What happens now with greece? how will it affect globally and US economics ? That they Voted NO will they default, will it drag the rest of the world with them? Thank you for your input.


kleinbl00:

You're likely to get a lot of opinions in response to this question, ranging from highly-educated to not-so-highly-educated to strongly opinionated to laughably wrong. The important thing to remember is they're all opinions, not facts. Milton Friedman himself could come in here and expound for a thousand words and it would still be an opinion. Paul Krugman could write a thousand words explaining why Milton Friedman is full of shit and it, too, would be an opinion.

Ever see Goldfinger? That awesome James Bond with the air vixen named Pussy Galore and her merry band of Cessna-flying femme fatales? The idea being to knock out half of Kentucky so a dude with a weird hard-on for gold could drive a nuke into Fort Knox and irradiate the US gold reserves thereby driving the financial markets into total chaos because ZOMG what would happen if bank notes weren't convertible into gold?

Yeah, turns out the supervillian's name was Richard Nixon. The results were so fucking boring they don't even teach them in history class. Shit, they don't even teach that shit in macroeconomics. Which is not to say it wasn't a monumentally important event in the financial history of the world, but is to say that "monumentally important events in the financial history of the world" tend to play out in a lot less interesting ways than the WSJ business page would have you believe.

The takeaway, however, is this: the effects of abolishing Bretton Woods weren't well understood then and are still argued about now. Every election, some Republican or Libertarian floats the notion of returning to the Gold Standard (which we abolished back in like the '30s) because people just don't fucking understand economics, even the ones that have Nobel prizes in them. So what happens now is kind of the big experiment.

My GUESS? Excess emphasis and punctuation because it's exactly that - a guess - is that you'd rather have your money in dollars or pounds than in euros. I'm also going to guess that holidays in Greece are about to get a lot cheaper but also a lot less pleasant. Mediterranean Europe has historically shown a penchant for authoritarian strongmen and authoritarian strongmen generally arise out of economic chaos. Then people flee, dissidents go on one-way helicopter flights, poets write banned poems that Amnesty International publishes and 40 years later everyone talks about Greece's "Lost Years."

But it's a guess. It's all a guess. My guess counts for as much as your guess counts for as much as Paul Krugman's guess counts for as much as Ernst Stavro Blofeld's guess.

Dollars to donuts every capitalist you know is trying to figure out how to monetize it, however, so expect the markets to be rowdy tomorrow.


posted by jeffreyan12: 1177 days ago