Greece has been the talk of the town during the past weeks. After avoiding going bust last week, the country needs to restart the Economy, once again. The question is if the Balkan mentality is the main Enemy for getting Greece back on track? People have a huge disbelief in politics and the government, irrespective of who is running the country. This mentality is hard to explain, especially to the Troica people trying to work out a quick fix. The pride of the Balkan people, might yet again prove to be the biggest problem in trying to restore the country. We have seen similar behavior in former Yugoslavia and other countries. Be prepared for more protests, riots and ultimately a full blown civil unrest situation, when people decide enough is enough. Happy Liberty Day, to our American readers. Greece’s Achilles heel by Kathimerini;
As Greece teetered on the brink of bankruptcy last week, the protagonists of our public life appeared oblivious to the danger, sticking to the risky behavior that became the norm over the past few decades. Extreme confrontation has become automatic: Now that things are very dangerous and we need to make a great effort to achieve consensus and show flexibility, we remain trapped in the rituals of absolute conflict. It is no coincidence that “The Iliad,” the mold from that which we now call Hellenism was shaped, focuses on the personal quarrel between Agamemnon and Achilles which jeopardizes their 10-year expedition against Troy. Our politicians in Parliament, the masked stone-throwers and the heavily armored riot police repeatedly relive this ritual, each seeing himself as a hero.
The danger of this obsession is great: We don’t see the essence of problems (and so we cannot solve them), we don’t cooperate with each other, we lose any moral high ground that we may have and we flirt endlessly with catastrophe. When the causes of conflict are trivial, the damage may be limited. When our future is at stake, blind submission to this tradition could be fatal. Yet we persist with our mistakes.
Today we are going to talk about something that happened in 1967.
That year will have a different significance for many readers – at least those old enough to have a personal connection to it (which probably thins the field faster than a call for volunteers for clean-up duty after a frat party). For me 1967 was the year I was born.
That’s most definitely NOT what we are going to be talking about today though. We have a subject of far weightier importance to the world than the arrival of one Grant Williams.
When thinking of 1967, most minds immediately conjure up images of the Vietnam War or Che Guevara’s capture and execution. Elvis fans remember his marriage to Priscilla Beaulieu and sports fans think of the Green Bay Packers’ win in the ‘Ice Bowl’; Pamela Anderson entered the world and Jack Ruby shuffled off his mortal coil – but none of these events are as important for the purposes of today’s discussion than the introduction of a game by the Ideal Toy Company.
The game consisted of a plastic tube, a number of plastic rods called straws and a number of marbles. The plastic tube stood upright on a base that contained four separate trays and the straws were passed through holes in the side of the tube to form a “web”. The marbles were then placed in the top of the tube and held in place by the web.
The game had the wonderfully onomatopoeic name ‘KerPlunk™!’.
The idea of the game (for those unfortunate enough to have been born in what will no doubt be remembered historically as the Post-KerPlunk™! era) was exceedingly simple:
(Wikipedia): At the start of play, the entire tube is rotated so that a hole in the base of the tube is aligned with the active player’s tray. Players take turns removing a single straw from the cylinder while trying to minimize the number of marbles that fall through the tube and into their tray. Once a player has committed themselves to a particular straw by touching it, they must remove it. The player who accumulates the fewest dropped marbles wins.
In turn, the players then had to remove every straw, one-by-one, but the order in which they did so relied completely on their assessment of which straw’s removal would do the least damage in terms of causing the minimum possible number of marbles to cascade into the tray in front of them.
Ultimately, the game ends when all the marbles have come crashing down.
OK….. so by now you all know where I’m going with this, but indulge me a little as I spin my sorry tale of pulled straws and crashing marbles.
Full report, Hmmm Jul 03 2011-1
We had some problems with our server this morning, but here is the News that Matter from our Virtual Sales Trader.
Nestlé, the world’s largest food company, is in talks to buy Chinese snack and confictionary maker Hsu Fu Chi International. Discussions have been taking place “on and off” for two years, says Bloomberg. Hsu Fu Chi reported 2010 profits of Rmb602.2m ($93m) on sales of Rmb4.31bn, http://ftalphaville.ft.com/thecut/2011/07/04/611621/nestle-in-talks-to-buy-chinese-confectioner/
The senior ranks of Deutsche Bank are close to open warfare with Josef Ackermann, chief executive, and Clemens Börsig, supervisory board chairman, at loggerheads over the process of finding Mr Ackermann’s successor http://ftalphaville.ft.com/thecut/2011/07/04/611606/recriminations-at-deutsche-over-failed-weber-move/
The US bond market faces a potentially testing July, should the impasse over raising the Federal debt ceiling fail to result in a deal and thus threaten the risk of a default by the Treasury, says the FT. While the consensus in the bond market is for a last minute deal ahead of the August 2 deadline http://ftalphaville.ft.com/thecut/2011/07/04/611596/us-debt-stand-off-threatens-bonds/
The European Union has warned that Greece will stay in recession for the rest of this year, upending forecasts of a return to growth in the third quarter. The economy is set to shrink 3.75 per cent in 2011 and will show only marginal growth in 2012, http://ftalphaville.ft.com/thecut/2011/07/04/611576/greek-recession-to-last-until-2012/
While the US is celebrating the 4th of July and the Liberty of the Nation, S&P is threatening of a Greek default. The Trocia roll over plan seems to be flawed, and would cause great headache for the parties involved if it fails. Bloomberg reports;
Standard & Poor’s said today a rollover plan serving as the basis for talks between investors and governments would qualify as a distressed exchange and prompt a “selective default” rating. That may leave the European Central Bank unable to accept Greek government debt as collateral, impairing the lifeline it has provided the country’s banks.
“It sends all the officials and banks back to drawing board to think something new,” said Christoph Rieger, head of fixed-income strategy at Commerzbank AG in Frankfurt. “The ECB is saying it won’t accept debt in a default. Someone needs to give in — either Germany or theratings agencies or the ECB. One of three will have to compromise.”
The S&P statement comes less than 48 hours after euro-area finance ministers authorized an 8.7 billion-euro ($12.6 billion) loan payout to Greece by mid-July and said they would aim to complete talks with banks on maintaining their Greek debt holdings within weeks.
The prospect of a default rating adds to policy makers’ concerns that Greek officials can enact the 78 billion euros of austerity measures that lawmakers passed last week as a condition of receiving further aid.
If Greece defaults, as thetrader has argued is necessary, we will get the Lehman situation back. The ECB will end up in a severe liquidity crisis as the Greek bonds won’t be accepted as collateral. Further, this would of course spread to the European banks, and we would get a run on the Greek Banks. Let’s see how well designed the Troica roll over plan is. We still argue for Greece to make an Icelandic “liberty” move, drop the Euro and tell the banks, we are not paying other people’s stupidity. Then Greece could start celebrating a day of Liberty, instead of being squeezed by the Banksters.
Don’t forget, Greece’s first tranche of Aid, won’t even last until the end of August.