Bank-rupt-cy

Germany is the biggest economy and therefore the biggest spender for bankrupt EU member states. Just to get things clear:

1. Nations are for providing a framework for their people to live in free.
2. Therefore nations take money from their people to spend it for them.
3. Therefore countries can’t go bankrupt (AAA+) !

However, since #3 seams not to be right anymore we have to ask “why?”. The answer is simple: globalized economies. Even though, sceptics want to turn back time on this phenomena it exists as long as humans trade. All countries around the world trade with each other with their taxpayers money. If they are lucky there is a jackpot to be won. However, it is also the reason why letting down Greece, Spain, Italy, Iceland or any other isn’t such a good idea.

Remember what happened after Lehman went down? It could get far worse if any of the western countries should fail. So what should be done instead? We should re-evaluate the list from above in reversed order:

1. Pay your debts!
   • If necessary lend yourself money, to pay the debts by other debts, but keep an eye upon the interests
   • You’ll need all support you can get!
2. If you can’t, try to lower your debts:
   • If banks can’t spare some percentages, they’ll lose it all
3. If it doesn’t work, you’ll still have to ensure the framework doesn’t collapse:
   • Ensure jobs
   • Provide at least basic services
   • Keep social security running
   • Make your people confident in the future!
4. If you fail the above civil war wont be stoppable!

Now talking about Greece, we’re already up to number 2. The EU has lend money and gives out guarantees. However, the new CCC-rated nations of the western world are so deeply indebted that giving money can’t fix the situation anymore. Therefore it could be argued it’ll be wise to make banks waive some of their claims. However, that would be a sign of weakness and things could turn out more messy then they already are – say the rating agencies and stock market analysts.

I was pleasantly surprised when I heard German job agencies where advertising in nations with too many skilled personal in the sectors of German employment gaps, to help each other economies. Even though this is just dislocating the problems instead of solving them, it buys valuable time if done properly. More important then throwing tax payers’ money out the window and lowering the debts is keeping Greece together. The demonstrations have already turned violent. What would happen if Greece would get bankrupt? There would be a civil war caused by a spreading disease in the middle of Europe!