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targ
Malaysia445 Posts
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DorF
Sweden961 Posts
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Klondikebar
United States2227 Posts
On December 31 2011 03:23 DorF wrote: Why is it called the European debt crisis ? I live in Europe and we don't have any significant debt in Sweden... I thought it was like mainly Italy, Greece and Spain, that's not really even a majority of Europe is it ? Because depending on how it's solved, everyone in the EU is going to suffer. Actually, I think no matter how it's solved everyone in the EU is going to suffer. | ||
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sekritzzz
1515 Posts
On December 31 2011 00:19 Feartheguru wrote: There was no EU in the early 90s, what rules are you talking about? Most people assume the EU came into being around the year 2000 with the introduction of the Euro currency. It's actually completely wrong, the currency was simply the next step of the plan. The European union actually started very soon after WW2 in the 1950's with the maastricht treaty and so on and so forth. I don't really want to elaborate too much because the EU problem takes too long to explain and too complicated for non-finance/economics people. If you live in Europe and have a saved up pension, I HIGHLY recommend you read up on the crisis and figure out what's going to happen to your money because 40-50 years of work can become worthless very fast. | ||
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Danglars
United States12133 Posts
3. Eurozone countries surrendering control of their monetary policy to the European Central Bank, and the ECB refusing to lend to countries with high debt, like Greece, Italy and Spain, at low rates. How about just surrendering control of their monetary policy to a central entity. Leave it at that. | ||
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3FFA
United States3931 Posts
banks become popular-> banks become bigger-> banks become Big and are becoming bigger-> All money is trusted on big banks->big banks make mistakes thinking it will make them more money(bigger yay!)-> big banks crash-> economy crisis/ recession . Is basically what happened, in my view. Note: very basic view of it all but also very clear. Although Greece just bad at making people spend income taxes >.> | ||
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DorF
Sweden961 Posts
On December 31 2011 03:26 Klondikebar wrote: Because depending on how it's solved, everyone in the EU is going to suffer. Actually, I think no matter how it's solved everyone in the EU is going to suffer. I don't really see how, I mean not all the countries in the EU use the same currency. And couldn't we technically just kick them out and cut our losses if we felt like it was going to be detrimental to us ? | ||
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wakefield
United Kingdom114 Posts
On December 31 2011 03:45 DorF wrote: I don't really see how, I mean not all the countries in the EU use the same currency. And couldn't we technically just kick them out and cut our losses if we felt like it was going to be detrimental to us ? Because the countries that are going under buy other peoples goods, so the exports of all the EU states will suffer as a result with the other elements to the economy of a country suffering as a result. Btw, did this guy seriously suggest inflation as a cure? | ||
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Klondikebar
United States2227 Posts
On December 31 2011 03:45 DorF wrote: I don't really see how, I mean not all the countries in the EU use the same currency. And couldn't we technically just kick them out and cut our losses if we felt like it was going to be detrimental to us ? My limited understanding of the EU is that it's actually a pretty ironclad union. You're not allowed to just kick people out whenever you feel like it. And the debt is going to have serious ramifications for the strength of the Euro. Debt bearing and import heavy countries need a strong currency. If the Euro gets weak, it's going to make goods imported to Europe MUCH more expensive. P.S. I say debt bearing and import heavy as opposed to export driven economies like China that want weak currencies to make their exports cheaper to the rest of the world. | ||
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Zren89
United States131 Posts
On December 31 2011 01:56 H0i wrote: The problem is that the existence of interest is a ponzi scheme. Well, that is only a part of the problem but it is a huge part. Dude, just as much of a Ponzi scheme as Social Security here in the U.S. >.< | ||
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storm8ring3r
Germany227 Posts
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H0i
Netherlands484 Posts
On December 31 2011 03:56 Zren89 wrote: Dude, just as much of a Ponzi scheme as Social Security here in the U.S. >.< In the modern world nearly everything is a ponzi scheme. The bubble WILL burst. | ||
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DorF
Sweden961 Posts
On December 31 2011 03:54 Klondikebar wrote: My limited understanding of the EU is that it's actually a pretty ironclad union. You're not allowed to just kick people out whenever you feel like it. And the debt is going to have serious ramifications for the strength of the Euro. Debt bearing and import heavy countries need a strong currency. If the Euro gets weak, it's going to make goods imported to Europe MUCH more expensive. P.S. I say debt bearing and import heavy as opposed to export driven economies like China that want weak currencies to make their exports cheaper to the rest of the world. Yeah, the Euro will get weaker, wich would make my money stronger towards the euro and I don't really see the bad in that, for me I mean. I'm not trying to troll or to be aggressive it's just that I don't simply understand since I'm pretty dimwitted when it comes to economy and all that  | ||
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Klondikebar
United States2227 Posts
On December 31 2011 04:08 DorF wrote: Yeah, the Euro will get weaker, wich would make my money stronger towards the euro and I don't really see the bad in that, for me I mean. I'm not trying to troll or to be aggressive it's just that I don't simply understand since I'm pretty dimwitted when it comes to economy and all that If your currency can move independently from the Euro then yes, it will get stronger. Although I thought European currencies were pegged to the Euro. | ||
