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JAPAN NEWS AND DISCUSSION

Bank of France gov tells Tokyo he's open to improving Europe bailout fund

Politics Oct. 03, 2011 - 05:12PM JST ( 16 )

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16 Comments

1

tokyokawasakiOct. 03, 2011 - 05:47PM JST

Everyone borrowing more money to lend to those that have already over borrowed.

Am I the only one who thinks this is pure madness? An alcoholic cannot drink themselves sober, neither can a borrower, borrow themselves out of debt.

Stand up and face the music. Learn from the painful lessons of default on your loans. Then slowly rebuild and never make the same mistakes in the future. That is the answer in my opinion.
-1

some14someOct. 03, 2011 - 05:56PM JST

@tokyokawasaki thanks for simplifying the matter, i thought only BOJ can comment on Noyer's speech :)
0

TakahiroDomingoOct. 03, 2011 - 07:14PM JST

the vocabulary (for instance "leveraged") used by those corporate things (can't call them people) turns my stomach. i really wonder how in h3ll can a normal person that works for a living relate in any way to these megalomaniacs that we ourselves have allowed to control our lives
0

Christina O'NeillOct. 03, 2011 - 08:28PM JST

We Expect our goverments, banks ect to act in the best interest of the population in order for living and enterprise to function and flourish,, niether of these institutions proved to be efficeint iin their portfolios. Because they buried their heads in the sand we the ordinary workers pay the price of their stupidity. Deregulation of the banks was a fundamental catastrophy. In ireland we are in the grip of austerity measures and are meeting the targets beset us by the I.M.F. and the E.C.B.,but at a price Further austerity measures are to be implemented in the December budget which will no doubt drive many families into an even more dire predicament, I fail to understand why Greece is failing to meet their targets. They are painfull and though the initial situation is not the fault of the majority of citizens we realise that unless we comply pensions, healthcare, education ect will have no finances to support them
-2

WilliBOct. 03, 2011 - 09:05PM JST

Fumbling Eurocrats trying to save the unsavable.

The only way out of this mess is a return to national currencies. Not papering over ever bigger bank rescues with ever bigger guarantees.
1

Johannes WeberOct. 03, 2011 - 10:24PM JST

@WilliB:

If You have ever been to Europe or know even a little bit about European economy than You would know that this is not possible. If the European countries would return to national currencies this would be a global financial disaster beyond imagination. By that I do not mean Greece - Greece is not a global player - but France, Germany, Italy, the Netherlands and Spain. It is impossible. If that happened, it would send shock waves through the global economy that the collapse of Lehman Brothers would seem like a picnic. It would be almost as if the USA fell apart.

It is true that Greece has severe systemic flaws and that it is probably impossible to prevent a default. This is by no means a particular weakness of the eurozone or the euro. You can currently observe banks betting against the euro. If that happened with any other currency its country would be screwed as well.

The problem of Europe is that there has not been enough Europe in the past. The problem of Greece is that it doesn't have a proper industrial infrastructure and that it has a bloated social infrastructure which was financed by cheap money because interest rates for the entire eurozone were too low for Greece's economy.

But even countries which stand on their own like Japan or the USA have catastrophic debts. Therefore, if Greece restructures itself radically and accepts that it cannot afford a bloated bureaucracy, that it has to fight corruption and that it has to develop efficient taxation, then Greece can be saved (though maybe not without a default). Oh, by the way, aren't these issues (bloated bureaucracy, corruption, inefficient tax system) which are relevant for Japan as well?
-1

some14someOct. 03, 2011 - 10:30PM JST

Oh, by the way, aren't these issues (bloated bureaucracy, corruption, inefficient tax system) which are relevant for Japan as well?

ofcourse yes, beyond reasonable doubt.
2

tokyokawasakiOct. 03, 2011 - 10:37PM JST

Greece is a looking glass into the future for all countries that utilize the debt money system. It is farcical to believe the fantasy of never paying off your debts can continue forever. There will come a time when all of the G8 nations face the exact same situation that Greece is facing right now.

