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Although this thread does not function under the same strict guidelines as the USPMT, it is still a general practice on TL to provide a source with an explanation on why it is relevant and what purpose it adds to the discussion. Failure to do so will result in a mod action. |
On April 22 2020 00:35 Vivax wrote:
Who is Germany going to sell to if no one creates new debt and holders of accumulated capital don't spend?
Mostly international markets. It's always been sort of a meme that Germany is just offloading their entire exports on the European periphery. To a degree it's true but if you factor it out trade within the EU isn't even that imbalanced, and Italy is even a net exporter.
There needs to be aid to Italy to cope with the medical emergency in particular but permanent transfer mechanisms from the central or northern countries to Italy is the wrong way to go. Nobody can seriously demand that countries like Poland shoulder the risk of a much richer country like Italy.
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On April 22 2020 04:11 Nyxisto wrote:Show nested quote +On April 22 2020 00:35 Vivax wrote:
Who is Germany going to sell to if no one creates new debt and holders of accumulated capital don't spend?
Mostly international markets. It's always been sort of a meme that Germany is just offloading their entire exports on the European periphery. To a degree it's true but if you factor it out trade within the EU isn't even that imbalanced, and Italy is even a net exporter. There needs to be aid to Italy to cope with the medical emergency in particular but permanent transfer mechanisms from the central or northern countries to Italy is the wrong way to go. Nobody can seriously demand that countries like Poland shoulder the risk of a much richer country like Italy.
Noone demands that of Poland. Poland is neither part of the Euro and therefore out of the question for Euro bonds, nor part of the ESM, so not part of that solution either.
All historical experiments to set up currency unions without transfers have failed.
The 19th century US states believed they could do it, spoiler, they couldn't. And that's why they now have a regular federal state with a regular budget and a regular central bank.
Many countries believed they could use fixed standards for international trade, binding the currencies together. E.g. the gold standard has been tried multiple times. It has collapsed everytime.
Bretton Woods established the dollar as a common currency. It worked for as long as the US was willing to finance Europe with the Marshall Plan. What happened when the US stopped being an exporting country that could spend their surpluss on rebuilding Europe? They left Bretton Woods, because they couldn't afford to fuel a common currency just for the sake of anti-Soviet politics anymore.
The Eurozone needs to become a political union willing to substantially fuel poorer regions, or everyone in the zone will suffer economically, just as the Eurozone has been doing for 10 years.
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Well, I'll agree that I increasingly think the Euro was a bad idea, but Europe simply is not a nation-state, it's a supra-national institution. European countries will never be willing (and arguably shouldn't) to hand their sovereign authority over to the European institutions, and that goes both ways.
If the EU were to become something like a nation-state there'd need to be democratic governance, and I cannot imagine that any small country in the EU would be willing to give up their sovereignty in exchange for money, because that's how federal states work, and money transfer mechanisms without common governance aren't justifiable to voters in the countries that pay up.
The EU is not on its way to becoming a political union. It's more realistic to in some fashion unwind the Euro and give countries more monetary autonomy and focus the EU on core competencies like defence and free movement than it is to imagine that they become another US.
A few years ago people were talking about a 'multi-speed' Europe a lot, which is another possible answer. Different levels of integration for countries that are closely aligned.
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Gents, I have a stupid question, that I can't find an answer for.
It's about debt. A country's debt is owned by several actors. For example the French debt is owned 20% by Banque de France (of which the state is the only shareholder), 25% by French banks or insurance companies, and the rest by foreign actors, including states.
An article from Le Monde does an ELI5 asking why we can't cancel parts of the debt, arguing that some of the debt is owned by European countries, and by just defaulting on it, we would create trouble for them, which is normal.
But I can't find an answer for why we wouldn't be able to just cancel the equal part of German debt owned by France (the state, or sovereign fund, not private entities of course), and vice versa.
We are talking about cancelling the debt of African countries for example, which means the state itself owns it (or at least IMF/ECB).
Or is it a non-question as no debt is owned by state-controlled entities and sovereign funds ? (Which I would find hard to believe). It's hard to find figures of who exactly owns debt. The ratio of national/foreign is easy to find, but not the exact holders, as I guess it's private information. Even something akin to 5% total debt would be useful as mutual cancellation for identical amounts...