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sekritzzz
1515 Posts
On December 31 2011 04:08 DorF wrote: Yeah, the Euro will get weaker, wich would make my money stronger towards the euro and I don't really see the bad in that, for me I mean. I'm not trying to troll or to be aggressive it's just that I don't simply understand since I'm pretty dimwitted when it comes to economy and all that In that aspect yes you personally will be better. Your country will not however. When the euro goes down and the krone goes up in value, nobody will buy Swedish goods because they are too expensive=ikea too expensive=ikea makes a loss and cuts jobs= bad for Sweden. Not multiply that to all the other firms that depend on Europe to buy their goods. | ||
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DorF
Sweden961 Posts
On December 31 2011 04:13 Klondikebar wrote: If your currency can move independently from the Euro then yes, it will get stronger. Although I thought European currencies were pegged to the Euro. We don't use the euro, yet we're in the EU. The switch over to using the euro was optional for each member country, so Sweden for instance is not part of said monetary union wich is why I don't see how we will be affected by this. But I see now why it's called the "European debt crisis" most countries will be affected since they are using the euro. EDIT: In that aspect yes you personally will be better. Your country will not however. When the euro goes down and the krone goes up in value, nobody will buy Swedish goods because they are too expensive=ikea too expensive=ikea makes a loss and cuts jobs= bad for Sweden. Not multiply that to all the other firms that depend on Europe to buy their goods. Ok thanks, I see now. But wouldn't that situation apply to all countries then ? Their money being stronger compared to the euro-using countries and therefore nobody would buy their stuff ? Like Brittain, Russia or Turkey for instance ? | ||
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Klondikebar
United States2227 Posts
On December 31 2011 04:14 sekritzzz wrote: In that aspect yes you personally will be better. Your country will not however. When the euro goes down and the krone goes up in value, nobody will buy Swedish goods because they are too expensive=ikea too expensive=ikea makes a loss and cuts jobs= bad for Sweden. Not multiply that to all the other firms that depend on Europe to buy their goods. Maybe, but what's Sweden's trade balance like? If imports outweigh exports then a stronger currency will be a net benefit for the country. @Dorf that's turning out to be a wise decision for Sweden. And yes, your country will be less affected than the others then. | ||
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Dapper_Cad
United Kingdom964 Posts
On December 30 2011 21:12 paralleluniverse wrote: It's not my solution, it's one part of Paul Krugman's solution (he's an economics professor who won a Nobel Prize). On December 30 2011 21:17 bumwithagun wrote: PS- The Nobel winning Krugman was VERY different than the current Krugman On December 30 2011 21:28 Lebesgue wrote: Paul Krugman won the noble prize for his research on trade theory not on the debt crisis. There is no Nobel Prize in Economics. On December 30 2011 21:28 Lebesgue wrote: Paul Krugman won the noble prize for his research on trade theory not on the debt crisis. For 10 years he resembles more a politician than an economist. He is not active in research anymore and yet voices his opinion on pretty much everything that concerns economics. In last 5 years his been ridiculed or proven wrong many times yet he keep preaching. I would take everything that he said with a bowl of salt. He has political agenda and he keep pushing it. Economics is mostly politics. Throw a few billion at historians and the same thing would happen to history. Throw a few billion at psychologists and... oh wait, that already happened. On December 30 2011 22:22 mememolly wrote: Greece should never of been allowed to join the Euro but who knew they were lying about their deficit? At least some people in the Greek Government and some people in Goldman Sachs On December 31 2011 00:10 FuzzyJAM wrote: The developed world is still far better off (on average) than it was a couple decades ago. On December 31 2011 02:26 Klondikebar wrote: Well yeah, true economic growth is by definition an increase in the standard of living. That's good for everyone. It really depends what you do with the data. A fantastically simple example: Take a million people who earn $1 a day. Lets inject some "economic growth". We'll put 999,999 people on 50c a day and put one person on $1,000,0001 a day. This million people now, on average, earn 50% more. But the median person earns half what they earned before. On December 31 2011 02:38 Klondikebar wrote: Also, the problem in your example (and quite arguably in the real world right now) is distribution, not growth. We wouldn't say that growth is bad, we would say that distribution is bad. Growth gives us more stuff, that's undeniably good. Distribution takes that new stuff away from some people and gives it to others, that's bad. You mean REdistribution. Distribution of wealth is like gravity, it just happens. Actually so does redistribution so you're kind of screwed there too, I think what you mean is "redistribution by the state". On December 31 2011 02:55 Klondikebar wrote: Well politicians have never understood economics so it's no surprise that they confuse GDP with true growth. On December 31 2011 03:27 sekritzzz wrote: I don't really want to elaborate too much because the EU problem takes too long to explain and too complicated for non-finance/economics people. No one understand economics, it's not just in random threads on team liquid that people argue about it, at the highest levels there are fundamentally different philosophies being argued over. Within philosophies there are arguments over what to do to solve even very basic problems. On December 31 2011 02:32 Dwelf wrote: Its very annoying if you actually study economics to read these threads That's weird, I usually find people who study economics annoying. | ||
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