Greece

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kumquat
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Re: Greece

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adrian2 wrote:
tedster wrote:Who will sell anything to Greece for drachmas that have no value?
The drachma will have a value; it will still be free floating.
True, just like the Zimbabwean dollar has a value.
I don't intend to offend anyone, that part is just a bonus.

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Re: Greece

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adrian2 wrote
The drachma will have a value; it will still be free floating.
Of course, but based on????
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Re: Greece

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kumquat wrote:
adrian2 wrote:
tedster wrote:Who will sell anything to Greece for drachmas that have no value?
The drachma will have a value; it will still be free floating.
True, just like the Zimbabwean dollar has a value.
The Zimbabwe dollar does not exist for quite a few years.

In any case, it's a truly bad comparison. There was always a free market in drachmas, you did not need to go to a shady black market dealers to exchange drachmas for dollars, it was just a continuously devaluing currency (nothing like the speed of a Turkish lira, Yugoslav dinar or even Romanian leu). The forex rate today was pretty close to the one tomorrow, but on a year-by-year basis there was a noticeable decline (more or less compensated by much higher drachma interest rates).

On an anecdotal level, I had a good Greek friend while I was living in South Africa in the early nineties. He told me that his parents (they were all local residents, maybe citizens, not sure) kept most of their money back in Greece, "because of the good interest rates". I did a not so quick check (it was way before Google) and pointed out to him that all they were gaining in annual interest they were losing in devaluation. They did not believe me then, and now the wheel may be turning back again.
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adrian2
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Re: Greece

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tedster wrote:adrian2 wrote
The drachma will have a value; it will still be free floating.
Of course, but based on????
It's called a free market, it will find an equilibrium based on supply (tourism, olive oil and other exports) and demand (imports etc).

If they offered you a month all inclusive in Greece for $1,000 would you go? I know I will.
If they offered you a month all inclusive in Greece for $100,000 would you go? I know I would not.
Somewhere in between there is an equilibrium.
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Re: Greece

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adrian2 wrote
It's called a free market, it will find an equilibrium based on supply (tourism, olive oil and other exports) and demand (imports etc).

If they offered you a month all inclusive in Greece for $1,000 would you go? I know I will.
If they offered you a month all inclusive in Greece for $100,000 would you go? I know I would not.
Somewhere in between there is an equilibrium.
$ are not drachmas. Besides, if someone from Greece wanted to buy something from me and wanted to pay in drachmas, I would not sell. Would you?
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Re: Greece

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tedster wrote:Besides, if someone from Greece wanted to buy something from me and wanted to pay in drachmas, I would not sell. Would you?
No you would sell it in $ and they would exchange drachmas at the going rate to buy it. That rate will get less and less favourable over time until it reaches a steady state, same as Argentina.
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Re: Greece

Post by tedster »

kcowan wrote

tedster wrote:
Besides, if someone from Greece wanted to buy something from me and wanted to pay in drachmas, I would not sell. Would you?
No you would sell it in $ and they would exchange drachmas at the going rate to buy it. That rate will get less and less favourable over time until it reaches a steady state, same as Argentina.
Yes I get that, but first they have to be able to buy the dollars or sell something for dollars. If their is nothing to sell for dollars, then the drachma is only useful within Greece.
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Re: Greece

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tedster wrote:kcowan wrote
tedster wrote:
Besides, if someone from Greece wanted to buy something from me and wanted to pay in drachmas, I would not sell. Would you?
No you would sell it in $ and they would exchange drachmas at the going rate to buy it. That rate will get less and less favourable over time until it reaches a steady state, same as Argentina.
Yes I get that, but first they have to be able to buy the dollars or sell something for dollars. If their is nothing to sell for dollars, then the drachma is only useful within Greece.
That's why I gave you the example of a one month all inclusive package in Greece -- using local services where the labour force is paid in drachmas and you, a Canadian, paying in "hard currency".

In effect, you are providing an exchange rate, anywhere between $1,000 for one month all inclusive and $100,000 for the same.

Anything has a price, even shit. Paraphrasing James Hymas, many of us buy bags of shit each spring to use it on our lawns or flower beds.
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Re: Greece

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tedster wrote: Yes I get that, but first they have to be able to buy the dollars or sell something for dollars. If their is nothing to sell for dollars, then the drachma is only useful within Greece.
Hence something that socialist wingnut (and the majority of his citizens) do not understand. Internal messaging has not been good. Some critical imports are still required and payment still has to be made in a currency a supplier is willing to accept. The government should be saying that since Greece is broke, the country's revenues must now exceed spending and part of that is: 1) payment and collection of outstanding taxes, and 2) sale of state assets. The delinquent tax issue HAS to be dealt with.
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Re: Greece

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like_to_retire wrote: As long ago as 2010, using satellite photos, Greek tax authorities examined the claims of the residents of Athens's wealthy suburbs and discovered that, rather than the 324 swimming pools claimed by the locals, there were 16,974 of them. :shock:
ltr
Love that bit about the swimming pools.
How about this one as reported by Mathew Fisher of the Notional Post. On the island of Zakynthos in the Ionian Sea, better known now as "The Island of the Blind", 700 of the island's 35,000 residents had falsely claimed that they were blind to receive 350 Euros per month as compensation. Many of the cases were verified and approved by a proctologist. There was no mention whether he was blind or not, and of course none of the culprits were ever charged.