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On April 23 2020 22:48 Nouar wrote:Gents, I have a stupid question, that I can't find an answer for. It's about debt. A country's debt is owned by several actors. For example the French debt is owned 20% by Banque de France (of which the state is the only shareholder), 25% by French banks or insurance companies, and the rest by foreign actors, including states. An article from Le Monde does an ELI5 asking why we can't cancel parts of the debt, arguing that some of the debt is owned by European countries, and by just defaulting on it, we would create trouble for them, which is normal. But I can't find an answer for why we wouldn't be able to just cancel the equal part of German debt owned by France (the state, or sovereign fund, not private entities of course), and vice versa. We are talking about cancelling the debt of African countries for example, which means the state itself owns it (or at least IMF/ECB). Or is it a non-question as no debt is owned by state-controlled entities and sovereign funds ? (Which I would find hard to believe). It's hard to find figures of who exactly owns debt. The ratio of national/foreign is easy to find, but not the exact holders, as I guess it's private information. Even something akin to 5% total debt would be useful as mutual cancellation for identical amounts...
I mean... you absolutely could if you find that the state of Germany holds Xmillion in French debt and France holds Xmillion in German debt, you could totally just cancel those out if both parties agree. Or France could even unilaterally cancel the German debt and tell them they don't need to pay it back. But most cases are more complex.
For instance, it's unlikely Germany as such holds any French debt, but rather Deutsche Bank does. And Deutsche Bank has many stakeholders, and they'd need to agree on cancelling the French debt. But even if that were the case, one party might not be happy with a straight trade as they may have a better deal (pay off over a longer period or a lower interest rate), meaning that it's actually profitable for them not to trade debts, but rather let them run their course.
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On April 23 2020 23:12 Acrofales wrote:Show nested quote +On April 23 2020 22:48 Nouar wrote:Gents, I have a stupid question, that I can't find an answer for. It's about debt. A country's debt is owned by several actors. For example the French debt is owned 20% by Banque de France (of which the state is the only shareholder), 25% by French banks or insurance companies, and the rest by foreign actors, including states. An article from Le Monde does an ELI5 asking why we can't cancel parts of the debt, arguing that some of the debt is owned by European countries, and by just defaulting on it, we would create trouble for them, which is normal. But I can't find an answer for why we wouldn't be able to just cancel the equal part of German debt owned by France (the state, or sovereign fund, not private entities of course), and vice versa. We are talking about cancelling the debt of African countries for example, which means the state itself owns it (or at least IMF/ECB). Or is it a non-question as no debt is owned by state-controlled entities and sovereign funds ? (Which I would find hard to believe). It's hard to find figures of who exactly owns debt. The ratio of national/foreign is easy to find, but not the exact holders, as I guess it's private information. Even something akin to 5% total debt would be useful as mutual cancellation for identical amounts... I mean... you absolutely could if you find that the state of Germany holds Xmillion in French debt and France holds Xmillion in German debt, you could totally just cancel those out if both parties agree. Or France could even unilaterally cancel the German debt and tell them they don't need to pay it back. But most cases are more complex. For instance, it's unlikely Germany as such holds any French debt, but rather Deutsche Bank does. And Deutsche Bank has many stakeholders, and they'd need to agree on cancelling the French debt. But even if that were the case, one party might not be happy with a straight trade as they may have a better deal (pay off over a longer period or a lower interest rate), meaning that it's actually profitable for them not to trade debts, but rather let them run their course.
Of course I'm not talking about private actors like Deutche Bank as it would have no point, but mostly states or sovereign funds, as even a slightly disadvantageous interest rate loss would probably have less impact that reducing the debt ratio of the country for future borrowing endeavours. I have no idea if Banque de France, or the Norwegian Sovereign Wealth Fund for example, would own debt of other countries.
For example :
In total, the Chinese state and its subsidiaries have lent about $1.5 trillion in direct loans and trade credits to more than 150 countries around the globe. This has turned China into the world’s largest official creditor — surpassing traditional, official lenders such as the World Bank, the IMF, or all OECD creditor governments combined.
But between European countries ? No idea...