If you don't believe me, just ask what your countries national debt was just 10 years ago, and compared that to today's debt. Can that level of increase be sustained? No...

Even a small child could tell you that it ain't going to be much longer before something major breaks and it all falls apart. Greece should be a warning to us all.

The only way to fix this is to put real independent people back in charge of national finance and not the privately owned greedy blood sucking system (central banks and the Federal Reserve) that secretly robs us blind by insisting we all become slaves to their debt money system. Yes they are privately owned/controlled. The government does not control the central banks/federal reserve (why doesn't everyone know this? Hmm).
0

weedkilaOct. 03, 2011 - 11:42PM JST

@tokyokawasaki

Thumbs up, especially your 10;37 post re the central banks.

~~~

"Despite the euro's sharp falls in recent months, Noyer expressed confidence in the currency." -- AFP

It's not what other insiders are saying

http://www.blacklistednews.com/Prophets_Of_Doom%3A_12_Shocking_Quotes_From_Insiders_About_The_Horrific_Economic_Crisis_That_Is_Almost_Here_/15950/0/38/38/Y/M.html
0

Johannes WeberOct. 04, 2011 - 12:15AM JST

@tokyokawasaki:

Learning happens in some places. There are countries which have passed laws which make imbalanced, debt-making budgets illegal. Austerity measures have been enacted and more will be enacted. I think the system must collapse first before it can be repaired. It's like a cart with a broken wheel running downhill far too fast, accelerating in every instand, such that no one can fix it until it hits a solid object.

The reason why Greece will hit this wall first is mainly because everyone believes that Greece will be first. No one knows who will follow suit in which order. The problem of Greece is that it is an easy kill, which cannot defend itself.

@weedkila:

Germany will not bring up the Deutsche Mark again as Your source states. The eurozone might decide upon measures to remove some members so that they can consolidate their debts, but the idea that Germany could bring up the Deutsche Mark is ridiculous. Anyone insane enough to claim this doesn't know Germany and its policy in the slightest and furthermore has no serious understanding of economy.

Due to historical reasons, Germany will never leave any european project. They cannot. It is impossible. Europe is part of the core concepts of Germany. It would be like Japan relinquishing Shinto, the emperor and the Japanese language. Furthermore, Germany is the number two exporter of the world (or number one in relation to the GDP). They cannot afford reestablishing a currency which is perceived as a safe haven and rises towards infinity. There is no other choice than maintaining the euro, not matter the cost.

There will be a lot of collapses in the next years and it will destroy capital in previously unimaginable amounts. But it will also be a rebirth of real, solid economies. Japan has faced a bubble twenty years ago and they have not learned the lesson. The next global bubble will burst soon, but there is still hope that there will be people around, who can actually manage to learn something from it and do better in the future.
-2

WilliBOct. 04, 2011 - 12:47AM JST

Johannes Weber:

" If You have ever been to Europe or know even a little bit about European economy than You would know that this is not possible. If the European countries would return to national currencies this would be a global financial disaster beyond imagination. By that I do not mean Greece - Greece is not a global player - but France, Germany, Italy, the Netherlands and Spain. It is impossible. "

Nonsense. Of course it is possible. Yes, a Euro breakup would be cause disruptions. But trying to save the Euro by ever increasing north-south transfers will lead to total disaster. The Euro introduction was motivated by politics (economists warned against it from the start), and now that the experiment has blatantly failed, of course the process can be reversed.

The Euro problem is systemic, and unless the system is changed, it can not be solved. And I am hardly stating anything sensational here; hundreds or leading economists are on record for saying the same. Even previous supporters of the Euro experiment (e.g. Werner Sinn, pres. of the international institute of public finance), have come around to state that they were wrong and the Euro scheme must be ended.

You might also note that all previous attemts at currency unions in Europe and elsewhere have ended in failure.
