Greece Defaults. What now?

generic-user-1

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generic-user-1 on 30 June 2015

padib said:

sc94597 said:

Yep. I have no confidence that any of these countries will stop what they are doing: going back and forth on interest rates until their bubbles get bigger and bigger due to malinvestments (directed by said interest rates), bailing out said malinvestments, while they amass trillions of dollars worth of debt which they'll never be able to sustain. There will be a larger recession than the one in 2008, hyperinflation, and higher unemployment everywhere. Furthermore, with the growing economic powers in the second and third worlds global wealth distributions will more often transfer to these other, more stable regions. The cause of this? Cronyism.

Who would they be defaulting to? If every country defaults, then who is going to enforce the rules of debt?

This cycle of chaos will only lead to war.

what rule of debt? greece doesnt want to default that why there is all this talking.

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o_O.Q on 30 June 2015

generic-user-1 said:

o_O.Q said:

the economy is based on a flawed system to begin with ( by that i mean the debt based system where from the very start there will never be enough money in circulation to pay back the original debt )

it was never going to last and was never meant to

thats BS... the system has no flaw. the difference you cant explain is easyly explained... its called DEFAULT.

its normal that some loans default, thats why you pay interrest on debt...

well i'll admit i can be wrong but from what i understand the way this whole thing works is that initially from the beginning money is loaned into the system with interest

as a result from the beginning there isn't enough money in circulation to pay off what was loaned originally because of the interest and the problem grows larger and larger as more and more money is loaned into the system

as i said i can be wrong my field of study is sciences so i obviously won't definitively say i know this for sure and i'd say that perhaps the cracks appearing in the system recently show that there are indeed flaws

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o_O.Q on 30 June 2015

padib said:

generic-user-1 said:

what rule of debt? greece doesnt want to default that why there is all this talking.

I was following sc's hypothetical.

I'm basically questioning the power that the IMF holds, they are somewhat like the Iron bank of Braavos. What can they possibly do if everyone defaults?

claim private property in the nation perhaps?

Never

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Never on 30 June 2015

padib said:

generic-user-1 said:

what rule of debt? greece doesnt want to default that why there is all this talking.

I was following sc's hypothetical.

I'm basically questioning the power that the IMF holds, they are somewhat like the Iron bank of Braavos. What can they possibly do if everyone defaults?

The reason countries don't want to default is because it'll deter future investments in the country. There's no need to have additional punishments on top of that.

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sc94597 on 30 June 2015

padib said:

sc94597 said:

Yep. I have no confidence that any of these countries will stop what they are doing: going back and forth on interest rates until their bubbles get bigger and bigger due to malinvestments (directed by said interest rates), bailing out said malinvestments, while they amass trillions of dollars worth of debt which they'll never be able to sustain. There will be a larger recession than the one in 2008, hyperinflation, and higher unemployment everywhere. Furthermore, with the growing economic powers in the second and third worlds global wealth distributions will more often transfer to these other, more stable regions. The cause of this? Cronyism.

Who would they be defaulting to? If every country defaults, then who is going to enforce the rules of debt?

This cycle of chaos will only lead to war.

The internal private parties to which they owe money (bond holders, social security fund, government contractors, regional and state governments, social program funding, military pensions, etc, etc) as well as other national governments and businesess at different times (they won't all default at once.) Government will just refuse to pay these, which means they have defaulted on their payments. Alternatively the government can print money to pay these groups, but the effect is hyperinflation, so really the true monetary value they receive is not what was promised. Either way government is not paying people that it owes money to, and therefore has defaulted.