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On April 22 2020 00:35 Vivax wrote:Show nested quote +On April 22 2020 00:25 warding wrote:
Italy needs to borrow to deficit spend and roll on its 134% of GDP debt. Lenders count on the fact that it's part of the Euro, subject to Eurozone rules and backed by the ECB, who has shown it will vaccuum up Euro govt bonds when needed.
If Italy leaves the Eurozone, who will lend to them?
I don't think the Euro would surge if Italy left. If anything it might devalue vs the Dollar. Who is Germany going to sell to if no one creates new debt and holders of accumulated capital don't spend?
They can sell to themselves. There is no need for deficit spenders IMO, and according to neoliberal economics, supply creates its own demand. Germans would have no problems consuming their own BMW's, Audis and Mercedes's if the rest of the world is broke. But if the rest of the world is not broke, then so be it. The world system of countries is really no different than a system of families within a country. You can produce for others in the country or you can produce for yourself.
Another analogy is a rich family and a poor family. Sure the rich family can produce more stuff, so how can they make money if all the other families are poor? Well poor families still need consumer goods to live their life, so they buy stuff from the rich families. So there is a currency flow from the poor families to the rich families, but then the rich families hire the poor ones and give them jobs with some form of wages that the poor families can still survive and live a decent life. With nations its no different, rich nations own these big conglomerates, they hire people in poor countries and let them do their work there. Ie Apple owns factories in china, and so chinese work there, and are able to buy their goods.
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On April 23 2020 22:48 Nouar wrote:Gents, I have a stupid question, that I can't find an answer for. It's about debt. A country's debt is owned by several actors. For example the French debt is owned 20% by Banque de France (of which the state is the only shareholder), 25% by French banks or insurance companies, and the rest by foreign actors, including states. An article from Le Monde does an ELI5 asking why we can't cancel parts of the debt, arguing that some of the debt is owned by European countries, and by just defaulting on it, we would create trouble for them, which is normal. But I can't find an answer for why we wouldn't be able to just cancel the equal part of German debt owned by France (the state, or sovereign fund, not private entities of course), and vice versa. We are talking about cancelling the debt of African countries for example, which means the state itself owns it (or at least IMF/ECB). Or is it a non-question as no debt is owned by state-controlled entities and sovereign funds ? (Which I would find hard to believe). It's hard to find figures of who exactly owns debt. The ratio of national/foreign is easy to find, but not the exact holders, as I guess it's private information. Even something akin to 5% total debt would be useful as mutual cancellation for identical amounts...
The state debt is actually an infinity of larger or smaller "state bonds", with shorter or longer runtimes, different fixed or variable rates issued to different lenders which trade them on financial markets.
It is not as simple as "Germany cancels X French bonds" and "France cancels X German bonds". When "the state" holds those bonds of other countries, they usually mean state organisations, like retirement fonds, which hold them. And they hold them, because they get a regular income from it which they need for their own operations. So they couldn't fullfill their purpose, if they cancel the debt.
And then of course there is the central bank. The central bank buys state debts from banks to issue money in the banks reserve. Every bank has money in the central banks reserve and based on the amount of money they have, the more credit they can issue. So when the ECB buys an Italian bond for 10Mio € from Deutsche Bank, they put that money on Deutsche Bank's account at ECB. Now Deutsche Bank has 10 Mio € more securities, which allows them to create money worth ~100 Mio € out of nowhere, when they issue credits and therefore credits get cheaper.
If the ECB would just cancel the state debts, they couldn't do that, because they in turn would have no money to buy the bonds from the banks and they couldn't fullfill their purpose to stabilize prices at around 1.9% inflation.
So yes, in rare cases you may be able to just cancel one debt against another. But usually, the holders of those bonds use those debts as their regular operational income, just like a landlord does with the rent.
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Anyone make it out to a local protest? I hear Stockholm police are wildin out?
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No racism in Ukraine, no need to protest at this point. And we are not ready yet for another party -.- Still suffering the consequences of the last one a few years ago
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This also looks like a pretty big deal : a manufacturer of secure phones and its chat app mainly used for crime has been cracked and millions of messages intercepted by police in several european countries. They are going to be used for years to come and have already lead to a lot of arrests and dismantling of organisations.
https://www.vice.com/en_us/article/3aza95/how-police-took-over-encrochat-hacked
There are also some internal corruption inquiries since it seems there were leaks from inside the police.
