Greek Debt Bail Out

[Nereus]

Explanation of the Greek Bail Out


It is a slow day in a little Greek Village. The rain is beating down

and the streets are deserted. Times are tough, everybody is in debt,

and everybody lives on credit.

On this particular day a rich German tourist is driving through the

village, stops at the local hotel and lays a €100 note on the desk,

telling the hotel owner he wants to inspect the rooms upstairs in order

to pick one to spend the night.

The owner gives him some keys and, as soon as the visitor has walked

upstairs, the hotelier grabs the €100 note and runs next door to pay

his debt to the butcher.

The butcher takes the €100 note and runs down the street to repay his

debt to the pig farmer.

The pig farmer takes the €100 note and heads off to pay his bill at the

supplier of feed and fuel.

The guy at the Farmers' Co-op takes the €100 note and runs to pay his

drinks bill at the tavern.

The publican slips the money along to the local prostitute drinking at

the bar, who has also been facing hard times and has had to offer him

"services" on credit.

The hooker then rushes to the hotel and pays off her room bill to the

hotel owner with the €100 note.

The hotel proprietor then places the €100 note back on the counter so

the rich traveller will not suspect anything.

At that moment the traveller comes down the stairs, picks up the €100

note, states that the rooms are not satisfactory, pockets the money,

and leaves town.

No one produced anything.

No one earned anything.

However, the whole village is now out of debt and looking to the future

with a lot more optimism.

And that, Ladies and Gentlemen, is how the bailout package works

[Norseman]

Excellent explanation. Thank you.

[dtaai-maai]

I'm slightly embarrassed to admit that I've just spent a few minutes working out that everyone got paid except the hotel owner, who is €100 out of pocket.

[Big Boy]

I'm slightly embarrassed to admit that I've just spent a few minutes working out that everyone got paid except the hotel owner, who is €100 out of pocket.

Not really, because he used his €100 to settle his debt with the butcher, so he used his money wisely.

[Frank Hovis]

This bit is wrong

At that moment the traveller comes down the stairs, picks up the €100 note, states that the rooms are not satisfactory, pockets the money,

It should read

Just before the German comes down the stairs the Greek Social Services Administrators take the 100EUR off the counter redistribute it to Greek pensioners and the Greek unemployed, leaving behind a promissory note that they will repay the German in 10EUR instalments over the next 10 years, and will ask the German for another 100EUR every year so that they can afford to repay him his 10EUR on time (or a little after it's due date or perhaps not at all).

[dtaai-maai]

I'm slightly embarrassed to admit that I've just spent a few minutes working out that everyone got paid except the hotel owner, who is €100 out of pocket.

Not really, because he used his €100 to settle his debt with the butcher, so he used his money wisely.

Oh well, not the first time I've wasted a few minutes!

[Homer]

As usual when the IMF tightens down on a debtor nation who can't pay up, opinion writers wring their hands saying it's counter productive. They cite examples of how such draconian (their words, not mine) measures almost always plunge a struggling economy into deep recession and massive unemployment that takes decades to recover from.

No Sh*t. Despite what the IMF says publicly, that's what they expect to happen. When the IMF started the rescue, Greece was like an alcoholic, waking up in the gutter having soiled himself, vowing he's going to turn things around. A couple IMF rounds later Greece hasn't changed. So the IMF said go it alone or submit to our economic detox program. Either way a generation or more may pass before Greece crawls out of the hole it dug it self into. The IMF has accomplished two goals: 1) Other countries get a lesson of what can happen if you don't pay up. 2) A generation or more of Greeks has known little else than austerity. They've had an opportunity to learn from the changes, strength and character it took to fix a broken culture and government. You think they're ready to go on another debt binge?

[caller]

When the IMF started the rescue they broke all their own rules in doing so. So they are hardly in a position to preach. In any case, they are the ones that are saying that what is intended to be imposed on Greece won't work, as everyone knows. United Europe my ass! This fiasco has convinced me that we are better off out of it. 5th rate politico's from Merkel - especially Merkel - down unable to come up with a solution to the problem and all passing the buck! I hope Greece breaks Europe as it is, because it's currently broke in more ways than one.

[redzonerocker]

When the IMF started the rescue they broke all their own rules in doing so. So they are hardly in a position to preach. In any case, they are the ones that are saying that what is intended to be imposed on Greece won't work, as everyone knows. United Europe my ass! This fiasco has convinced me that we are better off out of it. 5th rate politico's from Merkel - especially Merkel - down unable to come up with a solution to the problem and all passing the buck! I hope Greece breaks Europe as it is, because it's currently broke in more ways than one.

Spot on mate.

[arcadianagain]

And as for the French, great supporters of the EU, they regularly hold everyone to ransom, currently closing Calais. Do they think of the greater good? Mon cul they do.