And just when it looked like there may have been a glimmer of hope for reform, when authorities capped the age limit to 18 of unmarried daughters of deceased public service workers receiving pensions of 13,750 Euros per year, Greece's Court of Audit is now considering whether sons should be entitled to retroactively claim this bounty because they had been victims of sexual discrimination.

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Re: Greece

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schmuck wrote:You still with us Wallace?
Yup

Deja-vu all over again as Tsipras does a "Bob Rae" and chokes on all his principles. After organising a referendum and getting the result he lobbied for (a "no" vote) he now signs a "yes" agreement. Unbelievable. His countrymen are calling it a "coup".

The moneylenders have won and the politicians are running down the road with this unexploded bomb. When the big bang comes, the fallout will be much worse than it would be today.

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Re: Greece

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schmuck wrote: ...
BN-HD953_GKPENS_G_20150227120214.jpg
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Re: Greece

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That's not a fair comparison because the per capita is more important as well as the age of retirement.
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Re: Greece

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Not to mention the cost of living,medical costs,climate etc.
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Re: Greece

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Wallace
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Re: Greece

Post by Wallace »

Greece just isn't going to go away. Interesting article in Friday's G&M about the status of Germany and Europe's debt (-edit -) loans to Greece. Also some interesting comments about the tension between the European lenders and the IMF. Avner Mandleman compares the German situation to the dot-com bubble and America's sub-prime housing crisis and argues that a German/European collapse is all but inevitable.

What if European debt goes the way of the dot-com bubble?

My biggest exposure to Europe is a moderate position in EXCO, a car parts company producing moulds for cars and car seat covers. It's been a blockbuster for my TFSA but if Germany begins to look like another Ireland it'll have to go.

Any thoughts on how to plan for the European risk?
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Re: Greece

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Wallace wrote:Any thoughts on how to plan for the European risk?
Just like the often misquote "News of my death is greatly exaggerated", so too is my belief that Europe is 'doomed''. I have circa 10% of my portfolio directly committed to Europe via VGK and other equivalents and do not plan to reduce that exposure. I am almost certain to to increase it by moving some US gains over to Europe. If one looks at either the MSCI or FTSE European indices, I can't see anything to be worried about.
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Re: Greece

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Back in the news: Greek MPs approve toughest austerity measures yet amid rioting
Crucial meeting of euro zone finance ministers will be held on Monday amid backdrop of violence in Athens over cuts worth €5.4bn.
Greece’s leftist-led coalition will turn to the lightning rod issue of debt relief on Monday at a crucial meeting of euro zone finance ministers following the late-night approval in Athens of laws overhauling the country’s tax and pension system...
In an unprecedented step, lenders are expected to focus on the nation’s staggering debt load – at over 180% of GDP the largest in Europe with Athens keen to secure a pledge that a write-down is in the office...

http://www.theguardian.com/world/2016/m ... erity-vote
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Re: Greece

Post by Taggart »

So one thing led to another and found this performance chart kindly produced by MSCI showing the performance of the stock market in Greece from 2004 to October 2019.

https://www.msci.com/documents/10199/72 ... bddb18a4a6

$100 USD invested in 2004 would now be worth $7.86.
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Re: Greece

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A good reason why NOT to invest country specific, especially in countries that can't seem to help themselves. Clearly a lot of European countries are not of the same ineptness though.
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Re: Greece

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Taggart wrote: 04 Nov 2019 13:14 So one thing led to another and found this performance chart kindly produced by MSCI showing the performance of the stock market in Greece from 2004 to October 2019.

https://www.msci.com/documents/10199/72 ... bddb18a4a6

$100 USD invested in 2004 would now be worth $7.86.
Scary. You don't want to exclude the possibility of something like that happening here, but then when you look at the MSCI index composition for Greece: "With 8 constituents, the index covers approximately 85% of the Greece equity universe". It's a world apart from Canada.

It's 3 banks (42%), 1 telco (20%), 1 sport betting company (14%), 1 retailer (12%), 1 energy company (less than 9%) and 1 concrete company (less than 5%). 85% of that 85% would be 5 regulated monopolistic/oligopolistic companies, which exist only because of government protection.
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Re: Greece

Post by tedster »

We were in Greece in the first two weeks of September. We saw no homeless, although we did see some Indian/African people working in some of the restaurants. All the restaurants and bars were hopping and not just with tourists. IOW, the economy seemed to be booming.
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Re: Greece

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Greece GDP has turned around but it's been painful and is coming off a low bottom. Not the place to be a stockholder.
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