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United Kingdom13775 Posts
In a rare bit of good news, looks like the president in Poland has narrowly won reelection.
Poland's incumbent President Andrzej Duda has narrowly beaten challenger Rafal Trzaskowski in Sunday's presidential vote.
The National Electoral Commission said Mr Duda had won 51.2% of the votes.
It is Poland's slimmest presidential election victory since the end of communism in 1989.
One of the major issues of the election was the future of the country's strained relations with the European Union.
Mr Duda is a social conservative allied with the government led by the nationalist Law and Justice (PiS) party, while Mr Trzaskowski is the socially liberal mayor of Warsaw.
Source
It was notable to me how aggressively every media source I read was against Duda and had a less-than-average emphasis on objectivity in reporting. Not surprising, strictly speaking - he is the antithesis to what the European liberal / left-leaning groups stand for - but it's usually a lot more nuanced. I'm pleased that he won again, albeit by the slimmest of margins.
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Norway28689 Posts
What's the lack of nuance in reporting? I mean, I get you are anti-EU and that's a position I respect, and PiS is not a traditional right wing party if you look at their economic policies (I expect purely from an economics perspective I prefer Duda to Trzaskowski,) but the social conservatism and campaign of lies/anti-democratic media control/court stacking is on another level from what you see in any western country, and it's genuinely worrisome.
Treatment of LGBT isn't 'let's have a nuanced debate around gay abortion and whether trans people should be allowed to play sports', it's 'lgbt are not people but an ideology', the 'traditional polish vs western values' isn't 'let's preserve traditional values and try to highlight monogamous marriage and waiting a bit with having sex', it's 'I hear from elderly people in western countries that they want to move to poland because in the west they are being forcefully euthanized' and 'the liberals want to force four year olds in kindergartens to masturbate'.
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United Kingdom13775 Posts
On July 14 2020 09:01 Liquid`Drone wrote:
What's the lack of nuance in reporting? I mean, I get you are anti-EU and that's a position I respect, and PiS is not a traditional right wing party if you look at their economic policies (I expect purely from an economics perspective I prefer Duda to Trzaskowski,) but the social conservatism and campaign of lies/anti-democratic media control/court stacking is on another level from what you see in any western country, and it's genuinely worrisome.
See, that much is fine, and so is being concerned about any of the LGBT matters that were brought forward. The problem I saw was that none the good was even mentioned - the entire story in the few I read (Guardian, BBC, Reuters, CNN) was all-in on the narrative of “Duda the anti-LGBT dictator vs the other guy.” Surely there’s more to it than that; no matter how much anyone would like to paint the rhetoric to be so, you don’t win half the popular vote of a 70% turnout election on a platform that doesn’t actually have more depth than that.
The comments from the very few pro-Duda, English-speaking Poles I could find had a more interesting line of argument than that, largely rooted in both economics and an intriguing nationalist approach. Evidently the major news sources were unable to locate any such understanding of why people voted for Duda, which is strange because even for other “EU public enemy” candidates like Orban they could find some mild acknowledgement of platform beyond “vote for dictatorship.”
This particular time, it never went beyond “Duda stands for anti-LGBT and that’s all you need to know.” Meh.
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Isn't it sad that a leader of people can't legitimize people as such?
Shouldn't that be enough to write him off right away?
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Maybe it's because I haven't woken up completely yet, but I don't understand what you mean by
a leader of people can't legitimize people as such
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Polish websites regularly translate parts of articles about Poland from western newspapers back into polish. This is source of strong anti western sentiment as they select most egregious and edgy parts of articles. Even i get angry at those 'pesky westerners' when i read that and i have a strong anti PiS leaning. The thing is the LGBT issues are not something that is winning PiS elections, they are winning because they control state media and cause of their social programms, LGBT stuff is mostly smoke and mirrors.
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On July 14 2020 15:15 Sent. wrote:Maybe it's because I haven't woken up completely yet, but I don't understand what you mean by
I wasn't fully awake either, but I meant legitimizing people as people. Sexuality is core to what makes humans, well, human. Denying them that by discrimination is dehumanizing them, aka, delegitimizing people. I don't even know if it makes sense to use this specific word.
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EPT