-2

WilliBOct. 04, 2011 - 12:59AM JST

Johannes Weber:

" Learning happens in some places. There are countries which have passed laws which make imbalanced, debt-making budgets illegal. Austerity measures have been enacted and more will be enacted. "

Doubly wrong. Firsly, they will not be enacted (tell the demonstrating masses in Greece that Germany demands more cuts...), and secondly, they would cut the tax base even more, creating a vicious circly. You don´t have to be a Keynesian to see that you can expand an economy by starving it. (Think Germany after World War I...)

" Due to historical reasons, Germany will never leave any european project. They cannot. It is impossible. Europe is part of the core concepts of Germany. It would be like Japan relinquishing Shinto "

LOL; yes, for may Eurocrats, the European pork barrel project has become a religion. However, please note that the current antagonism in Europe is CREATED by the Euro. The Euro currency is a profoundly undemocratic and anti-European project. Going back to a sensible EU without the Brussels polibureau is good for Europe.

" Germany is the number two exporter of the world (or number one in relation to the GDP). They cannot afford reestablishing a currency which is perceived as a safe haven and rises towards infinity. "

Again, doubly wrong. Firstly, Germany does not export bananas. It does not primarily compete by dumping pric,, but by quality. Before the Euro, German industry lived with 40 years of a rising Deutschmark and did just fine with it. Secondly, isn´t it ironic that you warn of the danger of a strong currency for Germany, but want to deny Greece and the other PIIG countries the benefit of a weak currency? Their modus operandi for decades was to stay competitive by devaluation. The Euro has taken that away and saddled them with a currency that is way too strong. How ironic that you make the argument for one side, but ignore the same argument for the other...
0

globalwatcherOct. 04, 2011 - 01:55AM JST

Three bold steps are needed to calm down the Euro market.

1)The governments of the eurozone must agree in principle on a new treaty creating a common treasury for the eurozone.

2) The major banks must be put under European Central Bank direction in return for a temporary guarantee and permanent recapitalisation. The ECB would direct the banks to maintain their credit lines and outstanding loans, while closely monitoring risks taken for their own accounts.

3)Third, the ECB would enable countries such as Italy and Spain to temporarily refinance their debt at a very low cost.

The challenge of EU is if these 17 countries are willing to agree with these objectives listed above.
-1

whiskeysourOct. 04, 2011 - 05:22AM JST

To little to late, we need to invent new techology or new fuel resource or new transportation system.

No jobs + No money = No spending
-1

gaijinfoOct. 04, 2011 - 06:35AM JST

None of this is going to end well. For anybody.
0

weedkilaOct. 04, 2011 - 05:16PM JST

@Johannes Weber

I don't disagree with you but adding that link meant lumping all the quotes together. Here is more info re the comment on the Deutsche mark and to also to support what you said.

This random speculation—coupled with last year’s random speculation from Hartgeld.com, a German fringe site that claimed with absolute certainty that on May 12, 2010, the Germans would for sure go back to the Deutsche mark, having already printed and minted the new bills and coins—gave the Malmgren nonsense some legs. . . .

Can they leave the eurozone?

Sure they can—anything is possible. But is it likely that the Germans will leave the eurozone?

In a word, no—because they are a creditor nation.

According to Bundesbank figures, Germany’s current account surplus for 2010 was €141 billion, with net capital exports of about €131; 2011 figures seem on track to match those amounts.

Suppose the Germans decided to exit the euro and go into the new Deutsche mark: What would happen to the euro?

Answer: The euro would drop like a rock—against anything and everything. Gold, silver, the dollar, the yen—since Germany is such a key component of the EMU’s overall balance of trade and balance of payments, Germany exiting would be catastrophic.

It would also be catastrophic for the Germans.

If Germany exited the euro and went into the new Deutsche mark, then the new-DM would rise against the euro—so therefore, German euro-denominated assets would take a massive hit.

http://gonzalolira.blogspot.com/2011/10/germany-will-never-leave.html